'1r Rana Foroohor is thc assista'rt managing editor otTime; she also appears o'l MSNBCI NN eithAlex Wagnerund writestor th€ Daily Beasl Edrlier in her care€r, sh€ uar Newsw€ek's ilzputy editot lot intemo- trbnal Dusiress and economics dnd uotefoT Forbes. She also spent six years in London, where sheJocued on couercge of th6e topics in Europe dnd the Middle Edst, dn(l rcceived an auad jtotn rhe Genrdn Morshall Fund Jor this trars-Atlantic repofing. As a BamfiA uniteryrca, Fotc,har was an Er{lish noior. This selection app.arel in he Novemb€J 74, 2017, eaition of TifiE as pan of a s€i€s €ntitled 'ropportuni9 Nation," itsef the nalne oJ a nonpanisan coalition composed of som€ tuo hundred orgomzdtioru uith d Jocus on increasihg sociai rnobiiity in the United Staks. As you redd this s€ledion, note the t{rays thal Foroohar contextualiz?s the situation in uhich Arn?rico fnds itseu loith respect to its history ond rrith respe.t to oth€r countri.s around th€ urorld. What Ever Happened to Upward Mobility? RANA FOROOHAR m€rica! stor!', our Dationai n''thology, is built on the idea ofb€ing an opportunity society. From th€ taies ofHoratio Alger to the real liv€s of Henry lord and Mark Zuckerberg, w€ have defined our country as a place \vhere everyone, ifh€ or she 1\'orl$ hard enough, can get ahead. As Al€xis de . i ,..,t:. \r J\. t.ij)t:) l 902 CHAPITN 2/ HOWDOWE DEFINE'INEQUALITY" IN AMERICAN sOCIETY? opportunity in our societl Modern surveys.onff.nl vhat Tocqueville sensed back then; Americans care much more about being abie to move up the socioeco nomic ladd€r than rvhere we stand on it. We may be poor today, but as long as there's a chance that we can be rich tomorro\r, things are OK. But does America slill work like lhal? The suspi cion that the ansrver is no inspires noi only the Occupy Wall Stre€t (OWS) protests that have spread across the nation but also a movem€nt as seemingll dh,crgent as the Tea Parry While OWS may focus its anger on rapacious bankers and the Tea Party on spcndthrift politicians, both would probably agree that therel, a cabal ofentitled elites on Wall Street and in Washington who hav€ som€holv loaded th€ dic€ and made it impossible for average people to get ahead. The American Drern, like the r€st of our economy, has become bifurcated- Certainly the numbers support the idea that for most People, itt harder to get ahead than it's ever b€en in the postrvar era. Inequality ir the U.S., alrvays high compared wirh that in other developed countries, is risinS. The 1% decried by OWS tak€s home 2r% of the countryt income and accounls for 35% of its rvealth. t-t., Pet.. 24 it a tt w York Ciry kin hqana b..het .nd .ans iutt t2100o a ye.r To eve nonet the tiw with het par .nn. 56. it ,3tooo ih .Lbt lron .ollege loaht. o Jo:kim Eskil&.r for L,'. Tocquevilie argued more lhan 150 years a8o, it3 this dream that enables Ameri€ans to tolerate much social tnequality-this corning from a lrench aristocrat-in €xchange for whar \re per.

