Posted by: Dan Beucke on January 5, 2012 at 3:00 PM
A front-page article in today’s New York Times examines the long odds of rising from the lowest rungs of American society. It’s a more complex issue, of more consequence, than the much-debated question of whether the rich are paying their fair share of taxes. And if packaged effectively, it could be a far more potent issue in the presidential campaign.
I say “complex” because, trust me, you can get tied up in knots trying to sift the economic research on mobility. How easy is it to move from one income group to another? It all depends on whether you’re measuring one person’s movement over time, or movement of a family over generations; how much income you need to lose or gain to cross segments; whether you have more income than your parents did, even if your relative position remains stagnant; and so on. The important thing to know is that many economists agree that if you’re in the lowest fifth of household incomes (up to about $20,000 as of 2009), the chances that your children will climb to the top are much less than they are for better-off Americans.
One of the best articles on the topic was written in the National Review last November by Scott Winship of the Brookings Institution. Winship cut through the statistical fog over the relative state of U.S. mobility with this exercise:
If you’re reading this essay, chances are pretty good that your household income puts you in one of the top two fifths, or that you can expect to be there at age 40. (We’re talking about roughly $90,000 for an entire household.) How would you feel about your child’s having only a 17 percent chance of achieving the equivalent status as an adult? That’s how many kids with parents in the bottom fifth around 1970 made it to the top two-fifths by the early 2000s. In fact, if the last generation is any guide, your child growing up in the top two-fifths today will have a 60 percent chance of being in the top two fifths as an adult. That’s the impact of picking the right parents — increasing the chances of ending up middle- to upper-middle class by a factor of three or four.
What to do about it? Here’s where a bold candidate could tap into a time-tested, emotional issue — opportunity in America — with policies that might appeal to both sides of the aisle. Winship identifies two possible remedies:
Boost education. Winship points out that “16 percent of those who start at the bottom but graduate from college remain stuck at the bottom, compared with 45 percent of those who fail to get a college degree.” Why are states chopping K-12 teachers and hiking college tuition, from California to Texas to New York? Sure, budgets are tight and it’s not clear what education model works best. But these wholesale cuts smack of the same penny-wise-pound-foolish logic as saving money by letting roads fall apart.
Reduce one-parent families. Children with divorced parents have a tougher time moving up, and unplanned pregnancies are higher among those with low incomes. Programs that promote intact families, and birth control, might help.
The challenges of economic mobility have been acknowledged by such leading Republicans as Rick Santorum and Mitch Daniels, and they were laced throughout President Obama’s populist speech in Osawatomie, Kansas, last month. As the heat turns up on the 2012 race, let’s hope economic mobility gets moved to the front burner.
Photographer: Daniel Acker/Bloomberg