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Salvaging the American Dream

Tuesday, June 14, 2011

Here at the end of a major phase in American history, our nation’s aim must now be to reinvigorate our suburban communities in both the social and economic sense.

In a provocative and sobering series of online articles, the historian Walter Russell Mead has been exploring what he calls the “Death of the American Dream” and what it means for our society and the country’s future. The lifetime goal of owning one’s house has crumbled with property prices, Mead believes, and the whole postwar American social compact is unraveling. While Mead may be right that our appetite for quick financial gain outstripped economic reality, American society has made an irrevocable move to the suburbs. Our nation now must strive to discover how to reinvigorate our suburban communities in both the social and economic sense.

Mead argues that “for eighty years we have defined the American Dream as an owner occupied family home, preferably with a nice swathe of crabgrass-free lawn around it.” Today’s collapse of housing prices, the tidal wave of foreclosures, and the economic restructuring of the mortgage market as the cornerstone of the American financial system, therefore all signal the end of one of the major phases in American history. According to Mead, “American housing policy has reached a dead end” and with it has died a broadly shared consensus on American lifestyles and the shape of our society.

For all the abuse that it has taken, the suburban single-family household may be the best solution society can come up with.

The first American Dream was the small family farm and homestead, which he argues shaped American society from colonial times to the early 20th century. Mead traces the demise of the traditional family farm, a moderate-income producing socioeconomic model, and its substitution by the lifetime debt of home ownership, particularly in post-World War II suburbia. He calls this a fateful transition, but rightly notes that it has only been in the past decade or so that the idea of the home as a goose laying the golden egg of retirement savings threw the system out of whack. Speculation, unsustainable price increases, and massive risk taking all accompanied the past decade of what I would call home investment (something different from home ownership).

Mead’s broader point, that post-war U.S. economic growth ultimately was based on massive and self-reproducing debt held by individual citizens and their local and federal governments, is clear and damning. We have, as he puts it, maxed out our credit cards, and now need to start living not only within our means, but with a reduced expectation for economic gain from housing, which never should have been seen as an investment in the first place.

As usual, Mead is right on target in identifying a sweeping issue at the heart of American society. Yet I would suggest three areas that supplement his reflections or question his prescriptions.

The very trends Mead hopes for are already in evidence and are growing stronger.

The first is the absence of the city in his analysis. Mead jumps directly from the family farm to what he calls “Dream 2.0: home ownership in the suburbs accompanied by a consumer lifestyle based on credit card debt and the installment plan.” Yet for millions of Americans, from the late 1800s through the mid-1900s, the Dream was to move out of small town America to the big city. Similarly, for tens of millions of immigrants, the goal was simply moving to America period, and most of those immigrants wound up in urban centers, both large and small.

The city was the focal point of American life from the early 20th century onward, and was reflected as such in literature and later the film industry. Pastoral treatments of America, like The Adventures of Huckleberry Finn, gave way to the stories of F. Scott Fitzgerald and Sinclair Lewis or the urban dystopic films of Charlie Chaplin. Mead correctly points out the idea of home ownership caught on from the 1920s onward, especially once national merchants like Sears Roebuck offered prefab homes for easy construction, much of which took place in urban centers small and large.

Millions, however, continued to live in crowded apartment blocks, townhouses, or row houses, and the vitality of cities like New York and Chicago remained a pull for those from the farm who weren’t looking for a quarter acre in Westchester, but rather a one-room in Greenwich Village.

As for those who moved off the farm but not to the big cities or suburbs, they congregated in smaller towns and villages, neither urban nor rural, just like Huck Finn, whom Mead refers to in the second installment of his post.

The magnetic attraction of the city, due to its diversions and for its educational and work opportunities, occupied an increasingly large space in the American psyche and popular culture in the early 20th century, long before the idea of Levittown came to define the 1950s.

No one who has paid attention to the past few years will quibble with his assertion that we will have to start living within our means, tempering our expectations, and refocusing on things of value in our lives.

Mead also explores the concept of the holistic rural family in which parents worked together and children received an education based on the lifecycle of the farm and family. Mead appears to see the 19th-century family farm as the pinnacle of social organization, much as Lewis Mumford saw the organic medieval city as a mix of balance and vibrancy. Mead decries the move from the farm to the “box in the burbs” and “big box” public schools, which do a much worse job, if they even try, of training American youth in concepts of citizenship, self-reliance, and traditional morals.

Yet the millions of erstwhile farmers and immigrant families that sent their children to P.S. 10 or Walt Whitman Elementary School never partook of this kind of holistic education that Mead talks about. For better or worse, the public school system educated the vast majority of American children, not just immigrants—including Tom Sawyer, Huck Finn’s rambunctious, small town friend. Those lucky enough to get the type of education Mead lauds were probably in a minority.

As for today, Mead argues that the suburban blue social model (semi-permanent Democratic local government along with social democratic and welfare state policies) which succeeded the family farm is hollowing out with the current crisis, thereby leading to an uncertain future in which old concepts of neighborhood, work, and even family are now to be renegotiated. The upshot is to further remove American youth from institutions that can transmit communal knowledge, traditions, and mores.

Mead’s broader point, that post-war U.S. economic growth ultimately was based on massive and self-reproducing debt held by individual citizens and their local and federal governments, is clear and damning.