1. '1r Rana Foroohor is thc assista'rt managing editor otTime; she
also appears o'l MSNBCI NN eithAlex
Wagnerund writestor th€ Daily Beasl Edrlier in her care€r, sh€
uar Newsw€ek's ilzputy editot lot intemo-
trbnal Dusiress and economics dnd uotefoT Forbes. She also
spent six years in London, where sheJocued on
couercge of th6e topics in Europe dnd the Middle Edst, dn(l
rcceived an auad jtotn rhe Genrdn Morshall Fund
Jor this trars-Atlantic repofing. As a BamfiA uniteryrca,
Fotc,har was an Er{lish noior. This selection
app.arel in he Novemb€J 74, 2017, eaition of TifiE as pan of a
s€i€s €ntitled 'ropportuni9 Nation," itsef the
nalne oJ a nonpanisan coalition composed of som€ tuo hundred
orgomzdtioru uith d Jocus on increasihg sociai
rnobiiity in the United Staks. As you redd this s€ledion, note
the t{rays thal Foroohar contextualiz?s the situation
in uhich Arn?rico fnds itseu loith respect to its history ond rrith
respe.t to oth€r countri.s around th€ urorld.
What Ever Happened to Upward Mobility?
RANA FOROOHAR
m€rica! stor!', our Dationai n''thology, is built
on the idea ofb€ing an opportunity society.
From th€ taies ofHoratio Alger to the real
liv€s of Henry lord and Mark Zuckerberg, w€ have
defined our country as a place vhere everyone, ifh€ or
she 1'orl$ hard enough, can get ahead. As Al€xis de
.

2. i
,..,t:. r J. t.ij)t:) l
902 CHAPITN 2/ HOWDOWE DEFINE'INEQUALITY" IN
AMERICAN sOCIETY?
opportunity in our societl Modern surveys.onff.nl
vhat Tocqueville sensed back then; Americans care
much more about being abie to move up the socioeco
nomic ladd€r than rvhere we stand on it. We may be
poor today, but as long as there's a chance that we can
be rich tomorror, things are OK.
But does America slill work like lhal? The suspi
cion that the ansrver is no inspires noi only the
Occupy Wall Stre€t (OWS) protests that have spread
across the nation but also a movem€nt as seemingll
dh,crgent as the Tea Parry While OWS may focus its
anger on rapacious bankers and the Tea Party on
spcndthrift politicians, both would probably agree
that therel, a cabal ofentitled elites on Wall Street and
in Washington who hav€ som€holv loaded th€ dic€
and made it impossible for average people to get
ahead. The American Drern, like the r€st of our
economy, has become bifurcated-
Certainly the numbers support the idea that for
most People, itt harder to get ahead than it's ever b€en
in the postrvar era. Inequality ir the U.S., alrvays high
compared wirh that in other developed countries, is
risinS. The 1% decried by OWS tak€s home 2r% of the
countryt income and accounls for 35% of its rvealth.

3. t-t., Pet.. 24 it a tt w York Ciry kin hqana b..het .nd
.ans iutt t2100o a ye.r To eve nonet the tiw with het par
.nn. 56. it ,3tooo ih .Lbt lron .ollege loaht.
o Jo:kim Eskil&.r for L,'.
Tocquevilie argued more lhan 150 years a8o, it3 this
dream that enables Ameri€ans to tolerate much social
tnequality-this corning from a lrench aristocrat-in
€xchange for whar re perceive as great d),namism and
FOROOHAR/wh.t Ev.r Happehed to Upward Mobjlity? 903
Evan,22, Sophia, 50, and Br.nt Nagao,54
Se.ause hE *lna, Calif., lath isnt prcfitable, Btent wotks fat
the usDA Ev.n quit hit jab to w.tk the LrD, while Saphia .at*
fotAt nt ailing patents.
llages, yhich have stagnated in real lerms since lhe
lq70s.l-dvc Deer fdlling ror mLch oilhe pr$ )ear' in
part because ot Pervasively high unemplolment For
the first lime in 20 years, the Percentage ofthe popu-
lation employed in the U.S. is lorver than in the U.K,
Germany and the Netherlands. "We like 1o think of
America as the norking€st nation on earth. But thatt
no longer the casei' says Ron Hnskins, a co directot
alongwith IsabelSavhili, of the Brookingslnstituiion!
Center on Children and Families
Nor drc rve the $orld grealest opponunity 'oci
ety. The Pew Charitable Trusts' Economic Mobility
Project has found ihat if you $'ere born in 1970 in the
bolrom one-frfth olthe socioeconomic perlrum jn

