The part of the American dream that says a man's children will be better off than he was, has become a dream, not reality, according to an analysis of Census data released yesterday.
A generation ago, American men in their 30s had median annual incomes of about $40,000 compared with men of the same age who now make about $35,000 a year, adjusted for inflation.
That's a 12.5 percent drop between 1974 and 2004, according to data from the Pew Charitable Trusts' Economic Mobility Project.
To be sure, household incomes rose during the same period although the main reason is because there are more full-time working women, a new report on the project said.
While income is not the only measure of economic mobility, the findings challenge the historical presumption that each successive generation will be wealthier, said John E. Morton, the report's co-author.
"Today's data suggest that during a 30-year period of economic expansion, a rising tide did not lift all boats," Morton said in a release accompanying the report, "Economic Mobility: Is the American Dream Alive and Well?"
Of course, the men who run American companies don't have too much to complain about. CEO pay increased to 262 times the average worker's pay in 2005 from 35 times in 1978, according to the report's analysis of Congressional Budget Office statistics.
The pay gap between executives and the average worker continues to fuel outrage on Capitol Hill and among corporate shareholders nationwide. Many shareholder proposals to tie executive pay to a company's operating or market performance are introduced at corporate annual meetings every year.
Most Democrats favor giving shareholders at public corporations a voice in executive pay packages, while the White House and many Republicans favor a laissez-faire approach that includes regulators ensuring executive pay is transparent to workers and investors.
The Pew report also found that in numerous countries, including Denmark, Norway, Finland, Canada, Sweden, Germany and France, there is more economic mobility than in the U.S., when measuring by the income differences between generations.
Over the next 18 months, the Pew project, which started in February, will continue to unveil analyses of data about the status of U.S. economic mobility.
For additional health information, visit OhioHealth
