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American Dream Poll: Fewer Americans Think It’s Achievable

Isaac Nuriani    |
Dec 1, 2023
  • Minority of citizens say American dream “still holds true.”
  • Half of Americans earn less than $3,400 per month.
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Something I’ve discussed frequently of late has been the steady decline in consumer sentiment among Americans. 

As inflation soared in 2022 and the Federal Reserve set about the task of reining price pressures in with a singular, surgical focus on raising interest rates, sentiment among consumers struggled in the face of those headwinds. 

Finally, a light at the end of the tunnel appeared to come into view around mid-summer of 2023 as it appeared the worst of inflation was behind us. In July, The Conference Board’s Consumer Confidence Index reached 114 (downwardly revised from an initial reading of 117), the highest it had been since December 2021.[1]  

In the same month, the nation’s other widely followed sentiment gauge, the University of Michigan Consumer Sentiment Index, reached 71.5…it’s highest reading since October 2021.[2] 

But no sooner did the dust settle on those highest-in-a-while measures than sentiment – as measured by each of these comprehensive metrics – begin to struggle once again. 

The Consumer Confidence Index tumbled for three straight months, landing at 99.1 in October. Earlier this week, The Conference Board revealed that the index came in at 102 for November, and while that’s an improvement from the 99 reading from October, it’s still the lowest reading for the metric since last December (exclusive of last month).[3] 

As for the University of Michigan’s sentiment index, that fell in November for the fourth straight month and is now at its lowest level since May.[4] 

You get the picture: Over the last several months, consumers apparently have found it difficult to muster enthusiasm about either the economy, in general, or their personal financial circumstances, in particular. 

But is the gloomy outlook of Americans even more deeply rooted than what might be construed from a few months of falling consumer sentiment? One recent poll by the Wall Street Journal suggests the answer to that question is, “Yes.”  

Hold that thought for a moment. 

You may be aware that President Biden’s “selling” of so-called Bidenomics hasn’t been going particularly well. We know that, in part, from the falling consumer sentiment I just referenced. But we also know it from numerous polls on the subject, one of which recently revealed that just 14% of the country thinks it’s better off financially since Biden assumed the presidency.[5] 

Another potential problem with Bidenomics is that the president insists on using it as a synonym for the “American dream.” And here’s the problem with that 

According to the Wall Street Journal poll, just slightly more than one-third of voters think the American dream – defined as the capacity of any citizen to be successful regardless of where he or she started from – actually exists any longer. 

We’re going to discuss that poll in greater detail this week. I think the bottom-line result is fascinating…it possibly implies something of a sea change in how Americans view their circumstances and those of the country. Is it possible that a large number of Americans see personal economic hardship and uncertainty as standard features of life in the U.S. – and bona fide “opportunity” just a relic?  

We’re going to try to answer the question by not only looking closer at the poll results but at a couple of other collateral pieces of recently revealed economic information; information that may help clarify why Americans are so pessimistic about their prospects that so many have decided the American dream itself is now a thing of the past. 

Survey Respondent: American Dream “Is Past Tense” Thanks to Inflation 

If Bidenomics really is synonymous with the American dream, it makes total sense why citizens aren’t buying it. Because according to the poll of registered voters conducted jointly by the Wall Street Journal and the NORC (National Opinion Research Center), the American dream is, indeed, a dinosaur. 

The survey results revealed that just 36% of voters think the American “still holds true,” which is how the question was asked. Notably, the result is substantially less than the 53% who said so in 2012. And it’s half of the 68% who said last year in a different Wall Street Journal survey that they agreed Americans who work hard are likely to get ahead.[6] 

Another disquieting result from the recent Wall Street Journal survey: half of respondents said that “life in America is worse than it was 50 years ago,” while only 30% said that it had improved over that period.[7] 

“The survey offers the latest evidence that Americans across the political spectrum are feeling economically fragile and uncertain that the ladder to higher living standards remains sturdy,” the Journal wrote, “even amid many signs of economic and social progress.”[8] 

And make no mistake: disillusionment with the American dream crosses party lines. 

