The American Nightmare
"If we kill the rich," Vicky Ward asks in yesterday's Huffington Post, "don't we kill the dream?"
There may well be a dream on the line, but it's not the one Ward's worried about -- namely, "the American dream of meritocracy," which allegedly "Congress is trying to strangle." In fact, of all the misdeeds carried out on the southern tip of Manhattan over the last decade, perhaps Wall Street's greatest fraud was to arrogate the very meaning of the American Dream. What Ward and others are peddling as an American Dream -- and what lies on its deathbed today -- is not that storied Dream, but an ersatz ideology, a vision corrupted, distorted, perverted and bastardized; in short, a nightmare.
Speaking to the Democratic Leadership Committee in 1993, Bill Clinton called the American Dream a "simple but powerful one -- if you work hard and play by the rules you should be given a chance to go as far as your God-given ability will take you." And what does God have to say on the issue? Luke 16:13: "No servant can serve two masters. Either he will hate the one and love the other, or he will be devoted to one and despise the other. You cannot serve both God and Money." While the American credo stops short of condemning profit, it was never intended to equate the two.
Looking back on the origin of the American Dream trope, as David Kamp does in this month's Vanity Fair, there was not, from the get-go, "any promise or intimation of extreme success in the book that popularized the term," as Kamp writes of James Truslow Adams' The Epic of America. Nor was astronomical wealth the "dream" promised in Horatio Algers' rags-to-riches stories. In Ragged Dick, Alger's first great success, the protagonist winds up a clerk, happily ensconced in the middle -- and not the upper- upper -- class.
In 1907, Burton J. Hendrick authored an anti-Semitic piece in McClure's Magazine called "The Great Jewish Invasion." Manhattan's Jews, Hendrick wrote, "are not what are commonly regarded as the most enlightened of their race." Yet among his accusations of money-grubbing, Hendrick admitted that the Jews' "enthusiasm for America knows no bounds." He continued: "The rapidity with which the New York Jew adopts the manners and trappings of Americans almost disproves his ancient heritage as a peculiar people...Better than any other element, even their native stock, do they meet the two supreme tests of citizenship: they actually go to the polls, and when once there, vote independently."
Even in this city -- what Ward today calls the "national epicenter of ostentation and consumerism" -- a bigoted commentator could distill from the basest of stereotypes the true nature of the American Dream: the litmus test was not a paycheck, but a ballot.
Yet in the last half of the last century, something changed. Americans started betting, in the words of Joe Nocera, "that tomorrow would be better than today." Consumer credit swelled in the 1960s, and was underwritten in the 1970s by the rise of credit cards. The gold rush reached its apotheosis in the 1980s, when under Ronald Reagan, the American Dream was finally "decoupled from any concept of the common good," as Kamp writes, "and, more portentously, from the concepts of working hard and managing one's expectations."
Thus, Michael Lewis, the author of Liar's Poker, who wrote recently of his own foray into the so-called American Dream: "I'd never taken an accounting course, never run a business, never even had savings of my own to manage. I stumbled into a job at Salomon Brothers in 1985 and stumbled out much richer three years later, and even though I wrote a book about the experience, the whole thing still strikes me as preposterous."
The American Dream had, and has, become a farce. Over at AIG, Edward M. Liddy is grumbling that they "cannot attract and retain the best and the brightest talent" if those much-bemoaned bonuses aren't paid out. But as Judith Warner recently asked, "When was it, exactly, that the titans of Wall Street, among their many other perks and privileges, got to be crowned with the title of best and brightest'?" In other words, why should Wall Street occupy the vanguard of the American Dream?
Under their watch, we saw the American Dream supersized and subsidized. As economist Robert H. Frank writes in the Sunday Times, "Trillions of dollars, many of them borrowed from China, financed tax cuts for the wealthy, who spent much of their added wealth on things like bigger mansions. But beyond a certain point, when everyone builds bigger, the primary effect is merely to raise the bar that defines the size of home that people feel they need."
This was an American Dream bought on the cheap. In the ugliest sense of the word, it was bigger, but in no ways loftier.
The anecdote Ward leads with is something a hedge-fund manager told her at dinner: "If your only identity is in your job or your money then there is no point living in New York anymore," he said. "Anyone who thinks like that will leave."
And good riddance. In this month's Atlantic, Richard Florida predicts that "the financial crisis may ultimately help New York by reenergizing its creative economy." New York has become a haven for people whose personhood begins and ends with their wallets. As the urbanist Jane Jacobs told Florida, "When a place gets boring, even the rich people leave." "With the hegemony of the investment bankers over," Florida concludes, "New York now stands a better chance of avoiding that sterile fate."