4. rhe U.s., ).ou had only about 3 l7% chance of making
jt into the spper two'fifths. 'fhat's not good by inter'
national standards. A spaie of nerv rePorts from
groups such as Brookings, Pew and the Organization
for Econonic Co-operation and DeveloPment show
Maria,39, and Darr€n 9umner, 40
fhe New Atleans caLple were laid all fion detign and ar.hitFdue
johs in 2003. [email protected] w* vat scrcetor Eau until Mt a
landed z
j.b 6 . d6ig. dnettd in septenbet Datren E nil laoki^g
FeleciaOgbodo,3T,.nd he{daughterErmaline, 18
Fele.ia, frcn Ftesno, aalit., lost her jab as a rc<ial wa*et and is
hlihg fat banktuptcy. Ernatine, a rtudent at uc san': cru.
woifies aboline€dt q io suppo4 ber mon
904 cHApTER 27 How Do wE DEFTNE "lNEeualtTy" JN
AMERICaN soctFTy?
that irlt easier to ciimb the so€ioeconomic ladder in
many parts of Europe than it is in the U.S. tts hard to
imagine a bigg€r hit to the American Dream ihan
thatryouA have an easi€r time getting a leg up in many
parts of sclerctic, debt ridden, class-rive! old
Europe than you would in the U.S.A. "The simpl€
truthi' says Sawhill, "is that we have a beliefsystem
about ourselves that no long€r alig$ with the factsl'
The obvious question is, What happened? The

5. ansivers, like social mobility itseli are nuanced and
complex. You can argue about what kind ofmobility
really matters. Many conservatives, for example,
$ould be inclined to focus on absolute mobility,
{'hich means the extent to lvhich people are beter off
than their par€nis wele at the same ag€. That's a mea-
sure thar focuses monly on horv much economic
growth has oc.ur€d, and by that measure, the U.S.
does fine- Trvo'thirds of40-year-old Americans live
in households with larger incom€s, adjust€d for infla-
tion, than theirparents had at the same age (though
the gains are smaller rhan they were in the preious
generation).
But just as rv€ dont f€el grateful to have indoor
plumbing or nultjchannel digital cable relevision, we
donl necessarily feel grateful thanve earn more than
our parents did. Thatt beca!5e r{€ don't peg ourselves
to our parents; we peg ourselves to the Joneses.
Behavioral economics tells us that our sense of well-
being is tied not to th€ past but to how we ar€ doing
compar€d with our p€ers. Relative mobility matters. By
that standard, lve ar€n't doing very well at atl. Having
the right par€nts increases )our chances of€nding up
middle to upp€r middle class by a factor of rhree or
four. It! very different in many other counrries,
including Canada, Australia, the Nordic nations and,
to a lesser extent, G€rmany and France. While 42% of
Am€rican m€n ivith fathe$ in the botrom fifth ofihe
5 earning curve remain th€re, only a quarter ofDanes
and Swed€s and only 30% of Britons do.
Yet itb important to understand rhar when yoa
compare Europe and America. you are LomparinS

6. very different so.ieties. High-grorvth Nordi€ nations
with good social safety ners, lvhich have th€ gr€atest
leads in social mobility ov€r the U.S., are smatl
and homogeneous. On average, only about 796
oftheir populations are etlnjc minorities (who are
often poorer and thus less mobile rhan the overall
population), compared rvith 28% in the U.S. Even
bigger nations like cermany dont have to deai wfth
populations as socially and economically diverse as
Still, Europe does mor€ to encourag€ equaliry. That!
a kq, point becaus€ high inequality-meaning a large
gap b€$veell the rich€st and poorest in society-has a
strong correlaiion to lo$er lnobiliry As Sa$,hill puts ir,
"When the rungs on th€ ladder are farther apart, itt
harder to climb up theml' Indeed, in ord€r to under
stand rvhy so€ial rnobility jn the U.S. is falling, irt
tdl.tn. i)! .. , (
...,,ti,.:r.,:r nri
Lr .:['.i).
'.:- i.. i]
.i,,! i,r,| , r. . .
i
I
I
{
I
:
,
I

