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The American Dream Is Not Dead: (But Populism Could Kill It)
Populists on both sides of the political aisle routinely announce that the American Dream is dead. According to them, the game has been rigged by elites, workers can’t get ahead, wages have been stagnant for decades, and the middle class is dying.
Michael R. Strain, director of economic policy studies at the American Enterprise Institute, disputes this rhetoric as both wrong and dangerous. In this succinctly argued volume, he shows that, on measures of economic opportunity and quality of life, there has never been a better time to be alive in America. He backs his argument with overwhelming—and underreported—data to show how the facts favor realistic optimism.
He warns, however, that the false prophets of populism pose a serious danger to our current and future prosperity. Their policies would leave workers worse off. And their erroneous claim that the American Dream is dead could discourage people from taking advantage of real opportunities to better their lives. If enough people start to believe the Dream is dead, they could, in effect, kill it. To prevent this self-fulfilling prophecy, Strain’s book is urgent reading for anyone feeling the pull of the populists.
E. J. Dionne and Henry Olsen provide spirited responses to Strain’s argument.
Michael R. Strain, director of economic policy studies at the American Enterprise Institute, disputes this rhetoric as both wrong and dangerous. In this succinctly argued volume, he shows that, on measures of economic opportunity and quality of life, there has never been a better time to be alive in America. He backs his argument with overwhelming—and underreported—data to show how the facts favor realistic optimism.
He warns, however, that the false prophets of populism pose a serious danger to our current and future prosperity. Their policies would leave workers worse off. And their erroneous claim that the American Dream is dead could discourage people from taking advantage of real opportunities to better their lives. If enough people start to believe the Dream is dead, they could, in effect, kill it. To prevent this self-fulfilling prophecy, Strain’s book is urgent reading for anyone feeling the pull of the populists.
E. J. Dionne and Henry Olsen provide spirited responses to Strain’s argument.
168 pages, Paperback
Published February 25, 2020
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311 people want to read
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Displaying 1 - 19 of 19 reviews
September 2, 2020
In his book, Michael Strain attempts to disprove the conventional rhetoric on both sides of the isle in which many claim that the American Dream is dying. The book is a quick read and the author does a good job of making the economic arguments digestible for a wide audience. With regard to the substance of the text, Strain makes a compelling case that typical living standards have significantly improved over the past few decades.
I believe Americans are more susceptible to the hedonic treadmill than other countries around the world which is a big reason why U.S. politicians espouse such a pessimistic narrative about progress. They know pessimism and not optimism is what drives clicks, views, and retweets. However, Strain rightly explains that messages matter. If people think the system is rigged, they will aspire to less, put in less effort, and experience declining economic outcomes, creating a self-fulling prophecy. In my view the greatest threat to the American Dream is not Populism or Socialism,but pessimism. If people are not hopeful for the future, they will be willing to take less risk, reducing innovation and dynamism.
With that said, I think Strain, does a poor job of not focusing on the lived experience of most Americans. For instance, he devotes only a couple sentences to addressing the lack of mobility for African Americans and quickly glosses over wealth inequality because he claims it is difficult to measure. These are massive deficiencies in the U.S. and we are seeing the repercussions play out during the pandemic. The wealthy have more savings to help them weather the recession and are more likely to possess a career that allows them to work safely from home. Meanwhile, minorities are being laid off by the millions as they make up the majority of low paying services sector jobs.
Strain's policy prescriptions leave much to be desired. He says, "To keep the economy growing, policymakers should pursue a light regulatory regime and low tax rates". As we have seen over the past few decades, this policy prescription leads to more, not less inequality (Perhaps this is why so little of the book addresses the issue of inequality). To the contrary, the Gini coefficient shows when you take into account after tax income and transfers, inequality decreases by about 30%. This shows the U.S tax and transfer system does in fact work and we can use it to uplift more people into achieving the American Dream.
I believe Americans are more susceptible to the hedonic treadmill than other countries around the world which is a big reason why U.S. politicians espouse such a pessimistic narrative about progress. They know pessimism and not optimism is what drives clicks, views, and retweets. However, Strain rightly explains that messages matter. If people think the system is rigged, they will aspire to less, put in less effort, and experience declining economic outcomes, creating a self-fulling prophecy. In my view the greatest threat to the American Dream is not Populism or Socialism,but pessimism. If people are not hopeful for the future, they will be willing to take less risk, reducing innovation and dynamism.
