Editorial: Challenging mobility assumptions

Even though social movements have delivered better career opportunities for women and minorities and government grants have made college more accessible, one thing has stayed constant: If you are growing up poor today, you appear to have the same odds of staying poor in adulthood that your grandparents did.

The upshot? Children growing up in America today are as just as likely — no more, no less — to climb the economic ladder as children born more than a half-century ago.

That's the bottom line of a landmark study from a group led by Harvard University's Raj Chetty, which suggests that any advances in opportunity provided by expanded social programs have been offset by other changes in economic conditions. Increased trade and advanced technology, for instance, have closed off traditional sources of middle-income jobs.

The findings also imply that who your parents are and how much they earn is more consequential for American youths today than ever before. That's because the difference between the bottom and the top of the economic ladder has grown much more stark, but climbing the ladder hasn't gotten any easier.

These findings add up to a surprising take on the status of the American Dream, and they cast Washington's debate about the consequences of economic inequality in a new light.

The paper suggests that "it is not true that mobility itself is getting lower," said Lawrence Katz, a Harvard economist. "What's really changed is the consequences of it. Because there's so much inequality, people born near the bottom tend to stay near the bottom, and that's much more consequential than it was 50 years ago."

Americans have always placed great faith in economic mobility, the idea that any child born into poverty can grow up to be middle class, or that a middle-class kid can grow up to be rich.

Chetty and his colleagues examined millions of anonymous earnings records and found that mobility has not changed appreciably since the 1970s.

Incorporating results from a previous study dating back to the 1950s, the authors concluded that "measures of social mobility have remained remarkably stable over the second half of the 20th century in the United States."

That finding implies mobility is stuck at a low rate, at least compared to other wealthy nations: It is much harder for a poor child born in America to climb into the rare air of the country's highest earners than it is for a similar child in, for example, Canada or Denmark.

David Autor, an economist at the Massachusetts Institute of Technology, called the findings "a sort of Rorschach" test that will support many economists' preconceived notions about the effectiveness of government programs in providing opportunity.

Some could view the results as a failure of programs such as Pell grants, Head Start and nutritional supplements for children that are intended to promote mobility. Or, he said, "you can view this as: Social policies have fought market forces to a draw."

The findings from Chetty and his co-authors are likely to set off a new round of debate over mobility and inequality, which President Barack Obama recently called "the defining challenge of our time."

There's something in the paper to challenge both political parties' approaches to the issue. It suggests that both sides are wrong to talk about mobility declining. It explicitly calls into question the idea invoked by the Obama administration that widening inequality will depress mobility over time.

But the findings also suggest that Republicans are wrong to downplay inequality and focus solely on improving mobility.

© 2014 Washington Post

Editorial: Challenging mobility assumptions 01/23/14 [Last modified: Thursday, January 23, 2014 5:28pm]

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