7. {
i
t
important to understand why inequality is rising, norv
reaching l€i'els not seen since the Gtded Age.
'I here are many redsons for rhe huge and growing
rveahh divide ir our country. The rise ofthe money cul-
tule and bank de(€gulation in the 1980s and '90s cer-
lainly contnbuled ro ir. As lhe fi nancial sector grev
'n
relation to th€ rest of the economy (it's norv at historic
highs ofabout 8%), a winner{ake'all econom} €merged.
Wall Stre€t was less about creating ne$,business€s-
entrepreneurship has stalled as iinan€e has becom€ a
biffer industry-but it did help sei a n€w pay band for
top talent. In the 1970s, corporate chiefs earn€d about
40 limes as much as lheir lowest-paid lvorker (stiil
clos€r lo th€ norm in many parls of Europe). Now they
earn more than 400 times as much.
The most recent blovs to economic equality, of io
course, have been th€ r€al €stal€ and (redil crises,
whi.h rviped out housing prices and thus erased the
largest chunk of middle-class wealth, while stocks,
ehere the rich hotd much of their money, have largely
recovered. It is telljng that in the state by-srat€
Opportunity Index rccently rel€ased by Oppo!tunity
Nalion. a coal'rion ofpfllale and publ'c

8. 'nnirulions
dedicated to increasing social mobility, many of the
lorvest'scoring states-including Nevada, Arizona
and llorida rvere rhose hardesr hir by lh€ houring
FOROOHAR /What Ever Happened to Upward Mobility? 905
crash and are plac€s rvh€re credit continues to be
But the caus€s of inequality and any resulaing
decrease in social mobilityare also very much about
trvo m€Satrends that have been r€shaping the global
economy since the 1970s: th€ effecrs of t€chnology
and the rhe of the em€rgin8 markets. Some 2 billion
people have join€d the global workfor€e slnc€ lhe
1970s. According to Goldman Sachs, the majority of
them ar€ middle class by global standards and can do
many ofthe jobs rha{ were once done b) American
norkers, ai loiv€r labor costs. Coldman estimat€s that
70 million join that group €v€ry year.
While theret no .lear formula for as€ribing th€
rjse jn inequality (via wage compression) and subse-
qu€nt loss ofmobility to the rise ofchina and India,
on€ k€y sludy stands o!t. Nobel laureate Michael
Spencei recent examination ofmajor U.S. rnulrina-
tionals for th€ Coun€il on Foieign Relations found
that since th€ I980s, companies that operat€d in the
iradable sector-meaning they made things or pro-
'i'ided s€rvi.es that could be traded bchveen nations-
have created virtually no net nervjobs. The study is
esp€cially illustrative of the hollowing out of th€
American manufacturinS secior in that period as
rniddle-rvage jobs moved abroad. The only major job

9. 905 C HAPTER 27 TIOWOOWE DEF'NE 'INEQUA!Iry" IN
AI,IERICAN sOCIEry?
creation we! in more geo$aphically protected catego,
dcs like retail and health c.re (anothcr rcason wages
ale shrinking, since many of the fartest-gowing jobs
in th€ U.S., like home health carc aiale atrd sales clcrk,
are low-paying).
That so many of thc job6 we now deate are low €nd
undcrscores a $owing dcbate orll technology and its
role in increasi$8 or d.creasiry opponunity. Man), of
the jobs that havc disappealed from the U.S. .conomy
have done so not only b.caus€ thcy wlr€ outsourc€d
but also be.ause they are now done by computers or
robots. Advocates of techDology-driv€n economic
glowth, like the McKinsey Global Institute, would
argue that the cr.ative destruction wrought by such
innolrations creatcs morc and bctter iob,s in th€ future;
microchlp rnaldnS.mploys just 0.6% ofthe U.S. work-
force, but chips makc aI sorts ofbusiness€s more €Ifr-
cient so they can develop new producls and s.rvices
Th€ probkm is that those iobs tend to be skewed
toward the very top (software engineer) or the bottom
($les clerk). The jobs io the middle have disaPPeared
According to the N.w America Foundation, a Public-
policy thinl tank the share of middle-income jobs in
the U.S. feu frorn 52% in 1980 to 42% in 2010.
While ther€'s no doubt that so far, technolo$r has
been a net plus in terms ofthe number ofiobs in our
economy, a growing grouP of €xperts believe that link
is bcing brok€n. Two cconomists at MIT, Erik

