U.S. Is 'Land Of Opportunity' No More?

Unemployment dropped in December 2011, but can Americans still count on moving up? Recent reports say America now lags behind Canada, Britain and some Western European nations in terms of economic mobility. Host Michel Martin talks with public policy analyst John Bridgeland and Brookings Institution economic expert Isabel Sawhill.

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MICHEL MARTIN, HOST:

I'm Michel Martin, and this is TELL ME MORE, from NPR News. Still to come we'd like to wish you Happy Three Kings Day. Believers celebrate this in commemoration of the day three wise men visited baby Jesus bearing gifts. We'll tell you how the holiday is celebrated in Latin America, the Caribbean, and in the U.S. One of the organizers of New York's big parade will tell us more about it in a few minutes.

But first, there was some good economic news today. The nation's unemployment rate fell in December to the lowest point it's been in three years. It now sits at 8.5 percent according to the Labor Department. So that's a good thing for today, especially for people getting opportunities to work now, but what about opportunity in the long term?

Of course, it's part of our national identity that the U.S. is the land of opportunity. A place one can rise by one's own efforts, where children are not limited by the circumstances of their birth or their parents' birth but there are disturbing reports suggesting that this is no longer the case in the U.S. and that the U.S. now lags behind its northern neighbor Canada and a number of developed Western European nations like Britain when it comes to economic mobility.

We wanted to talk more about this, so we've called upon Isabel Sawhill. She is a senior fellow in economic studies at the Brookings Institution. That's a venerable research and policy institute here in Washington, D.C. Also with us John Bridgeland who is president and CEO of a public policy firm called Civic Enterprises. He calls it an action tank. He's also a former special assistant to President George W. Bush. Thank you both so much for being here and happy New Year to you both.

JOHN BRIDGELAND: Thanks, Michel.

ISABEL SAWHILL: Thank you.

MARTIN: So, John Bridgeland, I'm going to start with you, because progressives have been talking about the issue of income inequality for quite some time and its related cousin, I would say, economic mobility for quite some time. For example, our other guest Bel Sawhill has been writing about this as part of a project at her institute for at least, what Bel, three, four years now?

SAWHILL: Oh, at least that. I actually wrote my first book on this topic ten years ago.

MARTIN: Exactly. So, John Bridgeland, I wanted to ask you, are conservatives now as concerned or at least some conservatives as concerned about economic mobility as progressives are?

BRIDGELAND: Yeah, I think conservatives recognize that anybody who works hard and plays by the rules ought to rise as far as their talents and skills will take them. But what is disturbing and I think will cause conservatives to really focus more attention on the economic mobility issue is that income equality without social mobility is completely unacceptable and completely un-American. We now know that if you're born in the bottom rungs of the economic ladder in the United States, only about six to eight percent of those young people will rise to the top.

Our counterparts in Europe that are viewed as class societies, and we're supposed to be a classless system, have more economic mobility in terms of rising from the bottom to the top. I think this is causing a number of candidates like Rick Santorum and others to take notice and to realize that a country that doesn't permit social mobility and has income inequality is almost like a class system.

MARTIN: Well, we know that President George W. Bush, with whom you worked, was very concerned about this as part of his concern about education and his No Child Left Behind initiative...

BRIDGELAND: Yes.

MARTIN: ...I know, as controversial as that was, the underlying question here was that no - literally no child should be hampered by, you know, a poor education. Isabel Sawhill, what is your assessment of why this is occurring? What's your analysis of why this is occurring?

SAWHILL: Well, these are trends that are long-term, because we're talking basically about intergenerational mobility and it's very difficult to say exactly what's driving it but I think education is really key. I'd also add that if the labor market isn't functioning very well, that is not going to help people to get ahead, even if they have a good education. And then finally, there's the whole issue of what's been happening to the family and the fact that too many children are being born to parents who really aren't ready to raise a child.

MARTIN: John Bridgeland, agree or disagree?

BRIDGELAND: You know, so, I'm going to quote Bel. I've been reading her books for more than a decade and she marshaled this powerful data, which was: only two percent of individuals who finish high school, work full-time, and have a stable family before having children end up in poverty. Those who do none of those things, more than 70 percent will end up in poverty. So, I agree with Bel that this education gap - we have a high school dropout epidemic; we have among the most - the highest college dropout rates in the world - has led to a skills gap, or what David Brooks has called a skills slowdown. Ninety-five million jobs in America for which we only have 45 million qualified workers, and in turn I think that creates an opportunity gap.

MARTIN: What is the disagreement, then, between the political left and the political right - and I'm obviously I'm using those terms for, you know, for ease of discussion. Is it, if people agree on the what, do they disagree on which factor is most important, John Bridgeland? What do they disagree about?

