Reinventing the American Dream
Dispatch from Nadene LeCheminant
For past generations the American dream stood for the promise of attainable comfort and security. More recently, a myopic focus on growth has created a dream that promotes unbridled consumption, but the “more is better” version actually harms the very things we cherish. It is unsustainable personally, as it draws American families into a work-and-spend treadmill that clutters our lives and depletes our savings. It is also unsustainable for the planet and its people.
—The Center for a New American Dream
THE WORST OF TIMES TO THE BEST OF TIMES — AND BACK
Fueled on hope and cheap gasoline, Gus Moore ’34 and his friend drove all night to make it to Willamette’s 1929 freshman orientation. A month later the stock market collapsed — his bank failed, his savings account was wiped out and his scholarship was withdrawn for lack of funds. “I thought the world was coming to an end,” the 97-year-old says. Mary Downey ’41 agrees: “People lost everything back then, their jobs and their savings, and there was no government help.”
During the Depression the American dream for most Willamette students meant simply getting through the day. Moore spent nights pushing a mop in Waller Hall for 25 cents an hour, and professors were lenient when students turned in papers late, because everyone was piecing together so many jobs to get by. “We learned the value of hard work,” the former senior class president says. He and many of his fellow alumni, schooled on thrift and “cash up front” habits, are a bit incredulous at our current state of affairs.
They’ve seen it before. “Speculation was the financial underside that propped up the overheated 1920s economy,” history Professor Ellen Eisenberg says. “People bought up swampland in Florida — not to live there — but to flip it. They bought worthless stocks on margin to sell to someone else. They bought, not because things had inherent value, but because they had value on paper. As long as prices continued to go up, everything was great, but at some point no one wanted to buy and the market imploded.
44% of Americans say they're focusing more on personal relationships, including family, children and marriage.
—U.S. News & World Report, March 2009
“The modern welfare system came about as a response to the Depression,” Eisenberg says. “A quarter of the workforce was unemployed, and the Roosevelt administration introduced Social Security, unemployment insurance and regulations that curbed the worst excesses of unfettered capitalism. Had WaMu gone under without the FDIC insurance created during the New Deal, it would have taken many of us with it.”
The worst of times were followed by the best of times, when the post-war boom jump-started the country’s economic engine. Real wages rose, creating a large and prosperous middle class. “That era was the golden age for contemporary capitalism,” history Professor Bill Smaldone says. “The post-Depression generation entered into a world of unprecedented wealth but retained Depression-era frugality, paying cash for purchases and saving for retirement, and workers had an unprecedented safety net, with rights to organize and receive unemployment insurance. That’s what gave the baby boom generation such incredible expectations.”
But the bubble began to leak in 1979, when real wage growth slowed, caused by higher food and energy prices, and stagflation — sluggish economic growth combined with high inflation and unemployment. Today, real median wages are still where they were a full generation ago even though productivity has tripled. “The cost of living has gone up substantially while wages have remained flat for most hourly workers,” Smaldone says. “So how do people maintain their standard of living? Spouses go to work and people live on credit, until the bubble bursts.” Nearly eight-in-ten respondents in a 2008 Pew Research Center survey said it was becoming more difficult for middle class people to maintain their standard of living, up from 65 percent in 1986.
Economics Professor Jim Hanson asked his students to share anonymous information about how their own families have been affected by the downturn. Some parents have lost jobs, retirees are returning to work, and everyone has seen investments plummet. “This downturn is giving students a taste of the caution their parents knew,” Hanson says. Now they’re taking a long pause before they buy a car, run up credit or even eat out.
WHEN LESS IS THE ONLY POSSIBLE ‘MORE’
With the current economic downturn, decades of expectations are running headlong into a wall. What happens when economies based on growth begin to shrink? “Massive consumption is the lifeblood of our economy,” history Professor Seth Cotlar says. “This is the trap we’ve gotten ourselves into. If there is a massive scaling back, we’ll have to completely restructure our economy.”
We may have no choice, economics Professor Jerry Gray says. “We’ve created a real bind, where we’re using up resources in a way the planet can’t sustain, and yet we’re doing everything we can to facilitate productivity and consumption. We would like to grow our way out of every problem, to make the pie bigger so people at the bottom can have a slice, but my worry is for the planet. This path is not sustainable.”
“We would like to grow our way out of every problem, to make the pie bigger so people at the bottom can have a slice, but my worry is for the planet. This path is not sustainable.”
—Jerry Gray, professor of economics
Maybe — just maybe — our economic engine could run as effectively in a lower gear. Maybe the social norming toward buying things we don’t need and eating more than we’re hungry for could be rethought. These changes would amount to reimagining an American dream that incorporates a more holistic economic model and a realistic assessment of finite natural resources.
But perhaps we’re not that far from a turning point. Northwestern Mutual recently surveyed Americans to fi nd out how we defi ne success. At the top of the list? Quality time with families, a good relationship with a spouse or partner, health, and a balance between work and life. Although three out of four said fi nancial security was important, “owning the home of your dreams” and earning a high income were ranked near the bottom.
