Americans Say Dream Fading as Income Gap Hurts Chances

Dec. 11 (Bloomberg) -- By almost two to one -- 64 percent to 33 percent -- Americans say the U.S. no longer offers everyone an equal chance to get ahead, according to a Bloomberg National Poll. Michael McKee reports on "The Real Deal" on Bloomberg Television's "In The Loop." (Source: Bloomberg)

The widening gap between rich and poor is eroding faith in the American dream.

By almost two to one -- 64 percent to 33 percent -- Americans say the U.S. no longer offers everyone an equal chance to get ahead, according to a Bloomberg National Poll. And some say the government isn’t doing much to help.

“There’s a lot of policies that make it easier for the rich to get richer and the poor to go nowhere,” says Ryan Sekac, 26, a mechanical engineer in Westerly, Rhode Island.

The Dec. 6-9 poll follows public statements by leaders, from President Barack Obama to Pope Francis, expressing alarm about growing income inequality. The richest 10 percent of Americans last year earned more than half of all income, the largest total since 1917, according to Emmanuel Saez, an economist at the University of California at Berkeley.

“Everyone on both sides of the aisle talks about the American dream,” says Sekac. “Right now, that’s not something everyone in this country can aspire to.”

Still, respondents are almost evenly split on the need for government action to narrow the income gap: 45 percent say new policies are needed, while 46 percent say it would be better to allow the market to operate freely even if the gap gets wider.

Photographer: Karen Bleier/AFP via Getty Images

A homeless person sleeps at the entrance of a Metro station near the White House, on March 28, 2013 in Washington, DC. Close

A homeless person sleeps at the entrance of a Metro station near the White House, on... Read More

Close
Open
Photographer: Karen Bleier/AFP via Getty Images

A homeless person sleeps at the entrance of a Metro station near the White House, on March 28, 2013 in Washington, DC.

Spanning Incomes

The lack of faith is especially pronounced among those making less than $50,000 a year: By a 73 percent to 24 percent margin, they say the economy is unfair. Even 60 percent of those whose annual income is $100,000 or more bemoan the absence of a fair deal while 39 percent say everyone has an equal shot to advance.

In recent weeks, public attention to the rich-poor gap has mounted. Obama gave a speech last week saying economic trends have “jeopardized middle-class America’s basic bargain, that if you work hard, you have a chance to get ahead.”

That address followed the pope’s Nov. 26 criticism of inequality. “Such an economy kills,” the pontiff said.

Obama’s rise from humble origins to become the first black U.S. president has done nothing to ease public concern.

“More people who are of color get opportunities now than they did,” but a lack of education holds too many back, says David Bakker, 56, a model-train builder in Baltimore.

In the Bloomberg poll, 68 percent of Americans say the income gap is growing, while 18 percent say it is unchanged and 10 percent say it’s shrinking.

Public Divided

While the public is divided over whether the government should take steps to close the income gap, support for greater action is strongest among lower-income Americans, with 52 percent saying officials should do something and 35 percent putting their faith in the market.

Photographer: Spencer Platt/Getty Images

A man waits for a bus next to a retail store in the Brooklyn borough of New York. Close

A man waits for a bus next to a retail store in the Brooklyn borough of New York.

Close
Open
Photographer: Spencer Platt/Getty Images

A man waits for a bus next to a retail store in the Brooklyn borough of New York.

The U.S. does less to reduce inequality through tax and transfer policies than most advanced nations, including the U.K., Ireland or Spain, according to Janet Gornick, a professor of political science and sociology at the City University of New York Graduate Center.

Before taking into account government policies, U.S. inequality isn’t much different than countries such as Denmark and Sweden, she says.

Bakker says the 1950s was “a golden age in the U.S.,” when the top marginal tax rates exceeded 90 percent. He says the government could do more to provide greater educational opportunities for low-income Americans.

“You’re not going to kill the economy by increasing the tax rate on those who benefit the most from the country’s infrastructure,” he says.

Little Faith

High-income respondents split almost evenly on the need for government action. Middle-income Americans, those making $50,000 to $100,000, favor relying on the market by 54 percent to 39 percent.

Some have little faith that either the government or the free market will bring them relief. Diane Kraft, 54, a homemaker in Denton, Texas, says she recently quit her job as a grocery cashier after her employer reduced her hours because of the new health-care law, the Patient Protection and Affordable Care Act.

Now, as she searches for a new job, she says she finds herself competing with Mexican immigrants who will work for less. “The government keeps taking and taking and taking from us,” she says. “Eventually, people are going to strike back.”

Remarks Resonate

The pope’s recent remarks have resonated with Catholics and non-Catholics alike. By 64 percent to 27 percent, poll respondents agree that government leaders should pay more attention to income inequality and less to the needs of the market.

By 56 percent to 35 percent, they endorse his criticism of “trickle-down” economics, which provides tax cuts for the wealthy as a means to spur job growth. And 66 percent say they have a favorable view of the pontiff compared with just 13 percent who view him unfavorably.

“I think he’s spot on,” says Donald Gottesman, 48, a foundation executive in Los Angeles. “I’m Jewish, so I don’t have any particular reverence for the pope. But he’s really thinking about what’s happening out there and trying to speak from his pulpit and cause change.”

The public’s view of the economy has improved somewhat from the September Bloomberg poll, which was conducted in the days before a partial government shutdown.

More Americans say the economy is getting stronger: 33 percent see improvement, compared with 27 percent who said that three months earlier, while 25 percent say conditions are worsening. Forty-one percent say the economy is about the same as the last 12 months.

Job Growth

With the economy generating an average of 189,000 jobs per month so far this year, 40 percent say job growth is improving, up from 36 percent in September. Twenty-seven percent say the employment market is getting tougher.

“I feel like it’s slowly moving forward,” says Albert Marini, 66, a retired information technology manager in Virginia Beach, Virginia. “We’ll probably have an OK year next year.”

The effects of rising inequality shadow any economic discussion. Marini says his son, a mechanical engineer, is able to give his two granddaughters the education they need to get ahead. Not everyone is so fortunate.

“If we don’t address it, it’ll just continue to deteriorate, the gap will just continue to get bigger,” says Marini. “And who knows what that will lead to in 10 or 15 years? Social unrest? Economic unrest?”

The survey of 1,004 adults was conducted by Selzer & Co., a Des Moines, Iowa-based pollster. Results carry a margin of error of plus or minus 3.1 percentage points.

To contact the reporter on this story: David J. Lynch in Washington at dlynch27@bloomberg.net

To contact the editor responsible for this story: Jeanne Cummings at jcummings21@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.