What Made the American Dream so Important

The reason the American Dream was important, and why its loss is potentially catastrophic, is because it made possible modern life — as the engine that built the modern world.

It accomplished this by doing something new.  Something never seen before, across recorded history.

It was the simple premise that anyone, through hard work and fair dealings, could attain independent economic prosperity.   But it wasn’t only an idea.  It was a specific formula for living a good and productive life.

A simple formula more radical than democracy, capitalism, and communism ever were, even at their peak in popularity.

While it began as a religiously inspired moral imperative, over time it became a secular categorical imperative.  A concept so viral, it eventually spread throughout the world, far beyond the borders of America.  It is now present, at least at some level, within every population on earth.   In nearly every economic nook and cranny of the global landscape that has been touched by the global economy.

Yet, it was an idea so radical at the time, that it was only able to find truly fertile soil in America.  A place comparatively free of the shackles of Feudalistic nepotism, growing government bureaucracies, and Florentine finance that had so slowed its spread in Europe and elsewhere.

NOTE:  I’m not claiming that the US, now or historically, is categorically good.  It never has been, nor is it today (I’m a vocal critic of many of things we do wrong).  However, that is to be expected.  Every country in the world is rife with flaws and terrible historical mistakes, but it is my belief that on balance, the good the US has done, far outweighs the bad.  This is an example of that.

Why is it so powerful?

The reason the American Dream was so powerful is because it did something unique.

It made possible an economy that, for the first time in history, became more than just an exchange of lightly improved natural resources or a poorly maintained support network for incessant aristocratic warfare.

It instantiated a system of unrelenting technological improvement.  Technological improvement that turned a world that was largely unchanged since antiquity, into the modern world we see today within three centuries.

It did this by providing everyone with a reason for innovating technologically, and a reason for using those technological innovations.

It did this by motivating millions of individuals pursuing the Dream, to use technology to solve the myriad of problems we confront in everyday life.   It turned our economy into an engine of technological innovation.

In contrast, up until this point in history, technological progress was narrow, slow, and haphazard.  Worse, progress was often reversed by those in power.

For example, an innovation engine like this was obviously not possible in the parts of the world ruled by capricious aristocracies.

In those regions, the sustainable agrarian economy was sacrosanct and technological progress was routinely reversed on a whim (or to maintain social stasis as we saw in China on numerous occasions).

Innovation like this was also, a surprise to many, not possible in the economies dominated by Florentine banking and Venetian merchant adventures.

That ancient form of economics was based on a narrow base of commercial trade and financial rents.  A zero sum economy where only a small number — the strongest and shrewdest — profited.

As a result, technological progress often stagnated, and even when innovation occurred, these innovations were only lightly applied (aka went nowhere).  The reason is simple.  In a social system where few benefit, few have the means to tinker with technological innovations and even fewer are able to purchase them.

In contrast, the American Dream drove widespread technological innovation and the entrepreneurial drive to bring it to market.

The widespread prosperity made possible by the Dream, naturally drove forward demand for innovative technologies.  Technologies to help people become more prosperous, often by relieving the drudgery of everyday life.   This demand made it possible to deploy these technologies widely and provided the economic feedback loop that drove more innovation.



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Discussion — 21 Responses

  • Cavolonero February 13, 2014 on 3:41 pm

    Maybe this is really why this ‘ Maker ‘ thing is so important. Every American was supposed to be craftsman ( American craftsmanship ) and know how to do things ( Yankee ‘ know how ‘ ) ?

    • John Robb Cavolonero February 14, 2014 on 10:54 am

      Independent economic prosperity in a networked economy can be accomplished in a variety of ways. That’s one.

  • GoatGuy February 13, 2014 on 5:47 pm

    Watch “Inequality-for-All” by Robert Reich. I just did. Amazing film. Unflinching, disturbing, depressing (if you listen really carefully, and not get caught up with his positivism at the end).

    I find no way – after watching the movie, and after spending a lifetime coming to grips with the State of the Economy, and all that has passed – I find no way of not concluding that we’re headed for a special kind of socio-economic breakdown, of a new type, which history can be no guide. And that its not just an “American thing”.