30-year-old Democrat Oakley Graham is one who believes that life is worse now than it was 50 years ago. And while he acknowledged to the Journal that some might look at his thriving family life in the suburbs and think he’s living the American dream, he doesn’t see it that way. 

“We have a nice house in the suburbs, and we have a two-car garage,” Graham said. “But I’d be lying if I didn’t say that money was tight.”[9] Graham assessed the financial reality being lived by his family and his neighbors this way: 

No matter how good it looks on the outside, I feel we are all a couple of paychecks away from being on the street.[10]  

On the other side of the political dividing line sits 78-year-old Republican and self-professed Donald Trump supporter John Lasher, who expressed to the Journal his feeling that the American dream “is past tense.”[11]  

Lasher puts responsibility for what he sees as the demise of the American dream squarely at the feet of persistent inflation. 

“With inflation, you’re working hard just to make ends meet,” Lasher told the Journal, “and then any extra work that you put in is just trying to get so you’re not in the hole.”[12] 

The Wall Street Journal poll comes on the heels of another recent voter survey that conveys similarly pessimistic feelings about America and her future.  

A national NBC News poll conducted in mid-November revealed that a mere 19% of voters say they’re confident that their children will have better lives than they do. Dating back to 1990, the percentage of voters who feel that way has never been lower.[13]  

So, what is it that sits at the core of this now-widespread belief that the American dream essentially no longer exists?  

The comments of both Graham and Lasher suggest it simply is the inability to reasonably afford it; the inability to get ahead on the basis of a focused effort at one’s labors. 

One obvious reason for that is inflation, which, as we’re about to see, is taking a much-bigger bite out of paychecks and household budgets than many people may realize. Another closely related reason is that while the nation may be at what is generally considered to be full unemployment, Americans just aren’t making enough money to live…let alone get ahead in any meaningful way.[14] 

Let’s talk about these issues next. 

Economist: Reality Is Setting in That “Prices Rarely Go Down” 

The idea that inflation in the U.S. can get so bad that it actually can alter citizens’ perceptions of whether the American dream itself remains intact – a notion clearly harbored by John Lasher, for example – speaks to just how devastating the impact of price pressures can be. 

Lately, we have been getting used to hearing about how benchmark inflation measures continue to decline from their highs of a year or so ago. Policymakers and many economists are quick to suggest that our long national inflation nightmare is behind us each time a new price metric comes in a little lower than it did the month before. 

But for consumers, the more recent signs of decelerating inflation can’t obscure the cumulative impact that ongoing price increases have had on households. And a new report from Bloomberg Economics illustrates in detail just how much more expensive that essential goods and services are now compared to just a few years ago. 

Let’s start with groceries. Bloomberg determined the price of fresh fruits and vegetables are 14% higher than they were in 2020. Coffee is 23% higher. And the price of a pound of ground beef has risen nearly 35% over the past three years.[15]   

Bloomberg discussed two surveys – one from 2020, another from 2023 – that illustrate in no uncertain terms just burdensome food inflation is currently on U.S. households. The 2020 survey determined a family of four spent an average of $238.32 per week on groceries, while the recent survey revealed the figure now is $315.22. Based on that particular set of data, it now costs a four-person household about 32% more to buy the groceries they were purchasing just three years ago.[16]  

The list of “staple” goods and services that cost significantly more than they did in 2020 seems endless. Rent is 20% higher. Electricity bills are 25% higher. Natural gas is nearly 30% more expensive. Automobile insurance is up 33%. And the reason you need that insurance in the first place? Used-car prices are up 35% over the past three years.[17]  

The chronic nature of long-term price increases can be such that things simply don’t ever return to the way they used to be. And that possibility now is being sounded out by Bloomberg and others. 

“A sense of reprieve for consumers is likely not imminent,” Bloomberg assessed at one point in its report.[18] It is a sentiment echoed by some economists, as well, including Sarah House, senior economist at Wells Fargo & Co. 