10. Bryniolfsson and Andrcrv McAfc€, havc iust pub-
lished an ir uential book litled Rac. against the
Md.fiire,looking at how computers are in€reasingly
able to perform task b€tter than humans do, from
driving (Google softwar. recendy took a s€lf-drivinS
Prius on a 1,000-mile trip) to sophisticated pattern
recoSnition to $'riting creati€ essays and composil
award-winning music. The result, they say, is th
technoloSy may soon be a net iob destroyer.
The b€st hope in fithtint rhe machines is r
improve education, the factor that is more clos€ly co
r€lated with upward mobility lhan any othcr Resear.
has shown that as long as educatioml achieveme:
keeps up with technologkal gains, more jobs are cr
at€d. But in th€ late 1970s, that link was broken in tl
U.S. as educatlonal gains slowed. Thatt likely a
important reason that Europears have pass€d the L'.:
in vadous measures ofmobility. Theyve been expos€
to the same Malthusian fg''es oJjdohalirafin+ Ju
they ve been better at using public money to buffe
tbem. By firnding postsecondary education .nd keep
ing public primaryand secondary schools as good a
if not better than privale ones, Europeans have mai
sure that the best and bnghtest can rise.
There ar€ many other lessoB to b€ lealn€d fro:
the most fiobile nations. Funding univ.rsal heali:
car€ without tying it to iobs €an incteasc labor fler]
bility and r€duce thc chance that pcople will fall inl
poverty because of medical em€rgencies-a commr'.
occurrence in the U.S., where such medical cris€s a.:
a big reasor a third ofthe population cycl€s in aiJ

11. out of pov€rty €v€ry tear. Focusing more on le.i
exp€nsive prevenlive cate (including fam ily Plannr r. j
since hiSh teen birtlrat€s €orrclale with lack of mo:
ity) rather than on expensive Procedures caJI incre;-
the gen.ral health levels in a societ, whi€h is also i. :
rclated to mobility.
Europ€s higher spen&ng on social3afcty n.ts i :
cctt.inly bolstcrcd th€ middle and workjnS clas.e.
(Indeed, you could argue that some ofAmerica's gI.::
social programs, in€luding Social Security and
Medicaid, enabl€d us to become a middle-class
nation.) Countries like Cermany and Denmark that
have inv€sted in youth-enployment proSrams and
technical schools where young people can learn a
high-prying trade have done weli, which is not sur-
prising given that in many studi€s, inciuding the
Opportuniry Nation inder, ther€ii a high correlation
betw€e[ the oumber of teenag€rs who are not in
school or not working and lowered mobility.
Of course, the debt crisis in Europe and the Fotests
ov€r austeriiy cuts in plac.s like Athens and London
make it €lear that the traditional Europ€an wellare sys-
tems are undergoing very profound chlnges that may
reduce mobility throughoul lhe coDdnent. But there is
still opportunE in €mciency. Cermans, for example,
made a command decision after the financial dowr-
turn in 2008 oot to let unemploym€nt rise because it
would ultimately b€ more expensive to put p€ople back
to work than to pay to keep lhem in th€ir iobs. The
government subsidiz€d companies to kcep workeN (as