But rising divorce rates and the increase in single-parent households over the past 40 years have already deeply undermined the Levittown ideal, let alone the old rural model. Whether such social trends were due to the move into cities and then suburbs by rural and immigrant Americans alike cannot be known, but Mead does not discuss the experiences or stability of those American families that never lived on farms. If the suburban model was inferior to the farm, it nonetheless may only have lasted for a decade or so after World War II, and what succeeded it was one in which parents were even less involved in the lives of their children, as Mead indicates.

Today, however, there are a non-trivial number of American families that are attempting to recreate the more traditional upbringing that Mead lauds. They cannot of course replicate the exact conditions of the holistic family farm, but religious families, in particular, are forgoing double incomes in order to have one parent at home to raise children. Many, as well, are choosing to homeschool their children, not trusting in the public school system; estimates are often incomplete, but generally somewhere between 1 and 2 million U.S. school-age children (out of roughly 53 million) are taught by parents or in collectives. These families are also the most demographically active in U.S. society, and their relative percentage of overall U.S. population will only increase in coming decades. Thus, we may expect more children to be homeschooled or to grow up in stable two-parent families where one parent stays at home.

Whereas Mead looks forward to a new era in which greater public participation in educating children grows out of dissatisfaction with the current blue social model, the very trends he hopes for are already in evidence and are growing stronger. Where Mead is absolutely right, of course, is that the health of American society and democracy rests in no small part on how we bring up our children and how we organize our family and social life.

Mead rightly notes that it has only been in the past decade or so that the idea of the home as a goose laying the golden egg of retirement savings threw the system out of whack.

This leads one, then, to question some of the prescriptions Mead offers to get us out of the fix we find ourselves in. No one who has paid attention to the past few years will quibble with his assertion that we will have to start living within our means, tempering our expectations, and refocusing on things of value (even virtue) in our lives. It will certainly be hard to change the consumerist mindset of two or more generations of Americans, but a re-engagement with family and the values of hard work and lifetime (not immediate) gratification is of utmost importance to the health of American society.

However, with respect to the way we physically organize our communities, it would seem there is no place to turn to but the suburbs. There obviously won’t be a return to the family farm model. And as Mead indicates, the blue social model based on urban centers is even more broken than the suburbs. The majority of Americans will continue to live in suburban and exurban areas, which means that the majority will continue to live in single-family houses. Now, if home ownership is to change, leading to fewer families owning their homes, but instead renting single-family dwellings, then the very traits of self-reliance and responsibility that Mead identifies as crucial to socioeconomic health will further wither.

On the other hand, if the majority of Americans continue to own their homes, then it will be hard to argue that the American Dream is dead. Home ownership will remain an organizing social ideal, even if the economics and legal mechanisms surrounding it (i.e., cheap and easy debt) will perforce have to change to make the system sustainable.

Mead decries the move from the farm to the ‘box in the burbs’ and ‘big box’ public schools.

Further, Mead predicts that this general reorientation will lead to more Americans working from home and more multigenerational homes, as we had in the past. I’m less sanguine than Mead that these changes will occur (though much evidence exists that children are living longer at home, into the 20s and later), especially the number of working-at-home parents. Only a small subset of workers in the intellectual trades or the service sector will be able to do this. Thus, the family will still be subjected to the stresses of commuting wage earners, which is one area that Mead identifies as corrosive of family life. Where I would supplement Mead’s argument, though, is in predicting that the priorities of those workers may well change due to the upheavals of recent years, leading to a greater focus on family and community. In short, there’s nowhere else to go for America’s families, and so the American Dream 2.0 may evolve, but won’t be supplanted.

On the whole, that’s a good thing. As Mead notes, the prevalence of suburban home ownership transmitted concepts of responsibility from the farm to modern times, through the legal compact of the mortgage. But the much more personal environment of the suburbs in comparison with the city likely meant a greater level of participation in civic associations, Parent Teacher Associations, church and synagogue groups, and the like. These are the trends that should be encouraged, along with a responsible approach to consumerism (which, after all, drives the U.S. economy).

As Mead points out, the real American Dream is to live a prosperous and independent life, and Americans can choose where to do that, from farm to downtown. For all the abuse that it has taken, the suburban single-family household may be the best solution society can come up with, a golden mean between the intimate, perhaps parochial, family farm, and the vibrant, if atomizing and impersonal, urban center.

Where Mead can be faulted, perhaps, is in being too generous in his analysis of the current state of affairs. I’ve just spent a month traveling in India and Indonesia. Coming face to face with the horrible poverty of those countries, the lack of infrastructure and public hygiene, the realization that life will always be a race to simply stay afloat for so many, made me come back more grateful than ever before for the riches of our country. It also made me more outraged over the crippling waste of our patrimony that we’ve suffered over the past several years and more willing to point fingers. I wish Mead were as angry as he is eloquent. Sometimes, righteous anger is necessary, the only way to shock the body politic out of its stupor and push us back on the right path. Walter Russell Mead has done another public service by talking about the Death of the American Dream. It’s now time to figure out how to salvage it.

Michael Auslin is a resident scholar in Foreign and Defense Policy Studies at the American Enterprise Institute.

FURTHER READING: Auslin also wrote “Is Japan a Failed State? Does It Matter?,” “The Partnership of the Future,” “India's Southern Promises,” and “Fearing the Chávez Model.” He has published several books, most recently Pacific Cosmopolitans.

Image by Rob Green/Bergman Group.

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