This chapter will closely connect with the conclusions of Part Four on “institutional failure” (Chapter Sixty), beginning to explore how institutional failure directly leads to the collapse of the core of the “American Dream”—economic prosperity and upward mobility. We will focus on analyzing how class mobility has fallen into a state of “freezing” across generations, thereby revealing the specific face of the broken American Dream at the economic level.

First Thesis: The Core Promise of the American Dream and Current Reality

I. The Definition of the American Dream: Intergenerational Upward Mobility

The core promise of the “American Dream” can be quantified as “absolute intergenerational upward mobility”:

Children must have better living conditions and economic status than their parents’ generation.

This promise is the cornerstone of the American social contract. During the “Great Prosperity” period after World War II, the vast majority of Americans believed in and experienced this mobility.

II. Current Reality: The Collapse and Freezing of Mobility

Current economic data shows that this core promise has collapsed, with class mobility in a state of “freezing”:

The Reversal of Absolute Mobility: Research shows that among Americans born in the 1940s, about 90% of children had higher incomes at age 30 than their parents; but among those born in the 1980s, this proportion has sharply declined to about 50%.

The Rigidity of Relative Mobility: Relative mobility (changes in socioeconomic status ranking) has also stagnated. The class one is born into has become the strongest predictor of one’s lifetime economic success.

Second Thesis: How Institutional Failure Leads to the Freezing of Mobility

III. The Fragmentation of Educational Opportunity: From “Ladder” to “Barrier”

Education was intended to be the primary “ladder” for upward mobility. However, institutional failure has transformed the education system into a “class barrier”:

Reliance on Local Property Taxes: American public school funding heavily relies on local property taxes. This leaves affluent communities (with high property values) possessing well-funded, resource-rich schools, while poor communities fall into a vicious cycle of underfunding and low educational quality.

Result: Children from poor families are on a completely different educational track from children of wealthy families from birth. This institutionally perpetuates class inequality across generations, directly freezing mobility.

IV. The Double Standard of the Tax System and the Concentration of Wealth (Chapter Fifty-Five)

The tax system’s “resistance” and elite escape directly freeze opportunities for wealth accumulation necessary for mobility:

Capital vs. Labor: The system encourages wealth accumulation through capital appreciation (low tax rates, Chapter Fifty-Five) rather than through labor income (higher tax rates, Part One).

The Freezing Mechanism: Wealthy families can perpetuate wealth across generations through low-tax capital gains, while lower-income families, whose income primarily comes from labor, accumulate wealth at an extremely slow pace. This leaves lower-income families lacking the initial accumulation needed to access the “capital ladder.”

V. Policy Lock-In Through Campaign Finance (Chapter Fifty-Four)

Money politics and vested interest groups (Chapter Fifty-Six) lock in policies that perpetuate conditions unfavorable to mobility:

Stagnant Wages: Campaign finance locks in policies favorable to capital (such as suppressing unions, stagnant minimum wages, opposing labor protections). This has caused workers’ wages to stagnate for decades (core thesis of Part One).

Financial Squeeze: Vested interests have locked in the high costs of higher education and unaffordable healthcare costs. These two factors mean that even if children from lower-income families obtain degrees, they may be crushed by massive debt, unable to achieve genuine upward mobility.

Third Thesis: The Dual Impact on Psychology and Society

VI. The Deprivation of Hope and Social Despair (Chapter Forty-Four)

The freezing of class mobility causes the deepest damage to social psychology:

“Irrational” Choices: When people realize that no matter how hard they work, their children’s lives will not be better than their own, the belief that “hard work leads to success” collapses.

Political Despair: This deprivation of hope is the root of “public despair” (Chapter Forty-Four), driving people to prefer a destroyer who promises to “smash the system” (Chapter Thirty-One), because the “status quo” offers no hope at all.

VII. The Irreversibility of Class Solidification

The freezing of mobility means American society is moving toward class solidification—a structural transformation that is difficult to reverse:

From “Opportunity Society” to “Inheritance Society”: Society is transforming from an “opportunity society” emphasizing individual effort to an “inheritance society” emphasizing the inheritance of wealth and privilege.

The Escalation of Social Friction: This solidification makes conflicts of interest, cultural differences, and mutual understanding between different classes increasingly difficult, accumulating fuel for the next stage of cultural civil war (the theme of the next part).

VIII. Chapter Conclusion: The Economic End of the Dream

Chapter Sixty-One establishes the first specific manifestation of the broken American Dream at the economic level: the death of its core promise.

Presentation of the Core Argument: Institutional failure directly leads to the freezing of class mobility, completely dismantling the hope of intergenerational upward mobility.

NEXT: Chapter 62: Economic Fragmentation II: Liberalism’s Self-Devouring — The Hollowing Out of the Real Economy by Financialization