With that said, I think Strain, does a poor job of not focusing on the lived experience of most Americans. For instance, he devotes only a couple sentences to addressing the lack of mobility for African Americans and quickly glosses over wealth inequality because he claims it is difficult to measure. These are massive deficiencies in the U.S. and we are seeing the repercussions play out during the pandemic. The wealthy have more savings to help them weather the recession and are more likely to possess a career that allows them to work safely from home. Meanwhile, minorities are being laid off by the millions as they make up the majority of low paying services sector jobs.
Strain's policy prescriptions leave much to be desired. He says, "To keep the economy growing, policymakers should pursue a light regulatory regime and low tax rates". As we have seen over the past few decades, this policy prescription leads to more, not less inequality (Perhaps this is why so little of the book addresses the issue of inequality). To the contrary, the Gini coefficient shows when you take into account after tax income and transfers, inequality decreases by about 30%. This shows the U.S tax and transfer system does in fact work and we can use it to uplift more people into achieving the American Dream.
March 31, 2025
Figures lie and liars figure. That’s the old saw. And it will be on the lips to any readers of this book who are governed by preconceived notions of the state of the American economy and how it affects those at all income strata.
But the evidence is clear, as economist Michael Strain asserts in this marvelous little book. Incomes after inflation have been on the rise for all quintiles of the income scale since the early 1990s. Further, there is remarkable mobility between those quintiles. Strain presents data showing that 64% of those who grow up in the bottom quintile move up, and 61% of those who grow up in the top quintile move down. This book is full of data documenting his thesis.
This should be obvious to most of us. We have the privilege of living in the most prosperous society in the history of the world, despite what the media and populist politicians would have us believe. Indeed, Strain closes the book with refutation from both the progressive left and the MAGA right. Each have their own theses and justifications for an alternative view. But the evidence is clear. Things are pretty good in the USA, and the American Dream is alive and well.
But the evidence is clear, as economist Michael Strain asserts in this marvelous little book. Incomes after inflation have been on the rise for all quintiles of the income scale since the early 1990s. Further, there is remarkable mobility between those quintiles. Strain presents data showing that 64% of those who grow up in the bottom quintile move up, and 61% of those who grow up in the top quintile move down. This book is full of data documenting his thesis.
This should be obvious to most of us. We have the privilege of living in the most prosperous society in the history of the world, despite what the media and populist politicians would have us believe. Indeed, Strain closes the book with refutation from both the progressive left and the MAGA right. Each have their own theses and justifications for an alternative view. But the evidence is clear. Things are pretty good in the USA, and the American Dream is alive and well.
May 16, 2021
[Imported automatically from my blog. Some formatting there may not have translated here.]
This short book by (168 print pages, including end matter) was published in late February. It's by economist Michael R. Strain, who works for the American Enterprise Institute. I got the Kindle version for a mere $7.49, link at right. It's a quick read, very accessible.
Consumer note: some of the book's graphs rely on color. If your primary Kindle reading device is monochrome…
Strain's thesis is simple, set out right there in the title; he sets out to debunk the various doomsayers on left and right who claim that the American Dream is … well, if not dead, then seriously unwell. We're simply not doing that badly. Strain is no Pollyanna, setting out various challenges that the US is not meeting well. But he trots out some pretty convincing statistics showing that typical workers have been enjoying modest income gains over the past thirty years or so. He uses the "personal consumption expenditures" price index to account for inflation, as opposed to the more popular Consumer Price Index, arguably a more accurate choice.
Strain also looks at mobility, very relevant to the dream. He looks briefly at "relative" mobility—e.g., how likely is it that a kid growing up in a bottom-income-quintile family will move into a higher quintile? But he makes a good point about relative mobility as judged by income quintiles or some other N percent fraction of the income spectrum: when somebody moves up, someone else has to move down.
So he prefers absolute mobility, and the results are pretty cheery there. Most American men (about 59%) earn more than their fathers did at the same age. And about 80% of sons from the bottom 20% of income out-earn their fathers.
The numbers could be better. But we won't make them better (Strain goes on to argue) by various populist nostrums proposed by left and right: protectionism, industrial policy, punitive taxes on the successful.
Strain's book does something interesting by including rebuttals: one from the left (E. J. Dionne) and one from the right (Henry Olson). And then a final response to these critics—author's privilege—from Strain.
Even though it's a short book, I've left some stuff unmentioned here. It's very accessible and (to my mind) convincing.
