While money may certainly be part of a good life, the American dream isn’t just about dollars and cents. Thirty-two percent of our respondents pointed to “freedom” as their dream; 29 percent to “opportunity”; and 21 percent to the “pursuit of happiness.” A fat bank account can be a means to these ends, but only a small minority believe that money is a worthy end in itself.
2. Homeownership is the American dream.
In June, a New York Times-CBS News poll found that almost 90 percent of Americans think that homeownership is an important part of the American dream. But only 7 percent of Americans we surveyed ranked homeownership as their first or second definition of the American dream.Why the discrepancy? Owning real estate is important to some Americans, but not as important — or as financially rewarding — as we’re led to believe.
Federal support of homeownership greatly overvalues its meaning in American life. Through tax breaks and guarantees, the government boosted homeownership to its peak in 2004, when 69 percent of American households owned homes. Subsidies for homeownership, including the mortgage interest deduction, reached $230 billion in 2009, according to the Congressional Budget Office. Meanwhile, only $60 billion in tax breaks and spending programs aided renters.
The result of this real estate spending spree? According to the Federal Reserve, American real estate lost more than $6 trillion in value, or almost 30 percent, between 2006 and 2010. One in five American homeowners is underwater, owing more on a mortgage than what the home is worth.
Those who profit most from homeownership are far and away the largest source of political campaign contributions. Insurance companies, securities and investment firms, real estate interests, and commercial banks gave more than $100 million to federal candidates and parties in 2011, according to the Center for Responsive Politics. The National Association of Realtors alone gave more than $950,000 — more than Morgan Stanley, Citigroup or Ernst & Young.
Homeownership is more important to special interests than it is to most Americans, who, according to our research, care more about “a good job,” “the pursuit of happiness” and “freedom.”
3. The American dream is American.
The term “American dream” was coined in 1931 by James Truslow Adams in his history “The Epic of America.” In the midst of the Great Depression, Adams discovered the same counterintuitive optimism that we observe in today’s Great Recession, and he dubbed it “the American dream” — “that dream of a land in which life should be better and richer and fuller for every man, with opportunity for each according to his ability or achievement.”