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Dream Hoarders Summary

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Dream Hoarders PDF

How the American Upper Middle Class Is Leaving Everyone Else in the Dust, Why That Is a Problem, and What to Do About It

The American Dream is alive and well; unfortunately, not for everyone.

And the upper middle class is to blame for that. Because, as far as Richard V. Reeves is concerned, they are Dream Hoarders.

Read ahead to find out what he means by that.

Who Should Read “Dream Hoarders”? And Why?

Dream Hoarders is for everyone who thinks that the American Dream is dead and interested in finding the reasons which have contributed to this result; it’s, even more, a book for those who think the opposite.

But, above all, it’s a book about the upper middle class, the top 20% of America’s population which holds about 90% of the total American wealth; and which is raging against the top 1% while being reviled by the bottom 40%.

Yup, we’re talking about you. You are the problem. And you should read this book to find out why and what you should do about it.

About Richard V. Reeves

Richard V. Reeves

Richard V. Reeves is a British-born American scholar and writer, senior fellow in Economic Studies at the Brookings Institution in Washington DC.

After earning a BA from Oxford University and a Ph.D. from Warwick University, Reeves became principal policy advisor to the Minister for Welfare Reform, and, subsequently, director of strategy to the UK’s Deputy Prime Minister.

A regular contributor to several journals (Guardian, Observer, The New York Times), Reeves moved to the United States in 2012 and became a US citizen in 2016.

In addition to Dream Hoarders, he has also authored a biography of John Stuart Mill.

Find out more at www.richardvreeves.com.

“Dream Hoarders PDF Summary”

According to a wide-ranging and pretty thorough study by the Economic Innovation Group, the American Dream is not dead – but only for about half of the American population blessed with the privilege of growing up in its more prosperous countries where vertical mobility is still a possibility.

Richard V. Reeves thinks he knows what’s the real problem: the upper middle class. And in Dream Hoarders – a book which grew out of his widely circulated New York Times article “Stop Pretending You’re Not Rich” – he explains why and how we should deal with it.

1    Hoarding the Dream

America lives in a pretty strange reality: its President, for one, is a former reality show star and looks as if he’s just gotten out of a cartoon; even stranger, he is a multibillionaire supported by blue-collar workers!

“At first glance,” writes Richard V. Reeves, “Trump’s success among middle-class whites might seem surprising, given his own wealth. But his movement was about class, not money. Trump exuded and validated blue-collar culture and was loved for it.”

Why, you ask?

Jonathan Haidt’s morality-based analysis aside, it is because – to the dismay of Liberal Democrats and Socialists – Trump’s supporters, as poor as they may be, have no problem with the fabulously rich.

On the contrary, in fact: they admire them excessively because they’ve become what they are despite the fact that they look like cartoon characters; they see the ultra-rich as the embodiment of their most intimate dreams.

“The enemy,” writes Reeves, “is the upper-middle-class professionals: journalists, scholars, technocrats, managers, bureaucrats, the people with letters after their names. You and me.”

“And here is the difficult part,” he goes on:

However messily it is expressed, much of the criticism of our class is true. We proclaim the ‘net’ benefits of free trade, technological advances, and immigration, safe in the knowledge that we will be among the beneficiaries. Equipped with high levels of human capital, we can flourish in a global economy. The cities we live in are zoned to protect our wealth but deter the unskilled from sharing in it. Professional licensing and an immigration policy tilted toward the low-skilled shield us from the intense market competition faced by those in nonprofessional occupations. We proclaim the benefits of free markets but are largely insulated from the risks they can pose. Small wonder other folks can get angry.

2    A Class Apart

The criticism against the top 1% of the population is so commonplace nowadays that there’s really no reason to go over the main points yet again.

But you know why is that?

Because it both comes from the direction – and communicates with – us: the 19% just below that top 1% of the population, i.e., the upper middle class, aka a large mass of people who are actually doing pretty well in life.

No wonder why the majority of the bottom 40% (the bottom 40%!) are not convinced!

Here’s a great example: according to Adam Levine, “more than a third of the demonstrators on the May Day ‘Occupy’ march in 2011 had annual earnings of more than $100,000.”

Now, don’t get Reeves wrong: he’s all about taxing the ultra-rich and limiting their potential to amass fabulous amounts of wealth at the expense of the poorest.

But, he’s also for extending the definition of what it means to be rich.

Because, according to stats, the upper middle class not only earns a lot more than the 80% of people below it, but it is also the one who reaps the benefits of progress:

Dream Hoarders Summary

Of course, more money means more freedom, better education and far better health: the top 20% smoke less, exercise more and live much longer than the rest of the population.