BRIDGELAND: Yeah, I think there's been a disagreement around this notion of the issue is income inequality, because if the issue is only income inequality, that leads to issues of redistributing wealth, which conservatives are strongly against. They worry about it impeding innovation, entrepreneurship, and inhibiting progress and growth. But as they've seen this issue of social mobility and the lack of our ability to educate the future workforce, the skills gap that we have, and the impact this is having not only on the economy but on the ability of every American who has a right to be educated and to grow and develop.

It's sounded an alarm and I think the solutions - stronger education, multiple pathways to work, not just a four-year degree for all but one year, two year, bring back vocational education to give multiple options to young people who may want to take different paths. And in a way that as Bel said, matches the labor market and the needs of the labor market.

MARTIN: We're talking about the mobility gap in the United States. We're talking about why it might be more difficult for those on the lower rung of the economic ladder to move upward. We're speaking with John Bridgeland of Civic Enterprises. That's a private public policy and development firm, and also Isabel Sawhill of the Brookings Institution. That's a research and public policy institute. We're talking about this, but Isabel Sawhill, what's your sense of what is the disagreement about why and then of course obviously we want to move into a discussion of what people think we should be doing about this.

SAWHILL: I think that some - there is some disagreement about what you called the relationship between inequality and mobility. You said they were cousins. I liked that way of thinking about it because my sense is that as the rungs of the ladder, the economic ladder, get further and further apart, it also becomes harder to climb the ladder. So, although I think opportunity and the notion of mobility is a distinctively American idea and one that we can all endorse and can have bipartisan support, I don't think we can just ignore the fact that inequality may be playing a role here.

So, that's one issue. A second issue, and we may get into this in a minute, is that if you want a much smaller government than we have now or are projected to have with the growth of entitlement programs for the elderly, then it's going to be hard to do what needs to be done and what some of these other advanced countries do in terms of financing people's education, making sure that kids have a good start in life, making sure that training and retraining programs are available for workers, that we have good infrastructure, all those kinds of things that probably only the public sector can do.

I don't want to suggest that there isn't a role for individuals. We need everyone to be striving to climb that ladder and taking personal responsibility in that process. But I think government also has to play a role.

MARTIN: John Bridgeland, what role do you think - or what should be done about this if that is, indeed, one of the points of disagreement?

BRIDGELAND: The good news is that this isn't just theory. Bel and I and a group of more than 200 organizations in the United States have joined together in an initiative called Opportunity Nation to bring left, right and center together around practical, tangible solutions to boosting social mobility in America.

And the good news is Bel's right. We need effective government. We need all sectors, business sector, involved and we need to accelerate our efforts to transform our educational system, which was created during an industrial economy to one that's much more nimble and provides multiple pathways for young people to grow.

MARTIN: I'm still struck, though, by this data by the Pew Charitable Trust's Economic Mobility Project, which of course, was done in conjunction with Brookings Institution, where a third of Americans raised in the middle class fell out of the middle class as adults. And I'm still struck by that. We're not just talking about a failure to rise. We're talking about like falling backwards.

And so I just have to ask, Bel Sawhill, what about that?

SAWHILL: Well, don't forget that what we're talking about here is what researchers call relative mobility, so if anybody rises, someone else has to fall. It's a kind of a shifting places on the ladder. And if you have economic growth, then everybody can rise together.

What's new is that in the early postwar II decades, the '50s and '60s and part of the '70s, we had strong economic growth and everybody rose together. Since the 1970s, we have had much more modest growth and most of it has been concentrated at the top of the income scale.

So there is an issue of both growth and mobility combined here that we need to pay attention to in terms of policy.

MARTIN: John, I'm going to give you the final word.

BRIDGELAND: I just say that, you know, America has lost its place in terms of educational attainment. The last century, coming out of World War II, was the human capital century when we focused like a laser on educating our population; the economy grew, and we had the qualified workers to fill the labor force. And we've lost our way, and so we need to have both sides come together around an effort to graduate more students from high school, graduate more students from one, two and four year degrees and have the credentials that they will need to compete in this globally competitive economy.

MARTIN: Obviously, this is a...

SAWHILL: I couldn't agree more.

MARTIN: All right. Well, then...

BRIDGELAND: Bel...

MARTIN: Well, this is a conversation that needs to continue and perhaps next time, we'll find some areas that there isn't quite so much agreement so we can sort of figure out what the impediments are to moving forward on this.

John Bridgeland is president and CEO of Civic Enterprises. That's a public policy and development firm. I want to mention he was a special assistant to George W. Bush and also is a member of the White House Council for Community Solutions under President Obama. He was here with us in our Washington, D.C. studios.

Joining us from the studios at the Brookings Institution, Isabel Sawhill, senior fellow of economic studies at Brookings, a research and policy group in Washington, D.C.

Thank you both so much.

BRIDGELAND: Thank you, Michel.

SAWHILL: Thank you, Michel.

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