Chapter 9: The Numbers Don’t Lie
Measuring the Death of the Dream
The destruction of the American Dream isn’t just an abstraction; it’s measurable. (See Chart 9.1)
In 1980 when Reagan was elected president, at the peak of the American Dream, fully two-thirds of American families were in the middle class. A single income could support a family, buy a house, take an annual vacation, send the kids to college, and even retire with dignity.
Today, only 43 to 47 percent of Americans qualify as middle class (depending on whose numbers and what criteria you use). And it takes two full-time incomes today to achieve what a single union job gave a family in 1980.
Consider wages. If wages had kept pace with productivity since 1980, the median American individual worker’s income would be over $100,000 today. Instead, it’s around $50,000. With help from the Reagan Revolution, that missing $50,000 has largely gone into corporate profits and executive compensation: in other words, into the money bins of the nation’s oligarchs.
Then there’s housing. In 1980, the median home price was about $47,000, roughly three times the median (single-worker) household income. Today, the median home price exceeds $400,000, while median household (two-worker) income is around $75,000. That’s more than five times the household income, and in many cities it’s ten times or more. People who could have bought a home in their twenties, like Louise and I did in the 1970s, now struggle to do so even in their forties.
The same is true of education. When I attended college in the late 1960s, I paid my tuition working part-time jobs. My mom paid her way through four years at Michigan State in the 1940s working summers as a lifeguard and propping airplanes. Today’s post–Citizens United students graduate with an average of $30,000 in debt, and total American student loan debt exceeds $1.7 trillion. We’re the only developed country in the world where this is true, and an entire generation is now starting life in a financial hole that previous generations never faced.
Or consider healthcare. In 1980, healthcare costs were 8.9 percent of GDP, and most hospitals and health insurance companies were required by state law to be nonprofits. Today, healthcare costs are nearly 20 percent of GDP, and half a million American families declare bankruptcy every year just because someone got sick. Medical bankruptcy like this doesn’t exist in any other developed country in the world. Only in America.
And then there are the under-siege unions. In 1980, about a third of American workers belonged to unions, so those union contracts established the wage floor for another third of American non-union workers. Today, after forty-five years of Reaganomics’ relentless assault grounded in corporate constitutional rights, union membership has collapsed to around 10 percent. When workers can’t organize, they can’t bargain for fair wages, so corporate profits and billionaire wealth soar while workers struggle.
Perhaps most grotesque, check out wealth concentration. In 1980, the top 1 percent owned about 20 percent of all wealth. Today, they own over 35 percent. The top 0.1 percent, one in a thousand Americans, owns more wealth than the bottom 90 percent of all Americans combined. Just three white men own more wealth than the entire bottom half of Americans.
This is the economic and political landscape that is today’s America, courtesy of corporate constitutional rights. The RAND Corporation calculated that between 1975 and 2018, fully $50 trillion was transferred from the bottom 90 percent of Americans to the top 1 percent, every penny stolen from working families and transferred to the oligarchs created by these corrupt Supreme Court decisions.
That’s not capitalism or even so-called free markets. It’s naked theft, enabled by made-up corporate constitutional rights and protected by a political system that the nation’s wealthiest corporations now control.
These numbers should have sparked revolution. When two-thirds of wealth gains go to the top 1 percent, when working families can’t afford what their parents had, when the American Dream visibly dies, studies and history show that such inequality provokes mass movements that topple oligarchies.
So how did they get away with it? How did they steal fifty trillion dollars in broad daylight without facing a democratic revolt?
They had a strategy that involved deflection, scapegoating, and blaming their victims, making sure the anger went elsewhere.
The Cover-Up and Deflection Scam
As Reagan’s Revolution destroyed the union movement, transferred over $50 trillion from working-class people into the money bins of the top 1 percent, and crushed the middle class, people began to get angry.
They saw their pensions dissolved in corporate bankruptcies, their jobs sent to foreign factories, and their wages essentially frozen for more than four decades. Opportunities faded, education became absurdly expensive, healthcare started bankrupting families, and a simmering rage began to fill America.
Responding to this, the GOP and their oligarch-owned media began a multi-decade campaign to blame the collapse of the middle class first on women and Black people entering the workforce, then on immigrants, and generally on “liberals” and “socialists.”
It’s a strategy that’s worked for fascist regimes in the past: Hitler, Mussolini, Putin, and Orbán all did the same. And it was effective enough to get Trump elected twice.
But the deflection scam and the cover-up it concealed is starting to crack under the scrutiny of a new generation of young Americans. They’re figuring out what happened and how it came about, even if most don’t know the nineteenth-century backstory.
The simple reality is that the American Dream didn’t fade away: it was murdered, and corporate constitutional rights were the murder weapon.