“Unfortunately, an obscene amount of advertising dollars and brainpower go into making us believe that purchases are what give life meaning and make us happy,” Gray says, “but much of what we do is driven by very different motives than acquiring things. Most of us, in our daily lives, are motivated by deeper human needs — personal relationships, a sense of responsibility toward others and a sense of the kind of person we want to be.”
“It’s too early to speculate on whether, and how, the current crisis will change us as Americans,” Cotlar says. “Our prosperity is central to who we are, but we’ve never had to reckon with the costs. The very attributes we pride ourselves on — our industry and abundance — are the things that will lead to our destruction, and this has tainted our ability to enjoy our products. If anything positive could come out of this recession, it could be a push toward sustainability. We could all learn how to live happily with less.”
We could also relearn some of the skills we’ve lost, Cotlar says. “For example, entertainment could be refashioned as something we make rather than something we buy, and groceries could come from our backyards. If the cost of gas increases again, there will be an opportunity to reimagine the cities of the future and an incentive to reinvest in shared public transportation. People can respond creatively and become more self suffi cient, and that would be a good thing.”
The downturn provides an opportunity to abandon politics-as-usual and be more strategic in our decision making. “What’s happening now in Washington is some of the most exciting stuff I’ve seen in the past 25 years,” said Robert F. Kennedy Jr., who spoke to the Willamette community in March. “There’s an understanding that the path out of the recession is a new green energy future. We don’t need to choose between a healthy economy and a healthy environment — that’s a false choice.”
“We don't need to choose between a healthy economy and a healthy environment — That's a false choice.”
—Robert F. Kennedy Jr.
The crisis also presents an economic incentive for investment in infrastructure, Eisenberg says. “Our infrastructure has not kept pace with population growth. For example, in Salem we have two bridges that serve a population that has quadrupled.”
And the growing lines of the unemployed may nudge us toward a more compassionate response for others. “People are responsible for their own behavior,” Smaldone says, “but we’re also responsible for each other. Some argue that ‘those’ people deserve to be sleeping under the bridge, but many accept the tenet that ‘I am my brother’s — and sister’s — keeper.’ It doesn’t mean we support irresponsible behavior, but we need to look at the whole system. We need a system that protects its participants.”
DEPRESSION-ERA STUDENTS LOOK BACK
“Tuition was only $75 back during the Depression,” Oscar Specht ’39 says. “The only problem was, nobody had $75.” Specht lived on the third floor of the Willamette music building with eight other students. They showered in the gym and shaved in the library. “Students lived everywhere they could find a roof over their head,” Specht says.
“The uncertainty about the future created despair. I don’t want anybody to ever have to live through the kind of hardship we did, but there were some good things that came from the experience. We learned to do things for ourselves and we all helped each other. Families grew closer and formed a solid base.”
“We wore hand-me down clothes, but so many of us were in the same boat we felt equal,” Charlotte Theummel ’37 says. “Society was more level,” Mary Downey ’41 agrees. “I don’t think there was as much distinction between those who had money and those who didn’t. And people paid cash and knew how to stretch their dollars.
Now they make a big deal out of gardens, but then you either had a garden or you didn’t eat.”
The era was less about introspection and more about getting by, any way you could. “We didn’t really think about whether we were happy or not,” Downey says.
“It was so hard, working so much and having so little,” says Rosalie Ranton ’39, who had to drop out after she came down with pneumonia and ran out of money. But she carries an appreciation for her college experience. “Willamette changed my life,” she says. “I came out of my shell, and I was accepted as myself.
“I think in old age we become more of what we’ve always been, and I think what we learned back then was gratitude.”
“Since 1950 alone, the world's people have consumed more goods and services than the combined total of all humans who ever walked the planet before us.”
1932 OAKLAND CALIFORNIA | English style home 5 big rooms every modern feature garage lawn shrubbery | $3,650
FINDING THE BALANCE BETWEEN PROFIT AND PEOPLE
American-style capitalism developed against the backdrop of our seemingly endless frontier, where anyone with enough pluck could have “more,” and the “more” would never run out. Europe’s long history of feudalism shaped economies more regulated by social contracts and reciprocity, but “in America individual initiative and freedom — in the sense of being left alone — were more important,” according to politics Professor Greg Felker. People have argued ever since about the size of our safety net and the extent of our regulations.
“People on the right were frightened by the New Deal’s increase in the size of government and began working to undermine it, starting in the 1950s,” Felker says. “They said, and still say, that the welfare state is a slippery slope toward socialism, but actually America’s modest version of a welfare state was created in the 1930s as a buffer against social unrest. The free market gives rise to a churning of society, and regulations and social insurance act as a seat belt so you can continue to drive the capitalist car.”