April 25, 2021
Michael R. Strain makes a strong case that the American Dream of upward mobility is not dead. Packed with readable information as well as simple, clear graphs this book is a wealth of practical and understandable information. The best thing about it is that Strain invited two of his idealogical opponents to respond to and rebut his premise and his arguments. Both had good points that Strain responded to in a brief chapter at the very end; making his argument even stronger. All of it was done in a spirited yet respectful manner.
The only flaw in the book is that he did not spend enough time proving that Populism could really kill the American Dream (though I agree with him that it could). He needed more than just one brief section of a chapter to do that assertion justice.
If I could give this book 4.5 stars I would. Highly recommended.
The only flaw in the book is that he did not spend enough time proving that Populism could really kill the American Dream (though I agree with him that it could). He needed more than just one brief section of a chapter to do that assertion justice.
If I could give this book 4.5 stars I would. Highly recommended.
August 18, 2020
The book is a thorough look at income, wage, employment data. It was published just before the COVID-19 pandemic, so it lacks that but the analysis of the long run trends is very much still valid.
The results show the American Dream is alive and well for most of us. Wages are up, income is up, generational mobility is pretty good. Overall I buy his arguments and I think he makes a good case that we don't need massive overhaul of our economy or political system. Instead, we needed targeted and thorough relief for the pockets still struggling. He offers dozens of suggestions of what to do, they are all good.
Obviously with the pandemic the targeted relief will need to be broader but his case that generally our economy is good for the majority of us will still hold after the pandemic is brought under control.
I also really like that he included two dissenting essays in his book. That shows intellectual humility.
Some small critiques:
-Those pockets of struggling individuals are still pretty darn big, on the order of millions of people.
-He doesn't compare us internationally nearly enough. He shows positive trending charts but doesn't provide the context if that growth is better or worse than peers.
Overall a good contribution to the debate.
The results show the American Dream is alive and well for most of us. Wages are up, income is up, generational mobility is pretty good. Overall I buy his arguments and I think he makes a good case that we don't need massive overhaul of our economy or political system. Instead, we needed targeted and thorough relief for the pockets still struggling. He offers dozens of suggestions of what to do, they are all good.
Obviously with the pandemic the targeted relief will need to be broader but his case that generally our economy is good for the majority of us will still hold after the pandemic is brought under control.
I also really like that he included two dissenting essays in his book. That shows intellectual humility.
Some small critiques:
-Those pockets of struggling individuals are still pretty darn big, on the order of millions of people.
-He doesn't compare us internationally nearly enough. He shows positive trending charts but doesn't provide the context if that growth is better or worse than peers.
Overall a good contribution to the debate.
July 16, 2024
I spent a week with Dr. Strain at AEI where, among other readings, we read and discussed this. While certainly I have ideological differences with him and AEI, I will say that Dr. Strain's writing style is something every single economist and public intellectual can and should adopt. Straight to the point, chock-full of quantifiable and verifiable information, and clearly well-researched - something that I think many ideologically motivated economists lack, especially in the age of Trump.
In many ways, being an undergraduate student, this was an excellent rapid-fire analysis of the various issues that plague contemporary public discourse around the economy.
That being said, again I have ideological differences with Strain and might not agree with every single policy position or solution that he rather quickly proposes in this short read, but in terms of the diagnosis of the issues facing the economy and the counterpoints to the populist narrative, I think this is a sobering read for anyone (especially my wonderful progressive friends) who are in a manic episode thinking that the middle class and America is doomed.
In many ways, being an undergraduate student, this was an excellent rapid-fire analysis of the various issues that plague contemporary public discourse around the economy.
That being said, again I have ideological differences with Strain and might not agree with every single policy position or solution that he rather quickly proposes in this short read, but in terms of the diagnosis of the issues facing the economy and the counterpoints to the populist narrative, I think this is a sobering read for anyone (especially my wonderful progressive friends) who are in a manic episode thinking that the middle class and America is doomed.
December 23, 2020
This is a (short! yay!) argument about how the American Dream (largely cast in economic and income/wealth mobility ways) is not dead. Basically, while the middle class has been hollowing out, more people have been moving up than down, and people in the lower quartile of income do move up at rates substantially beyond randomness.
The author recognizes there are some substantial pockets which are having serious problems (rural areas with opioid epidemic, a subset of black people, etc), and that there is increasing male uneducated unemployment, but makes the case that these are exceptions and not the general rule.
He does a pretty good job of presenting good counter-arguments from others as well.