As the nightmare passes, there will be time to repair, revitalize and, yes, rethink the American Dream. And with any luck, we'll soon be stewing over bonuses for overpaid Huffington Post writers.
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The gold rush reached its apotheosis in the 1980s, when under Ronald Reagan, the American Dream was finally "decoupled from any concept of the common good," the exact moment it began when he became Cal. governor and prop. 13 passed.
hanks paulsons lies are the american dream of guy going to ivy league
school and learning how to steal from government
The American dream was a Buick in the drive way, a chicken in the pot and 2 kids in school - not $Billions of personal wealth; that is the true perversion of the AmDr
lol...i thought it said the "american dream of mediocrity
Very interesting and compelling piece, Rob. I'll be paying close attention to how New York can revitalize its creative economy, given the financial losses to endowments that have, at least in recent memory, been integral to the city's artistic and cultural vibrancy. Any thoughts on how that might evolve? Is the financial crash in Argentina, described by Naomi Klein in The Shock Doctrine, the only model we have for how an economy can reinvent itself during times of hardship?
can you explain what a cultural quo is?
I believe New York's artistic & cultural vibrancy will be just fine ( & might even be better) The city has always been a mecca for great artists, writers, musicians & performers because it has the one thing that the Arts needs above all others.... a huge, diverse audience. You may have to look a little harder, and in more unexpected places, but I think you'll be pleasently surprised at the quality and originality of works created and exhibited & performed by those with the most talent & passion instead of just those with the best ability to win grants & endowments.
Reminds me of my stepfather. The guy sold mutual funds for a living and wanted me to come and work for him instead of pursuing my career as a print designer.
His argument went something like I could work for him for a few years (decades more like) and make so much money that I could build a studio and do whatever I wanted with it without the need for those pesky customers. Then I'd say I kind of liked some of those customers and he's say 'oh, then you can pick and choose who you work for.' And I'd say, I can pretty much do that now, thanks.
Making imaginary money, not the kind of lifestyle I see myself feeling very satisfied about.
The money in the economy didn't just disappear into a black hole. That money still exists, it's just not in circulation anymore. It sits in the bank accounts of the wealth holders who benefitted from Bush's tax cuts. It only took 8 years of making MASSIVE profits and paying no taxes on those profits to drain the economy dry. It will never "trickle down". It will sit in those wealthy people's bank accounts until their children's children's children eventually spend it. But they will always make more money than could possibly be spent, so they will continue being wealthy forever. But since we live in a capitalist system, those wealthy people's children have a huge advantage over the rest of us. To participate in capitalism, you have to have capital. By taking all that money away from us and giving it to the wealthiest people on Earth, we just ensured that the wealthy families will continue to control the system for generations to come. All that wealth they have accumulated for the past 8 years will influence elections, pay off lobbyists to bribe Congress, and basically keep them obscenely wealthy FOREVER.
Most of the money created isn't there. It was just imaginary wealth, AIG's insurance policies. There was no production of capital happening on Wall Street so there can be no true wealth creation just insurnace paper. What they can do is create the appearance of wealth. And that they did.
Its like gambling with insurance money. You don't really have the money. The problem is that so many of the gamblers lost at once that the insurance company can't cover all the bets.
Rather than treating the bankers the way we would be treated, Obama is giving them our money to bet with. So....the good times will continue and there is no lesson learned. Well, the lesson is for us to learn. We are ruled by the banks and there isn't anything Obama will do about it.
So working hard is just a waste of time. No matter how hard you work the banks will take all the money. Trillions of it.
Good Point! This is an important concept - the CDO worth 100 is now worth 10 - that is the econo crisis in a nut shell.
Highers taxes force people to spend the money back into the economy and to re-invest to defer taxation. The Estate tax on huge estates helps prevent the accumulation of wealth in the hands of a few families. The progressive tax on incomes only prevented the extremely wealthy from becoming obscenely wealthy.
Wealth has to be re-distributed since we do not have the tradition of "noblesse oblige" in America.
In Germany, everyone takes great pride in their cities and national monuments. You don't see violent slums with people living in crack houses. Infrastructure is constantly repaired. No abandoned cars litter the country side. Medical care is provided by the government.
Germany is almost a utopia compared to our cities and they were bombed out in the wars but rebuilt both times. It is really an eye-opener about the "evils of a socialist government
All hail to a time when people can tell you what they do for a living in English.
"Oh yes, I am a derivatives trader for a hedge fund.' Nice, do you have to wear a name tag and a hairnet on that job?
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