White House aid Stephen Miller made headlines last week over his contentious exchange with a CNN reporter during a press briefing about a new immigration bill. Miller made various bold claims about the bill’s benefits, one being that it would reduce “wealth inequality,” provoking backlash from the Huffington Post and the Washington Post.
Income inequality is a popular enemy for politicians to attack. President Obama called income inequality the “defining challenge of our time,” and Senator Bernie Sanders famously railed against “the top one-tenth of the top 1 percent” for months during the 2016 election. President Trump won the office because he appealed to low- and middle-class Americans who felt left behind in the age of globalization.
Conservatives tend to brush off concerns about inequality. After all, in the free market, we’re rewarded based not on our class status, but on our own abilities. Right?
Sadly not, argues Richard Reeves. In his new book, Dream Hoarders, Reeves argues that the upper middle class, or the top 20 percent, is “hoarding” the American Dream.
Reeves uses statistics to show that there is both a poverty trap and a wealth trap in America; children born wealthy will stay wealthy, while children born poor will stay poor. Data from the University of Michigan’s Population Studies Center show that 37 percent of children raised by families in the top 20 percent of incomes remain there as adults, while at least a third of children raised in the bottom 20 percent stay there.
Why is this? Reeves first points to unequal development of human capital.
By unequal development of human capital, Reeves is talking about parenting and education. Upper middle class parents are more likely to be married, and they’re more likely to plan their pregnancies. A study at the Columbia School of Social Work found that parenting behavior, namely maternal warmth and sensitivity, to be the most important factor of the gap between upper middle class children and bottom-income quintile children. In other words, parenting behavior is more important than maternal education, family size, and race.
Furthermore, upper middle class children generally live in neighborhoods with high-performing public schools, or they attend posh private schools. Upper middle class parents can hire college admissions consultants for upwards of $5,000 to guarantee that their children attend a selective college. Not to mention that most upper middle class parents have often gone through the college admissions process themselves and can help their children succeed.
But all these behaviors should be lauded, not discouraged. Why shouldn’t parents spend time with their children, read with them, and do all that they can to send them to a good school? These behaviors are clearly not wrong, but Reeves does suggest some reforms to equalize the playing field for lower-income children. He suggests reducing unintended pregnancies through better contraception, improving parenting among low-income parents by funding home-visiting programs that build parenting skills, getting better teachers at underachieving schools by paying more to work in those environments, basing student loan repayment levels on income, and simplifying the college financial aid application process.
Unfortunately, Reeves chooses not to promote school choice as a solution to inequality in education. This is surprising because upper middle class parents already have school choice—they can afford to pay to send their children to the school that works best for them. School choice would give children from disadvantaged backgrounds the same opportunity to attend a good school––a large step toward equal opportunity.
When Reeves talks about “opportunity hoarding,” he’s referring to certain behaviors the upper middle class engages in to rig the competition in favor of their children. In order to give all children the chance to succeed, Reeves suggest that we curb exclusionary zoning, especially density requirements that prevent multi-family homes from being built in wealthy areas; end legacy admissions at the top colleges in America that inevitably give preference to upper middle class children; and open up internships by increasing regulatory oversight and extending student financial aid to cover summertime opportunities.
There are certainly barriers to economic mobility in America. Some of these are natural results of upper middle class families having more resources and others come from harmful government programs. But even if relative mobility is decreasing in America, absolute mobility is alive. Gallup’s standard of living index has more than doubled from 2008 to 2015, demonstrating that Americans view their economic situation as getting better, not worse. Relative mobility is concerned with whether people bypass others when their incomes increase, while Absolute mobility is concerned with whether incomes increase or decrease. Over time, everyone can be better off as the economy grows. Why do we need downward mobility from the top? If everyone’s standards of living are rising, why do we need to be concerned with class status?
Reeves makes a convincing argument for the importance of relative mobility when he writes, “increasing the number of smart, poor kids making it to the top of the labor market is likely to mean an improvement in quality and therefore productivity.” Upper middle class people are top influencers in society; they are politicians, pundits, broadcast journalists, and financial analysts. These people should be the most talented people in society, not just the ones lucky enough to be born to rich parents because that is best for the economy. To give one of many examples, a working paper published by the National Bureau of Economic Research determined that fund managers from low-income backgrounds perform better than those from upper middle class backgrounds.
Reeves points out a problem that should alarm conservatives and liberals alike. Equality of opportunity is the cornerstone of the American Dream. Our identity as a country is founded on the idea that everyone should have a fair chance to succeed, no matter who you are or where you grew up. The American Dream is still alive, but it’s far more difficult to obtain for some than others. Policymakers should refocus on equalizing opportunity rather than fighting income inequality.
Amelia Irvine is a Young Voices Advocate studying government and economics at Georgetown University. You can follow her on Twitter here.