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Strain Book Warns of the Danger of Populist Pessimism

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Is overblown pessimism about a lack of opportunity for upward mobility for average Americans endangering U.S. democracy?

The American Enterprise Institute’s Michael Strain argues yes in his new book, The American Dream is Not Dead (But Populism Could Kill It). Strain, the director of economic studies and the Arthur F. Burns Scholar in Political Economy at AEI, gave an overview of his argument Thursday in a book event at the conservative thinktank.

Strain, who was joined by AEI’s Yuval Levin and Richard Reeves of the Brookings Institution – who offered a friendly rebuttal to the book’s thesis – stressed that he is not arguing that specific segments of American society aren’t facing significant economic headwinds and a lack of wage growth.

“I’m not trying to diminish or sugar coat or ignore any of the real problems we face. Instead I am trying to be accurate,” Strain said. “We are focusing so much on these pockets of real struggle that we are mistaking those pockets of struggle for the common experience.”

Strain maintained that the widespread notion that wages and income have been stagnant for the bulk of American workers is simply not true. One of the many statistics he employed was a graph showing that 73 percent of U.S. adult children in their 40s have higher incomes than their parents did at the same age.

“The economy is delivering,” Strain said. “Wages and incomes have not been stagnant for typical workers over the past three decades.” Strain acknowledged, however, that working-class wages have not risen fast enough, or as fast as those at the top of the economic pyramid.

Another central idea of Strain’s book is that the pessimistic narrative about the death or diminishment of the American dream is hugely damaging to the nation’s sense of confidence and appetite for entrepreneurial activity.

One of the few things both parties agree on is that the American dream is desperately endangered, Strain said, noting that the belief is something that political figures as disparate as Sen. Bernie Sanders (I-VT) and President Trump or Sen. Elizabeth Warren (D-MA) and Fox News host Tucker Carlson have in common.

“The national conversation assumes that the American Dream is dead,” Strain said. “My point in this book is that that consensus is misplaced.”

Reeves, the John C. and Nancy D. Whitehead chair and director of the Future of the Middle Class Initiative at Brookings, joked that as a progressive, he found Strain’s book to be “irritatingly” well argued.

He agreed that there is a “bipartisan overstatement” of the lack of opportunity and upward mobility for most Americans. “There’s something rather dull and stupid about optimism in too many of our minds,” Reeves said. But he cautioned that Strain’s analysis is a bit too rosy. “We’re not in great shape either,” Reeves said. He particularly stressed that the federal government continues to have a key role to play in trying to even the economic odds for disadvantaged communities and has played a vital role in the gains that have been seen over the past three decades.

Both men agreed during a brief question and answer session that the current populist mood presents a real danger to a sense of American optimism and the functioning of key government and societal institutions.

“It is not true that the game is rigged,” Strain said, adding that the idea presents “the double threat of populism  . . . the impact on our institutions and policies as well as the narrative.”

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