Is the American Dream More Dead Than Alive?

OURS WAS THE SHINING FUTURE: The Story of the American Dream, by David Leonhardt

David Leonhardt, a senior writer for The New York Times, has written a “biography” of the American dream, specifically — as his title, “Ours Was the Shining Future,” suggests — an account of how the dream has withered and all but died.

His striking contention, based on a study of census and income tax data by the Harvard economist Raj Chetty, is that where once the great majority of Americans could hope to earn more than their parents, now only half are likely to. Although the precise ratio depends on assumptions about inflation, and is less striking, as Chetty notes, when one takes into account shrinking household size, the general point is unquestionable. Economic progress used to define America. Now, Leonhardt finds “stagnation in nearly every reliable measure of well-being.” He arguably overstates the case — for instance, median household income has generally continued to rise — but the malady he identifies is real.

Leonhardt maintains that over the past 50 years the United States has gone off the rails by moving from a more regulated capitalism to a rough-and-tumble version that is more individualistic and market-centered. This shift, he asserts, has led to greater inequality and — a causal logic that is harder to prove — slower growth.

Leonhardt’s chief culprit is the political system: in a phrase, too many Republicans, and the wrong kind of Republicans. In the 1950s, we had Dwight D. Eisenhower, a nonideological retired general who extended New Deal-era reforms and invested in one of the great infrastructure projects of the century, the national highway system. Business executives of Eisenhower’s era were similarly socially minded. Nurtured by the twin crises of the Depression and World War II, they felt a common purpose with workers, tolerated unions and abided relatively modest executive pay.

Goodbye to all that. Come Ronald Reagan, Republicans traded the country club for the think tank. Conservative intellectuals and judges like Robert Bork (who was both) helped to change the culture and ultimately weakened both federal regulation and federal purpose.

The United States once had the world’s most educated population and an impressive transportation system. Now, we don’t. We also rank near the bottom among developed nations in providing pre-K classes. “We have drifted from our ideals” of “equality, liberty, opportunity and democracy,” Leonhardt writes, and, beginning in the mid-1970s, “entered a dark new economic era.”

While Leonhardt is a man of progressive sympathies — perhaps because of those sympathies — he devotes plenty of ink to castigating Democrats. He charges them with abandoning bread-and-butter issues like labor unions and the minimum wage for neoliberal causes, such as free trade and unreserved support for immigration. He also laments the party’s deep dive into identity politics, which has alienated working-class whites. The Democrats have become a party for college people.

Although this argument is familiar, “Ours Was the Shining Future” is not a familiar-feeling book. Leonhardt introduces every section with a historical vignette: A. Philip Randolph organizing train porters and winning raises of up to 30 percent for his union; Secretary of Labor Frances Perkins, the first woman to serve in a presidential cabinet, demanding that Franklin D. Roosevelt fight for unemployment insurance, disability and an eight-hour workday.

Leonhardt has clearly cherry-picked his anecdotes to make his case, but the stories enliven what could have been a dry or data-heavy polemic. They also advance his worldview: Policies and personalities have a great effect on economic progress.

If you think of the economy as something like an ecosystem, in which millions of self-interested agents interact through the medium of price, this is not the book for you. “Ours Was the Shining Future” offers a top-down view of economics. It’s a book about capitalism in which the heavy lifting is done by presidents, progressives and union bosses — not capitalists. In a sort of blue version of MAGA, Leonhardt is nostalgic for the era when C.E.O.s, unions and government officials ran the show. He has kind words not only for Roosevelt’s necessary job and entitlement programs, but also for the New Deal’s National Industrial Recovery Act, which mandated industry codes for fixing prices, wages and production quotas — a vast experiment in planning that the Supreme Court mercifully scrapped.

It occurs to Leonhardt only in passing that investors, business people, journalists, retail clerks, stockbrokers and others among the 85 percent of workers in the country’s private sector might contribute to its prosperity, thus this remarkably modest concession: “A progressive agenda, from the political left, is not the only plausible way to lift the living standards of most members of a society.” Well, thanks for that.

Leonhardt is fashionably focused on inequality to the almost total neglect of growth rates (where America generally ranks high). “Living standards here,” he notes, “are vastly higher than in much of the world.” That should count for something, but he repeatedly rates presidents, or their eras, by the yardstick of economic inequality.

What’s missing is a sense that policies to equalize, such as trade barriers, often involve a trade-off — benefits but also costs in the form of lost efficiency. He castigates President Clinton for being a Democratic version of Reagan, in particular for signing a free trade deal. He notes that upper-tier incomes grew more quickly under Clinton than wages at the bottom. Yet blue-collar wages notably revived, jobs boomed and the country flourished. Would blue-collar workers have given up prosperity in order to see investors suffer?

Clinton’s other sin, according to Leonhardt, is that “he did little to strengthen labor unions.” Leonhardt posits unions as an unqualified blessing, dismissing out of hand, or merely paying lip service to, the possibility that unions might have pushed up wages and benefits — in the automobile industry, say — to the point where their sectors became uncompetitive. And he asserts as received truth that the decline of unions held down wages. It’s also possible (something Leonhardt acknowledges) that as other nations rebuilt, or emerged, after World War II, America’s competitive position naturally diminished. Thus declining union membership may have been more effect than cause.

Leonhardt knows that Americans have “mixed feelings” about labor unions; he had mixed feelings as a member of a union at The Times. His union reps “seemed more interested in getting their own paychecks and reaching retirement than helping their members,” he writes. When he left the union to enter the ranks of management, he felt frustrated by the union’s “resistance to change” at a company “that needed to evolve.” Perhaps it has occurred to him that other companies also need to evolve.

Despite the implication of Leonhardt’s stylized narrative, economic trends such as wages do not always line up neatly with political eras. Real wages, along with union membership, had begun to decline by the early 1970s — well before the cultural triumph of the right in the Reagan years. The economic rebound under Reagan is inconvenient for Leonhardt, who maintains that conservative policies augur ill for growth. He marks down Reagan’s economic performance as less spectacular than that of Roosevelt, John F. Kennedy or Lyndon B. Johnson. Maybe a more apt, and fairer, comparison would have been to Reagan’s immediate (and weaker) predecessors: Nixon, Ford and Carter.

“Ours Was the Shining Future” is an interesting book, with many provocative points, but I found it too tendentious to be the last word on the fate of the American dream. Leonhardt tells us that his book is “for anybody trying to understand how our economy — and, with it, our society — has been hobbled.” He concludes with a discussion of how progressives might win elections in the future. His partisan pitch may put off some of the anybodies he aims to reach.

Roger Lowenstein is the author of “Ways and Means: Lincoln and His Cabinet and the Financing of the Civil War.”

OURS WAS THE SHINING FUTURE: The Story of the American Dream | By David Leonhardt | Random House | 492 pp. | $32