No wonder the rest feel like strangers in their own land.

3    Growing Gains

To say the least, “for those of us in the American upper middle class, life is pretty good.”

We enjoy the advantages well beyond our bank balances: “skills and education; control over our working life; the quality of our neighborhoods; ability to plan confidently for the future; our health, diet, and life spans; the stability of our families; and so on.”

However, there’s one privilege we enjoy that quite possibly tops each of the above because it is “the one most dangerous to the American ideal of equal opportunity.”

Namely, how we raise our kids.

“In the modern economy,” writes Reeves, “human capital has become vital for success. The most educated and affluent parents got the memo. Upper-middle-class families have become greenhouses for the cultivation of human capital. Children raised in them are on a different track than ordinary Americans, right from the very beginning.”

In other words, a typical child born and raised in the American upper middle class is privileged to live, on average, in a stable home and to be raised by married and well-educated parents.

In addition, this child is fortunate enough to live in a great neighborhood, which, as Steven Pinker has shown us, may contribute to about half of his skills and IQ.

Even more: this child is able to go to that area’s best schools which are far better than the schools located in bad neighborhoods; as a result, this child should eventually develop “a wide range of skills and gain an impressive array of credentials.”

4    Inheriting Class

OK, the upper middle class is privileged, you say, but that may be the bottom 80%’s fault.

After all, they live in the land of the free and the home of the brave; if he/she wants, anyone can move upward the social ladder in the US!

That’s not true, but let’s just say it is; contrary to many articles and studies, let’s just say that the US is egalitarian when it comes to opportunities, and that vertical mobility is a thing for just about every single citizen of the US.

The problem?

Even if that is the case, those who are up almost never come down. “Rather than a poverty trap,” writes Gary Solon, “there seems to be more stickiness at the other end: a ‘wealth trap’ if you will.”

In other words, there are many Horatio-Alger-like rags to riches stories floating around; but, how many riches-to-rags stories do you know?

The graphic below shows that the answer is probably “not that many”:

Dream Hoarders

Now, why is this important?

Because “it is a stubborn mathematical fact that, at any given time, the top fifth of the income distribution can accommodate only 20 percent of the population. Relative intergenerational mobility is necessarily a zero-sum game. For one person to move up the ladder, somebody else must move down.”

The problem, in other words, is not just class separation, but class perpetuation. And the solution is the wildly unpopular idea of downward mobility.

Say what you will, but that may be the very reason why you’re rich now.

Just ask Gregory Clark.

5    Market Merit

“America,” writes Reeves in the very first sentence of this chapter, “has a meritocratic market but an unfair society.”

In other words, the market works the way it should work, rewarding those who are better skilled and have competitive advantages over the rest.

The problem is – as the previous two chapters have already implied – that some have competitive advantages from the very outset.

That’s why the main challenge that lies before America is narrowing the gaps in human capital formation in the first two decades of life.

Put quite simply, an upper-middle-class child is bound to have better education and more capital to start with – not to mention facing less judgment and discrimination – when the actual market race starts.

So, we have meritocracy with no mobility which means that the market rewards fairly the ones who have an unfair advantage.

“The playing field may be level,” sums up the argument Chris Haynes in Twilight of the Elites, “but certain kids get to spend nights and weekends practicing in advance of the competition… the pyramid of merit has come to mirror the pyramid of wealth and cultural capital.”

Want to put an end to that?

Read ahead!

6    Opportunity Hoarding

The upper-middle-class children are not ahead when the market race starts merely because of their unfair advantages gained through inheritance; they are also ahead because their parents have hoarded opportunities, practically stealing them from the rest.

Three opportunity hoarding mechanisms stand out in particular:

• exclusionary zoning in residential areas;
• unfair mechanisms influencing college admissions, including legacy preferences;
• the informal allocation of internships.

In other words, the game is rigged in favor of the ones who are in a position to rig it:

Opportunity hoarding is bad for society in the same way that commercial market rigging is bad for the economy. It is good that parents want the best for their kids, just as it is good that company directors want to make profits. But companies should make their profits by competing fairly in the marketplace. That’s why we stop them from forming cartels. In just the same way, we need to stop parents from rigging the market to benefit their own kids. Right now, the markets that shape opportunity, especially in housing and education, are rigged in our favor.

7    Sharing the Dream

“I don’t intend to set out a comprehensive, detailed manifesto,” writes Reeves in the introduction to the seventh chapter of Dream Hoarders. “Instead, I propose seven steps that we can and should take.”

