The American Dream -- the notion that anybody, regardless of background, can achieve financial stability and build a secure life for his or her family -- is a huge part of America's self-identity. For centuries, it has been enshrined in our literature, in our history and in our politics. It is, in many ways, the most important aspect of life in this country.
However, a recent study suggests that, like so many other American things, the American Dream may have been outsourced to other countries. Specifically, the 26 other countries where median wealth is higher than in the U.S.
Credit Suisse's annual Global Wealth Data Book publishes a ranking of median wealth in countries around the world. Basically, this study looks at the sum of all assets, subtracts all liabilities, and comes up with the amount of money that the household in the middle of the wealth distribution can put its hands on. As one might expect, rich enclaves like the UAE (21) and Luxembourg (2) did well. Similarly, countries with a strong social safety net -- like Canada (12), Sweden (24), and Germany (23) -- also outpace us. But there are a few surprises, too. For example, the U.S. ranks behind Ireland (18), Spain (20) and Cyprus (25), countries that are generally recognized for their abysmal economies.
Why does America rank so low? The answer shouldn't come as a surprise to anybody who watches the news: To begin with, financial deregulation has concentrated wealth at the top of the income pyramid, wage stagnation has made life harder for workers, and the shredding of America's social safety net has made it ever more difficult for people to climb out of poverty. If you're interested in seeing a more comprehensive explanation, Les Leopold has written a pretty solid rundown.
The other side of the story -- and another aspect that makes this income inequality even more appalling -- is that, while the Global Wealth Data Book's numbers are based on the average of all households, the wealth held by the richest of the rich badly skews the equation. As this video notes, the top 1 percent of households own almost 50 percent of all stocks, bonds, and mutual funds. By comparison, the bottom 50 percent of all households own 0.5 percent of those wealth instruments.
Or, to put it another way, the middle class dream is alive and well in America -- as long as you're part of the upper class.
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