    IN A NUTSHELL, Reich poses the statistics and idea that the largest sector of the GDP, the middle-class earners and purchasers, the middle-class producers and workers, managers and home owners have substantially been harmed by the economic policies bought-and-paid by the wealthy, legislated by the government in both their favor, and in net against the middle class itself.

    I urge that you rent the movie, or find a copy. Or if playing somewhere, see it. Perhaps the most important socioeconomic treatise I’ve seen in the last 20 years.


    • John Robb GoatGuy February 14, 2014 on 10:56 am


      It goes deeper than merely a misdirection of resources. It’s a complete shift. The end of a system as inevitable and potentially dramatic as the end of feudal agrarianism.


    • James Bowery GoatGuy February 15, 2014 on 3:15 am

      I watched Reich’s film. Superior to that is the online coming collapse of the middle class by Elizabeth Warren. Unfortunately both Warren and Reich were neutralized when they tried to cross the Rubicon of the Beltway.

  • James Bowery February 13, 2014 on 8:41 pm

    As a profound theoretic correction to the notion, promoted also by Ron Paul — that liberty is new — is the reality that in pre-Feudal northern Europe individual heads of households could challenge anyone, regardless of social status, to an informal duel in nature — a mutual hunt — represented by one of the oldest of their gods Ullr who was portrayed on skiis and with a bow and arrow as though in a winter hunt that quite likely represents an individual engaged in one of these informal duels. This culture lasted several thousand years — at least from the dawn of agriculture until the imposition of kings, civilization and finally JudeoChristianity. In that culture, accumulation of goods was almost entirely up to the single household and similarly limited since if anyone tried to form a gang, the leader of the gang would immediately be challenged by a threatened individual and very likely put to death.

    What this means is that “the Protestant work ethic” was most likely a reemergence of northern European instincts toward individual sovereignty — an instinct that found even greater expression in the New World until, the duel being reduced to skills with pistols with very formal and unnatural rules, single combat was altogether outlawed.

    • John Robb James Bowery February 14, 2014 on 11:05 am

      True, there’s always been a drive to individual sovereignty. This formalizes it within the economic realm. JR

  • phish February 13, 2014 on 9:27 pm

    sorry John, but Walmart is already front-running your idea in their “We Used to Make Things” ad campaign.

    i understand your concept is an end-around the decaying corpse of industrialization, but point is made (however snarky) in order to caution one on the quick corporate co-option of pretty much anything innovative these days.

    this is why it might be best to always keep one step ahead of the curve. as C.A. Fitts noted recently, “Movement is Life.”

    p.s. did you see the Flappy Bird developer took the app offline?

    • John Robb phish February 14, 2014 on 11:00 am

      Lots of work arounds possible. Saw that he did take it offline. His real reason was that the spotlight was screwing up his quiet life. As is the case with most creatives, he wasn’t in it for the fame/riches. He had a moral structure that focused him on getting just enough to keep creating.

  • Dan Lynch February 14, 2014 on 7:07 am

    My tactic with my 10 year old daughter is to teach her my trade. She will either pursue the same trade, or pivot off of it into something else. It’s a good bet that relaying to her my professional skills and wisdom as she comes of age will be far more valuable—at infinitely less expense—than college.

    If she wants to pursue college, that’s fine too, as an adjunct to what I’ve taught her.

    This idea is “back to the old way”, when in agrarian times, there was essentially the family business. Professional education amounted to apprenticing within the family business. It sets a course, and a direction.

    It doesn’t have to mean my daughter winds up doing what I do; but she will be far better equipped when she’s an adult to navigate the rough waters of whatever careers she pursues.

    • John Robb Dan Lynch February 14, 2014 on 11:03 am


      It’s still this way in places like Germany (where there are over 300 trades you can apprentice in). A generic degree? It does only two things for you: a) it punches a requirement on a resume and b) it has the potential (usually not exploited) to open your mind a bit.


  • Alex C February 14, 2014 on 4:40 pm


    Is there a chance that a political restructuring of the country (i.e. breaking up into more aligned regions vs. current “mega-state”) would restart this? I could see regions that valued low-regulations/business inhibition competing more successfully against high-regulation/taxation states, for example. The frontier that underpinned the American Dream is gone, but perhaps new frontiers emerge internally?

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