Has the American Dream become the Canadian Dream?
There's been discussion about the American Dream on WSO before, @FinDroid"'s post pretty much shows we're divided on whether the Dream still exists or not.
But now a study from the Federal Reserve Bank of St.Louis says more people are willing to seek this dream in Canada, Denmark or the U.K..
The study, authored by Raj Chetty, professor of economics at Stanford University, defined the concept as the ability for children born in the bottom fifth of income distribution to reach the top fifth. In the U.S. the likelihood of that is 7.5%, whereas in Canada children born in that group are twice as likely to rise to the top — at 13.5%. In the U.K. the likelihood of achieving that move from the bottom fifth to the top fifth is 9% and in Denmark it is 11.7%.Indeed, the rich do appear to be leaving the middle class behind. Most U.S. middle-income households (81%) had flat or falling income between 2004 and 2014, according to a U.S. Congressional Budget Office data analyzed by the McKinsey Global Institute, a global management company.
“Most people growing up in advanced economies since World War II have been able to assume they will be better off than their parents,” the report said. “Yet this overwhelmingly positive income trend has ended.
I'd like to see what Trump can do for the growth rate after one year. Fin mentioned economists expected a 2% growth rate compared to Trump's 3.8%. Sure, America has it's faults like 20% living below poverty line or a messed up healthcare system.. but it's a start.
But I'd venture to say that economic mobility nowadays in the U.S has been on a downward trend since the 60s. It's not a shock to me that Americans are toying around with the idea of going elsewhere to pursue the Dream.
Do we have any Brits, Swedes, or Canadians that can vouch for the situation there?
Canadian here so I can only speak on the Canadian economy.
One massive point to recognize is Canada is heavily reliant on natural resources. In the 2004-2014 (date range of this study) oil prices were at global highs.
Huge oil prices -> oil infrastructure expansion -> expansion increases demand for skilled/unskilled blue collared labour. Who filled these roles? Frequently, though not always, people from a lower socioeconomic class. Labourers were making $25+ an hour, offered double time and all the hours they could handle. It was a cash cow and incredible opportunity for anyone without advanced education, all you had to do was work in terrible conditions.
These opportunities are no longer available in Canada (oil prices) so I doubt this trend continues.
@PWM Hopeful" I've heard from Canadian relatives that Canada does offer you a better piece of mind but its almost next to impossible to truly make it as a successful small business owner and make serious strides in going up the income bracket VS the US where your quality of life may not be as great but its far easier to start a business and make an annual income in excess of six figures or more.
Any thoughts?
Those are some big generalities, very different to compare an entire country/business economy. Only way to really know is to own a business both in the US and Canada (I don't) but here are some generalities I've noticed so far:
-American spending culture is completely different (much more liberal on spending funds they don't have because credit is easier to access). Theoretically makes income escalation easier with higher spending. Population density and more diversified economy allows for this as well. -Piece of mind really depends on where you live in the country. Aside from that, the biggest difference is healthcare actually being affordable. Never have to worry about getting hurt/sick/shot/burglary in Canada. People in the US are armed like they're about to have a civil war tomorrow. I don't even trust people to drive intelligently, much less have a weapon that can end me if they get mad. Ie. What happens if I break my wrist while playing a sport or get hospitalized or anger a random civilian that's having a bad day? Hard to have peace of mind.
TLDR: Having a viable, in-demand product that has a healthy profit margin is hard. Finding a country you want to live in that can sustain it makes it doubly hard.
Nearly the exact same in Australia. I know a guy who was an accountant getting paid $60k (AUD) a year and he said fuck it and went to Western Australia and got a job mining Iron Ore for $120k a year for a few years. He is back in accounting now but I agree there are not many jobs like that in Australia now due to the decrease in Iron Ore demand.
Another story I heard was that big mining companies would create nice suburbs in the middle of no where for the workers and families. So they had a few sporting fields and payed some guy $100k a year to maintain these fields. Jobs like this come around once every 30 years imo
I heard anecdotally that even the people working at McDonald's in these locations were making $20 an hour.
It's the taxes in those other countries that are big turn off. the motivation to do well is bound to diminish when you know that half your earnings are spent on other people. i can understand a quarter - maybe even a third, but almost half? no thank you. the American dream is very much alive in America and those people leaving are looking at the world through a very narrow lens indeed.
the_gekko you're absolutely right however I for one would be OK with living in Norway in exchange for paying higher taxes since the lifestyle is better than the US (all subjective) but isn't the biggest difference that in Norway you have one dominant demographic and a government that actually spends money wisely and every citizen for the most part has a much higher quality of life?
In the US I can work my ass off and pay taxes but the value those taxes should bring is not realized. Instead I see people who mooch off the system and some % of these people who are basically kept alive from cradle to grave courtesy of taxes but who offer no net benefit to the betterment of America.
I venture to guess it ain't so in Norway where the high taxes can be justifiable since you do see a higher quality of life (e.g. Paid time off for both couples who have a child) for about a year).
I still feel you can succeed in America in a number of ways. The "easiest" way is to do well academically and apply to a top university and graduate with a top tier, high-paying job lined up.
The people who bitch and complain about the end of the American Dream are probably lazy assholes who failed at key points in their lives or live out in Bumfuck, Mississippi with a 3rd Grade education who live in squalor.
/rant
People don't even know what the American dream actually is, so I just ignore people when they talk about that.
From my personal experience, the benefit the Canadian system has in terms of economic mobility is one that allows equality of opportunity to occur in a broader sense. Every single child in Canada (except maybe the aboriginal community) has two assurances from birth: access to high quality public education, and access to health care. This equality of opportunity from the point of birth is what I believe drives the economic mobility. Many students in the top institutions in Canada for learning are those who's parents are immigrants and likely don't have any formal education training in Canada. This has been my experience and I think there's still great room for improvement, but I do support the level(ER) playing field we give our citizens.
Just want to make it clear: I have nothing against the US system, just something I support about the Canadian system and I think we have seen real progress because of it.
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