“The reality is setting in for consumers that prices rarely go down, especially not in the aggregate,” House said. “And so really the best they can hope for is prices leveling off and — at the very least — growing at a slower rate.”[19] 

As if this all isn’t enough to convince many that the American dream may be on life support, there’s yet another set of new numbers that likely further reduce the hopefulness of those already fighting to keep up with higher prices. 

The Social Security Administration (SSA) just released national wage statistics for 2022, and the data serves as a depressing “Part B” of information that makes Americans’ waning financial optimism even more understandable. 

Half the Country Now Earns Less Than $3,400 Per Month 

According to SSA, the median annual wage earned by Americans last year was $40,847.18 – before taxes.[20]  

That comes out to about $3,400 per month – again, pre-tax. But remember what “median” means; in this context, it means that about half of all American workers made less than $3,400 per month last year.  

Let’s add some additional perspective. According to Rent.com, the median rent Americans are paying right now is only slightly less than $2,000 per month.[21] The average car payment for used cars – I’ll just stick with used cars here – is $528 per month according to Experian.[22] 

That means if you earn the median salary – and, once again, half the country earns less than the median – you have about $900 left over to cover every other expense (including taxes) if you rent a place to live and make a car payment. 

You don’t have to spend much time thinking through both these income numbers and the inflation numbers discussed earlier to understand why barely one-third of voters told the Wall Street Journal they still believe the American dream is accessible. 

It’s bad enough that Americans are struggling right now in the current climate. But it seems that a sizable portion of them have decided things are so bad that the impact actually means the American dream is no more.  

It’s a particularly sober realization, even if you don’t happen to be one of those struggling as so many are. That’s because it suggests at least the possibility of a future deterioration of the overall U.S. economic order…a deterioration that potentially could exert a significant impact on the financial circumstances of all Americans, eventually.    

 

 

 

[1] Tirthankar Chakraborty, Yahoo Finance, “Dip in Consumer Confidence Sparks Recession Fears: 3 Gainers” (August 30, 2023, accessed 11/30/23). 
[2] Federal Reserve Bank of St. Louis, “University of Michigan: Consumer Sentiment” (accessed 11/30/23). 
[3] Investing.com, “U.S. CB Consumer Confidence” (accessed 11/30/23). 
[4] University of Michigan Surveys of Consumers, “Final Results for November 2023” (accessed 11/30/23); Federal Reserve Bank of St. Louis, “University of Michigan: Consumer Sentiment.” 
[5] Lauren Fedor, Eva Xiao and Oliver Roeder, Financial Times, “Only 14% of US voters say Joe Biden has made them better off” (November 13, 2023, accessed 11/30/23). 
[6] Aaron Zitner, Wall Street Journal, “Voters See American Dream Slipping Out of Reach, WSJ/NORC Poll Shows” (November 24, 2023, accessed 11/30/23). 
[7] Ibid. 
[8] Ibid. 
[9] Ibid. 
[10] Ibid. 
[11] Ibid. 
[12] Ibid. 
[13] Bridget Bowman, NBC News, “‘Mourning in America’: Poll finds pessimistic voters” (November 21, 2023, accessed 11/30/23). 
[14] Bureau of Labor Statistics, “The Employment Situation – October 2023” (November 3, 2023, accessed 11/30/23); Tim Smart, U.S. News & World Report, “2022 Sees a Labor Market Reaching Full Employment” (January 10, 2022, accessed 11/30/23). 
[15] Reade Pickert and Jennah Haque, Bloomberg.com, “Just How Bad Is the US Cost-of-Living Squeeze? We Did the Math” (November 27, 2023, accessed 11/30/23). 
[16] Ibid. 
[17] Ibid. 
[18] Ibid. 
[19] Ibid. 
[20] SSA.gov, “Measures Of Central Tendency For Wage Data” (accessed 11/30/23). 
[21] Rent.com, “The Rent Report – November 2023” (November 20, 2023, accessed 11/30/23).  
[22] Experian, “Captives Recapture Total Vehicle Financing Market Share in the U.S.” (August 31, 2023, accessed 11/30/23). 

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