We drove that car a long time. “For 50 years after the Depression we had a stable form of capitalism, because it was regulated capitalism,” said Nobel Prize winner and New York Times columnist Paul Krugman, who visited Willamette in January.
But regulation is needed in more areas than just subprime lending and derivatives, says economics Professor Jim Hanson. He agrees with Adam Smith, widely cited as the father of modern economics, that what individuals do for themselves often serves the public interest, but he believes we need governmental policies that will alter our behavior with respect to issues like the environment. “The market alone, without government, won’t get the job done,” Hanson says, “but government should harness the power of the marketplace to achieve environmental goals. The cap and trade system proposed by President Obama would be more effi cient than governmental mandates. If the government sells marketable permits rather than subsidizing cleanenergy alternatives, this will reduce rather than increase the budget defi cit and will create powerful incentives for the market to search for the most effective and efficient energy solutions.”
TAKE A STEP AND BREATHE
By Karen Wood, Associate Chaplain
We often redefine success when we face crisis. We come to understand that the world isn’t the way we thought it was.
Making a living is important, but making a life is more important. Our education prepares students to achieve financial success, but it also hopefully prepares them for lives of meaning and purpose. It helps them define success in a more thoughtful manner.
It’s too soon to tell if new values are emerging, but I have some optimism. The economic crisis calls to us to bring our best selves to the task of being a citizen. I feel like that’s the challenge; it’s a hopeful way to be in the world. There’s every expectation that we’ll come through this stronger and with more realistic expectations. What we experience as hardship in this country is considered extraordinary privilege in other parts of the world. Many are suffering anxiety over lost homes, jobs and dreams, but the most diffi cult times in the northern hemisphere don’t approach the perennial suffering in the southern hemisphere.
I think we are going to be tested, but I’m confident that if we’re resourceful enough, educated enough, and aware enough of our interconnectedness, we can get through this. I hope it will strengthen our personal and global ties. As the economic crisis permeates our lives, I hope we will become more dependent on one another. It’s hard to ask for help. We’re not good at it, as a nation or on a personal level. We like to go it alone. But people want to care for us. It allows them to practice generosity. I hope we reach out with less shame, with more willingness to ask for help, with the compassion to offer help.
In some ways, if we look at the overall societal need, it feels overwhelming. Or when we look at our own fi nancial situation, it may feel overwhelming. But we need to move through this the same way we move through the world. We take a step and breathe, and then take another step — and breathe.
CRISIS CREATES OPPORTUNITY
The Depression left some positive legacies, and the current recession bequeaths us with another set of opportunities. Crisis helps us define ourselves; it can transform us for the worse or for the better, or simply reinforce who we really are. Hardship serves as a flare that throws reality into sharp relief and forces us to reflect on our values. We realize there are ramifications for our individual and collective decisions, and as we understand our limitations, we reflect on what’s important.
Many of us are already making more creative business decisions. We’re talking about ethical bailouts to match our financial bailouts, and we’re revisiting the checks and balances associated with American capitalism. We’re inventing effi ciencies, stretching a buck, and becoming more conscious of energy use, and it suddenly seems like a good idea to cook dinner at home or recycle on Craigslist. “Economic hard times reinforce sustainable behaviors,” says Associate Chaplain Karen Wood.
There’s fresh motivation for deepening our connections with family and friends, for sitting on our front porches together. “When adversity creates community, the results are extraordinary,” Wood says. “I walk out on the Quad and see Waller Hall, and that dip in the lawn, and I remember the students and professors who put those bricks together with their hands. In our day it’s students tutoring in the community, feeding the homeless, shaping a better world with their hands and hearts.”
Will we redefine the American dream? Will we re-envision how we chart a meaningful or happy life? “Many social pressures still point in the same direction,” Smaldone says. “We still measure success by how much property we own and how many widgets we can pile up, but the economic crisis has dealt a severe blow to radical individualism. Perhaps it’s now possible for people to move forward with greater intention toward social justice. You can see how countries are talking together to manage the challenge; two years ago that would have been impossible. If that dialogue can be extended into talk about the environment, global disparities and the split between the northern and southern hemispheres, that would be good. You can’t disentangle the environmental crisis from the economic crisis, or from global poverty. My hope is that we can work together to solve some of our domestic and international problems in ways we have been unable to do in decades.”
The hope of the Willamette students who were on campus during the Depression was for a better life, and perhaps no students worked harder to get an education. Gus Moore ’34 says one of the high points of his life was walking forward to get his diploma. “I marched in procession with folks who had earned their degrees by working hard,” he says. “I was thinking, ‘I’ve got an education and I’ve got a job. Life can’t do anything but get better.’”
“Hope,” Kennedy told Willamette students 75 years later, “is a choice. Gratitude is a choice.”
“This country of ours has more wealth than any nation, but that's not what makes us rich. … What is unique about America is that we want these dreams for more than ourselves — we want them for each other. When our fellow Americans are denied the American dream, our own dreams are diminished.”
—President Barack Obama