“What better way to start the new year than by learning that the American dream still lives on?” asks Mercatus Center economist Veronique de Rugy.

The American Dream, of course, is of being able to better one's lot and move up in the world. President Obama recently opined that income mobility (i.e., the ability to make money and rise) has decreased. Taking her cue from a piece by the Brookings Institution’s Scott Winship, de Rugy says the data doesn’t bear out this conclusion.

The Winship piece is headlined “The President’s Suspect Statistics,” and it takes note of President Obama’s claims about upward mobility at the Osawatomie, Kansas venue where, as you recall, Obama tried to imitate TR. Here is what the president said:

We tell people — we tell our kids — that in this country, even if you’re born with nothing, work hard and you can get into the middle class. . . . 

And yet, over the last few decades, the rungs on the ladder of opportunity have grown farther and farther apart, and the middle class has shrunk. You know, a few years after World War II, a child who was born into poverty had a slightly better than 50-50 chance of becoming middle class as an adult.

By 1980, that chance had fallen to around 40 percent. And if the trend of rising inequality over the last few decades continues, it’s estimated that a child born today will only have a one-in-three chance of making it to the middle class — 33 percent.

But Winship–who is not running for re-election on the odd claim that society is going to hell in a handbasket–says that this president's statistics "rang false to me.”

Winship “suspected” that the administration had deliberately sought statistics that would promote the notion of diminished opportunity. Winship therefore delved into the statistics given in Kansas:

Further research revealed that the evidence behind the president’s mobility claim is irreparably flawed. His figures are based on a very sophisticated — but unreliable — back-of-the-envelope analysis that was intended to get around data limitations.

And this is far from being simply an academic question. In this case bad evidence discourages people struggling to escape poverty. It unnecessarily increases Americans’ anxiety levels and adds to the general sense of gloom that has sapped consumer confidence, thereby increasing the agonizing slowness of the recovery.

Although Winship thinks that upward mobility is more limited than it should be, the bulk of the data he found suggests that income mobility has increased or remained stable over the long run. Using statistics, Winship concluded:

In contrast to the president’s claim of declining mobility, I found that upward mobility from poverty to the middle class rose from 51 percent to 57 percent between the early-’60s cohorts and the early-’80s ones. Rather than assert that mobility has increased, I want to simply say — at this stage of my research (which is ongoing) — that it has not declined. If I include households that reported negative or no income, the rise in upward mobility I find is only from 51 percent to 53 percent, which is not a statistically meaningful increase. But the data provide absolutely no evidence that economic mobility declined, whereas the president said it had fallen by ten percentage points.  

I don’t care one iota about what I consider the bogus issue of income inequality (some of my brainy pals tell me I should). The concept seems to me to be built on envy and to have little to do with whether or not people are able to prosper.

But income mobility is different. It matters. The United States has always been a country where people can rise by hard work. It is reprehensible that the president is willing to throw about statistics that are not only suspect but which sap our confidence and thus delay recovery. 

What I also can’t understand is why President Obama wants to run against a status quo over which he presides.

President Al Gore, another great champion of the middle classes, tried the very same tactic.