Here they are:

#1. Reduce unintended pregnancies through better contraception;
#2. Increase home visiting to improve parenting;
#3. Get better teachers for unlucky kids;
#4. Fund college fairly;
#5. Curb exclusionary zoning;
#6. End legacy admissions;
#7. Open up internships.

As you can see, the objective of the first four of these seven steps is to make the preparation for the market contest more even; the goal of the other three is to reduce anticompetitive behaviors.

The aim of all of them: to make life a little bit fairer.

8    Check Our Privilege

In the final, concluding chapter of Dream Hoarders, Reeves explains that the reason why he got his American passport was fairly simple: “the nation’s spirit of openness and promise of social equality.”

“I always hated the snobbery and class distinctions of the United Kingdom,” he goes on. “But the harder I have looked at my new homeland, the more convinced I have become that the American class system is hardening, especially at the top. It has, if anything, become more rigid than in the United Kingdom. The main difference now is that Americans refuse to admit it.”

It’s time that we do.

Highlight on the “we” if you’re an upper-middle-class kid.

Key Lessons from “Dream Hoarders”

1.      America Has Become a Class-Based Society
2.      The Upper Middle-Class Rigs the Market and Hoards Opportunities
3.      Seven Ways to Share the American Dream – If You Earn More than $100,000 a Year

America Has Become a Class-Based Society

America has always prided itself in the fact that it is a free society of individuals. To be American, writes Reeves, is “to be free to make something of yourself.”

However, in modern societies freedom is very tightly linked with money; and about 50% of American money is hoarded by the wealthiest 1% of the population.

It gets even worse: 90% of the total wealth is held by one-fifth of Americans.

Reeves’ book is directed at the 19% who refuse to admit that they are rich and privileged – and, that way, make life unbearable for the 80% that remains.

The Upper Middle-Class Rigs the Market and Hoards Opportunities

So, in a way, America has become exactly what Marxists have always blamed it on being: a class-based society.

However, as Trump’s victory at the 2016 election demonstrated, “the real class divide is not between the upper class and the upper middle class: it is between the upper middle class and everyone else.”


Because the upper-middle-class children live healthier and longer, and in better families and affluent neighborhoods, and are privileged to go to better and more success-prone schools.

What’s worse, their parents – say, through exclusionary zoning in residential areas and legacy college admissions – make a place there only for other parents such as them, thereby hoarding opportunities from the rest.

Seven Ways to Share the American Dream – If You Earn More than $100,000 a Year

If you are a member of the upper-middle-class and you’re reading this, then Reeves’ letter is for you:

Dear upper middle-class reader (if that is indeed you),
I’ve been putting this moment off for a few chapters.
If you really want a fairer and more socially mobile society, there is no avoiding an uncomfortable, attendant fact. More of our own kids will have to be downwardly mobile. This is not a moral claim but a simple mathematical fact. The top fifth of the income distribution can accommodate only 20 percent of the population. So, if we want more people climbing up the ladder into this top quintile, we need more to be sliding down the chutes.

And there are seven ways we can do this:

#1. Reduce unintended pregnancies through better contraception;
#2. Increase home visiting to improve parenting;
#3. Get better teachers for unlucky kids;
#4. Fund college fairly;
#5. Curb exclusionary zoning;
#6. End legacy admissions;
#7. Open up internships.

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“Dream Hoarders Quotes”

We are failing to live up to American egalitarian standards, based on fair market competition. Click To Tweet The American ideal of a classless society is, to me, a deeply attractive one. It has been disheartening to learn that the class structure of my new homeland is, if anything, more rigid than the one I left behind and especially so at the… Click To Tweet Human capital development gaps begin in the womb. Click To Tweet We should want to get rid of policies that allow parents to give their children an unfair advantage and in the process restrict the opportunities of others. Click To Tweet Upper middle-class Americans are healthier as well as wealthier. Click To Tweet

Our Critical Review

Even though fairly short and easily digested, Dream Hoarders is both original and revelatory – something you rarely say about books dealing with politics and economics-related topics.

Named Book of the Year by The Economist, and a Political Book of the Year by The Observer, Dream Hoarders was also shortlisted for the Goddard Riverside Stephan Russo Book Prize for Social Justice.

It was because of this book that Reeves was included by Politico magazine in its list of the top 50 thinkers currently working in the U.S.And once you finish Dream Hoarders, you’ll realize why they are not wrong: it may be one of the best and most honest books on US class and social mobility published in the 21st century.

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