Family, Wealth, And Privilege–The Keys To Success

There have been a number of articles recently – and once again – about the economic and social inequality of the United States.  Comprehensive data have shown that there is little generational movement from one economic quintile to another, and although there is significant variation by region, most people remain stuck where they started.  David Leonhardt in the New York Times (7.22.13) indicated that for children raised in top fifth of the urban population between 35-40 percent of them are likely to end up in that same quintile. For those raised in the bottom quintile only 5-10 percent of them are likely to rise to the top. It doesn’t seem to matter where families live so much as how they live. Wealthy families share the same socio-cultural characteristics which lead to success and mobility.  Poor families share those which tend to inhibit movement.

Economic mobility is a function of family wealth, education, economic opportunity, geographic advantage, and political climate shared more by the top 20 percent than the bottom. 

A child brought up poor in an isolated rural area of the South has few of the advantages of one raised in an affluent area of Washington, DC. His parents are likely to work two low-paying jobs.  He goes to a public school staffed by low-quality teachers and with few educational facilities.  He has little contact with children other than those like him, will likely drop out of high school to support his family, and will never progress beyond low-paying, menial jobs. His parents have few savings, if any, and cannot afford a move to a more economically promising area of the country. His parents themselves have been poorly-educated and cannot provide any of the intellectual stimulation, curiosity, or discipline needed to learn widely and well.

Poor urban families are often marginalized in dysfunctional inner-city neighborhoods with high rates of functional illiteracy, educational performance; and without the advantages of two-parent households, a culture of discipline and achievement, and varied opportunity.

The child of a high-earning professional family can look forward to the best private schools, summers abroad, shelves filled with books on theatre, history, and philosophy, lively dinner-table conversations about politics, culture, religion, and art.

The parents of such a privileged child have raised him from infancy to value hard work, discipline, inventiveness, creativity, and above all, success.  While such parents may not push their children to higher and higher socio-economic success as earlier generations of Americans did, today’s affluent young parents are insistent on maintaining the same level of intellectual sophistication, social skills, and business acumen. Perhaps most of all, they instill in their children a sense of confidence, purpose, and conviction.

Many critics have used these statistics to attack the ‘One Percent’.  In their eyes the wealth and achieved status of this class are suspect. It is as though families who use their position, background, connections, and high-achieving ethos are somehow undemocratic, insensitive to the plight of the poor.  They are insular, indifferent, and dismissive; happy to reside within enclaves of privilege.

There is no connection between the two. The ambition of a young professional family in Boston which marshals all its intellectual, social, and economic resources for the sake of its children is separate and distinct from the more routine, predictable, and harsh lives of the poor.  While one can argue in macro-economic terms about the effects of a high degree of concentration of wealth, it is wrong to criticize individual families for accumulating the wealth which will enable them to lead happy and productive lives and to assure the same for their children.

All of which leads to the inevitable question: What can we as a nation do to increase socio-economic mobility and to increase the chances of those in the lower quintiles to rise above them?  The arguments for an even more vigorous Government response on one side and those focusing on less State intervention on the other are well-known.  ‘Progressives’ propose more government spending on education, social welfare, and redistributive tax policies; and Conservatives favor more individual and community responsibility, private sector investment, and the energies and innovativeness of private enterprise.

Nothing seems to have worked well in the past; and although incomes have risen overall, and the standard of living of most all groups along with them, the incomes of the most well-off have increased at a more rapid rate than of the least.   This, too, is hardly surprising.  Wealth begets wealth.  A few dollars deposited in a savings account every two weeks will never earn the same as thousands invested in a real estate or the stock market.  Not only do the wealthy have money, they know what to do with it. Financial savvy is another of those valuable attributes passed from generation to generation.

The problem is that the debate on income inequality has remained political and polemical – the One Percent against the Ninety-Nine; the wealthy vs. the poor; the privileged vs. the underprivileged.  Politicians and lay observers alike continue to see the problem in Marxist terms – a class struggle which can only be resolved through major restructuring of the economic system. The real answer, however, lies in incremental change, one initiated by the individual but assisted by government. School voucher programs, for example, offer an opportunity for ambitious low-income families to escape the miasma of the dismal and dysfunctional public education offered to them. who, unlike most of their peers, subscribe to majority norms.

More fundamental is the progressive change in community attitudes. There is too much tolerance for anti-social behavior, too much nurturing of the culture of victimhood and racism, too great a reliance of government entitlements, and too much of a misplaced trust in venal and corrupt politicians offering short-term gains. The politicians of Washington or Detroit have done their citizens no favors whatsoever in signing unrealistic labor contracts, handing out government jobs, and spending beyond their means; and the citizens of those cities have gorged themselves for decades at the all-you-can-eat political buffet.

The situation is far worse in minority inner-city communities because there is a culture of entitlement which has persisted for years.  There is a solidarity between politicians and residents based on race.  ‘We’ means us black folk – united we stand, divided we fall.  While in the past this race-class unity has indeed been important for effecting major social changes in white society, it is now an impediment.  Community leaders who continue to play the race card (victimhood, racism, and entitlement) in an attempt to preserve political solidarity, fly in the face of a majority society which has moved on.

In other words, the more poor families take the initiative to reject anti-social values and norms, to seek opportunity outside of the confines of a racially-defined community; and the more community leaders publically reject old-school sloganeering and assume the role of teachers and moral advocates, the more incremental change will occur.

The plight of the white, working poor is even harder to address. On the one hand they are free from the confines of racial or ethnic categories, but on the other hand they have never benefited from the same collective efforts that has drawn attention to the plight of American blacks. They are on their own.  Fewer politicians seem to care about the more dispersed and less vocal residents of the rural South than they do about the more volatile inner cities of the Northeast.

There seems to be little hope for this class of Americans. Unemployment remains high because few businesses want to invest in states like Mississippi which ranks at the bottom of every socio-economic category. Labor-intensive jobs in agriculture have been replaced by mechanization, there has been little exploration or exploitation of any oil or gas reserves, there are no major port facilities.  There are no good future scenarios.

Given the experience of the past, it is likely that the socio-economic divide will remain as wide as it has ever been; but it is myopic to look only at broad demographic categories and to condemn the American enterprise system for failing to produce complete equality. There is a version of the American Dream operating today because of the transformation of the economy from manufacturing to knowledge. Ambitious, smart, and inventive young people can move out of the physical confines of their community or state, and join the virtual world.  Wealth and privilege will always provide a leg up to anyone, but the opportunities for advancement may not be as bleak as they once were for individuals.

Unfortunately, much of the United States will continue to resemble many big cities – prosperous, enterprising outer rings, and a hardcore, intractable, inner-city.  Mississippi is likely to remain in economic limbo for decades even as many of its most ambitious and talented young people join the cyber-stream out of town and as states with a better history, location, geography, and investment move rapidly ahead.  This is a fact of capitalism, an economic system which no one has described as fair.

In summary, it is time to stop blaming the wealthy and privileged for their success; to end the patronizing attitude of victimhood towards the urban poor; to accept the fact that capitalism is and will always be an ‘unfair’ system which offers limitless opportunities but guarantees nothing; to believe in incremental change and individual opportunity; and get on with it.