12. many as I.4 milion in 2009) on the payroll, even part
time. On(e the economy began to pick up, companies
were ready to capitalize on it quickly Unemployment is
now 6%-lower than before the recession-and growth
has stay€d relativdy high.
The Nordic nations, too, hav€ figured out clever
ways to combine strong €conomi€ gronlh with a
decent amount of security. As in Germany, Iabor and
corporate relations are collaborative rather than con-
FOROOHAS/Wh6t lver H.ppened to Upward Mobility? 907
t€ntious. Union reps often sit on company boards,
which makes it easier to curb ex€essive ex€cutive pay
and negotiate compromises over working hours.
Worker retraining is a high prioritt. Danish adults
spend a lot of time in on-the-job training. That's one
reason they also enjoy high real $,ages and relatively
low unemployment.
The final lesson that might be learned is in txx 20
policy. The more-mobile European nations have
fewer coryorate loopholes, more redistribution to the
poor and middle class via consumption ta*es and far
less complication. Irancet tax cod€, for example, h
12% as long as the U.S.'s. Tax levels are also higher,
som€thing that lhe enliShlened rich in lhe U.S. are
very publicly advocatin&
No wonder. A larSe body of acad€mic research
shows that inequality and lack of social mobilitt hurt
not iust lhose at the bottod! they hurt everyone,
Unequal societies have lorver levcls oftrust, hi8her
levels of anxiety and more illness. They have aryuably
less stabl. economies: International Monetary Fund

13. research shows that countri€s like the U.s. and thc
U.K. are more prone to boom-and-bust cycles. And
they are ultimarcl), at risk for social instability.
That's the infl€ction point that w€ are at right
now. The m)'rhology ofthe American Dream has
made it difficult to start a serious conv€rsation
aboul how lo cr€ate more opportunity in our soci-
ety, since manyofus still believe that our mobilityis
the result of our €lbow greas€ and nothing more.
Module 3 Assignment 2
By Friday, November 22, 2014,
Required Assignment 1—Organizational Assessment
As a manager, you have to continually evaluate the organization
and its strategy and consistently adapt the business model to
ensure that the overall business plan is one step ahead of the
competition.
In this assignment, you will get an opportunity to learn, from
actual experiences, how an informed manager would assess the
current overall health of an organization and make decisions
regarding future opportunities and performance.
Tasks:
Select an industry relevant to your career. If you lack work
experience, you can base your selection on real-life market
situations or business areas that you may have knowledge about.
You can also consult sources such as the Wall Street Journal,
Financial Times, and Bloomberg Markets, the Economist, US
News and World Report resources.
· Research the growth opportunities in the industry, competitive
strategies that were employed, typical customers, and other
relevant information related to the industry. Specific
opportunities will differ depending on the industry selected, but
be sure to consider current economic events and news relating
to the industry that may influence the future direction of your

14. industry.
· Within this industry, select a midrange-performing company
that provides goods or services. Then, address the following:
· Analyze why this company maintains the level of success it
does from an economic and financial perspective. Develop at
least two visual aids (e.g., charts, graphs, or tables) to support
your argument.
· Evaluate whether the company's pricing and positioning
decisions contribute to or hinder that success.
· Evaluate whether the strategy currently used by your industry,
as discussed in previous sections, appears to be sustainable over
time.
Create a 4- to 5-page research paper. At the end your paper,
include a reference page and cite scholarly sources in APA
style.
Assignment 2 Grading Criteria
Maximum Points
The assignment showed in-depth research into the growth
opportunities in the industry, competitive strategies that were
employed, typical customers, and other relevant information
related to the industry.
16
Selected a midrange-performing company that provides goods
or services within the industry.
16
Analyzed why this company maintains the level of success it
does from an economic and financial perspective, and developed
two visual aids to support your argument.
68
Evaluated whether the company's pricing and positioning
decisions contribute to or hinder that success.
60
Wrote in a clear, concise, and organized manner; demonstrated
ethical scholarship in accurate representation and attribution of
sources; and displayed accurate spelling, grammar, and
punctuation.

15. 40
Total:
200