The author recognizes there are some substantial pockets which are having serious problems (rural areas with opioid epidemic, a subset of black people, etc), and that there is increasing male uneducated unemployment, but makes the case that these are exceptions and not the general rule.
He does a pretty good job of presenting good counter-arguments from others as well.
March 16, 2020
More an extended blog post (and responses) than a book, Strain struggles to support either theses in his book's title.
The first nine chapters present a generally convincing argument that globalization and economic realignment haven't left the middle class as hollowed out as so many politicians claim. Setting aside the charge of cherry-picking the time frame of data raised in the dissenting chapters, I wish Strain had done a better job of digging into how globalization and Great Recession transformed the middle class. He admits the economy isn't working for everyone. Outlining for whom it is and isn't working is a prerequisite to any discussion about policy changes.
The first nine chapters present a generally convincing argument that globalization and economic realignment haven't left the middle class as hollowed out as so many politicians claim. Setting aside the charge of cherry-picking the time frame of data raised in the dissenting chapters, I wish Strain had done a better job of digging into how globalization and Great Recession transformed the middle class. He admits the economy isn't working for everyone. Outlining for whom it is and isn't working is a prerequisite to any discussion about policy changes.
April 13, 2020
Thought provoking
Like many economics books, this one will challenge many people’s beliefs. I am one who believes that the American dream is definitely not dead, but nostalgia about middle class jobs that require little training and stay the same over a career is not productive. The future will require skill mobility, constant learning and the ability to adapt to change. That means we have to fix our educational systems (they are seriously outdated) and people need to increase productivity. So the dream is there, it’s terms are just different.
Like many economics books, this one will challenge many people’s beliefs. I am one who believes that the American dream is definitely not dead, but nostalgia about middle class jobs that require little training and stay the same over a career is not productive. The future will require skill mobility, constant learning and the ability to adapt to change. That means we have to fix our educational systems (they are seriously outdated) and people need to increase productivity. So the dream is there, it’s terms are just different.
September 4, 2023
While I enjoyed the main body of this work, I found his summary chapter a bit hasty and undeveloped. He claims that children should be in school 12 months a year instead of 9, without regard to the effectiveness of increased schooling or if school curriculum and time allocation reform would be more efficient and conducive for learning.
Several other sweeping policy recommendations that he didn’t take sufficient time to fully flesh out I took issue with, but the intention of this book important and the mood is bright.
Several other sweeping policy recommendations that he didn’t take sufficient time to fully flesh out I took issue with, but the intention of this book important and the mood is bright.
November 9, 2021
Decent book considering its length. Some parts could have used a little more meat to make it whole. It's fairly numbers and statistics oriented. What's telling is how our society's standard of living expectations have grown over the past few decades, and how that has shifted the meaning/significance of "the American dream". Strain's book here can help put things back in perspective.
September 30, 2020
Always interesting to get different opinions on the state of the country!
June 16, 2025
3.825/5
July 25, 2025
A very good look at American economic advancement since 1990.
August 5, 2025
A finely written summary that needs to be updated. Written before the pandemic and published in 2020, a refresh should be considered and expanded upon.
December 1, 2020
Thoroughly enjoyed the format of the book. The author attempts to make his case for why American Dream is not dead and allows critics to challenge his thesis in the same short book. I wish more books included dissenting views in the same book, especially policy centric books. I think Strain provides a succinct counter narrative to today's predominant views that should be taken seriously and incorporated when considering broad based policies versus targeted policies.
March 8, 2020
With statements like President Trump's "American carnage" and Senator Sanders's contention that the middle class hasn't had a raise in 30 years, populists on both the left and right maintain that American incomes are stagnant and quality of life is diminished. This book uses data to provide evidence that, for many, incomes are rising and quality of life may not be as bad as we imagine. The author wisely recognizes that problems persist, but suggests that it would be more effective to focus on real problem areas rather than generalize about stagnating wages.
July 16, 2024
Simple but convincing argument that the success of labor market has not stagnated in the last few decades. Strain adds two essays from dissenters at the end of the book, then refutes them; a nice and unique touch. Easy to read, sound economics
November 8, 2020
Strain provides a lot of good data points and overview on then prosperity gained over time. I tend to disagree with some of the policy implications that overlook the government failure rathe than saying we need more of it to solve some perceived market failures.
Ultimately, it’s a good book that you can learn about data and time series but lacks a good overview on the true problems we face and where to go next.
Ultimately, it’s a good book that you can learn about data and time series but lacks a good overview on the true problems we face and where to go next.
Displaying 1 - 19 of 19 reviews