What is the most important factor blocking social mobility in the US? It could be single parents, not economic inequality
This week, in his State of the Union address, President Obama is expected to return to a theme he and many progressives have been hitting hard in recent months: namely that the American Dream is in trouble and that growing economic inequality is largely to blame. In a speech to the Center for American Progress last month, Obama said: "The combined trends of increased inequality and decreasing mobility pose a fundamental threat to the American Dream." Likewise, New York Times columnist Paul Krugman recently wrote that the nation "claims to reward the best and brightest regardless of family background" but in practice shuts out "children of the middle and working classes".
Obama and Krugman are clearly right to argue that the American Dream is in trouble. Today, poor children have a limited shot at moving up the economic ladder into the middle or upper class. One study found that the nation leaves 70 per cent of poor children below the middle class as adults. Equally telling, poor children growing up in countries like Canada and Denmark have a greater chance of moving up the economic ladder than do poor children from the United States. As Obama noted, these trends call into question the "American story" that our nation is exceptionally successful in delivering equal opportunity to its citizens.
But the more difficult question is, why? What are the factors preventing poor children from getting ahead? An important new Harvard study that looks at the best community data on mobility in America – released this past weekend – suggests a cause that progressives may find discomforting, especially if they are interested in reviving the American Dream for the 21st century.
The study, Where is the Land of Opportunity?: The geography of intergenerational mobility in the United States , authored by Harvard economist Raj Chetty and colleagues from Harvard and Berkeley, explores the community characteristics most likely to predict mobility for lower-income children. It specifically focuses on two outcomes: absolute mobility for lower-income children – how far up the income ladder they move as adults &ndash and relative mobility – how far apart children who grew up rich and poor in the same community end up on the economic ladder as adults. When it comes to these measures, the Harvard study asks which factors are the strongest predictors of upward mobility.
1. Family structure. Of all the factors most predictive of economic mobility in America, one factor clearly stands out in their study: family structure. By their reckoning, when it comes to mobility, "the strongest and most robust predictor is the fraction of children with single parents". They find that children raised in communities with high percentages of single mothers are significantly less likely to experience absolute and relative mobility. Moreover, "children of married parents also have higher rates of upward mobility if they live in communities with fewer single parents". In other words it looks like a married village is more likely to raise the economic prospects of a poor child.
What makes this finding particularly significant is that this is the first major study showing that rates of single parenthood at the community level are linked to children's economic opportunities over the course of their lives. A lot of research – including new research from the Brookings Institution – has shown us that kids are more likely to climb the income ladder when they are raised by two, married parents. But this is the first study to show that lower-income kids from both single and married-parent families are more likely to succeed if they hail from a community with lots of two-parent families.
2. Racial and economic segregation. According to the study, economic and racial segregation are also important characteristics of communities that do not foster economic mobility. Children growing up in communities that are racially segregated, or cluster lots of poor kids together, do not have a great shot at the American Dream. In fact, in this study, racial segregation is one of only two key factors – the other is family structure – that is consistently associated with both absolute and relative mobility in America.
3. School quality. Another powerful predictor of absolute mobility for lower-income children is the quality of schools in their communities. Chetty and his colleagues measure this by looking at high-school dropout rates. Their takeaway is that poor kids are more likely to make it in America when they have access to schools that do a good job of educating them.
4. Social capital. In a finding that is bound to warm the heart of their colleague, Harvard political scientist Robert Putnam, Chetty and his team find that communities with more social capital enjoy significantly higher levels of absolute mobility for poor children. That is, communities that have high levels of religiosity, civic engagement, and voter involvement are more likely to lift the fortunes of their poorest members.
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