By Jeff Greene
Today, rather than being the world’s poster child for a fair and equitable economy, the U.S. — home of the American Dream — is one of the least equitable among Western nations.
It wasn’t always this way. I was fortunate to have been raised in the 1960s in a country that had opportunities for many to do better and do well. Growing up in a middle-class family, I started with absolutely nothing, and was able to live the American Dream to the fullest. Yet today, too few overcome the fundamental ways in which our current system rewards those with money and penalizes those who simply work hard.
This situation will only get worse as automation expands, and technology replaces more and more tasks. As a result, the American Dream is becoming the Disrupted Dream.
But why should business leaders care about the lack of upward mobility in America? As a successful businessman, I’ll give you three reasons why.
1. It’s good for business
As leaders of our businesses, it’s easy for us to ignore the consequences of the decisions we make that can create ripples in society. When we set impossibly high requirements for the candidates we interview, or we have unconscious gender bias in hiring, or we ignore the needs of our workers to receive a living wage in high-cost cities, we are encouraging conditions that can have real impacts on our economy.
We can make different decisions, yet still run profitable businesses. A growing cadre of leaders is demonstrating ways in which they can already make a difference. Quiktrip CEO Chet Cadieux pays employees a variety of bonuses, yet generates 50 percent more profit per square foot than his competitors. Paul Tudor Jones’ Just Capital is working toestablish new standards of corporate value beyond simple quarterly-driven metrics. Starbucks’ Howard Schultz has offered online degree programs to all of his employees without a four-year degree.
All of these decisions can be good for business, by raising the quality of our worker pool, increasing employee loyalty, and developing better reputations for our organizations.
2. A consumer-driven economy needs consumers
About 40 percent of our economy is directly driven by consumer spending. That’s not as much as the urban myth of 70 percent, which includes fuzzy elements like healthcare spending. But 40 percent is still a substantial portion, large enough to send our economy into a tailspin when it drops dramatically, as it obviously did during the Great Recession.
As the gap between “have-lots and have-nots” grows in America, there is simply less discretionary spending by those in the middle class.
3. You can give others the same opportunity that you had
Let’s face it, success in business is a combination of hard work, business smarts, and luck. Over time, however, we often tend to discount the third, to the point where we don’t credit our luck much. There are plenty of people who are smart and work hard who haven’t yet been successful, while some of us were lucky in some way that contributed dramatically to our success.
Maybe you were born into a family of means. Perhaps you grew up in a town with a broad range of opportunities. You could have gone to a college with a tremendous alumni network that helped to fuel your success. Or you might have made a big bet in your business that went especially well – but could have turned out especially badly.
If we admit it to ourselves, we’ll realize that all of those occurrences to some extent depend on luck. As former Arkansas football coach Barry Switzer is credited with saying, “Some people are born on third base, and go through life thinking they hit a triple.” Yet many Americans don’t have the same opportunities that we had, so they start off a lot farther back, no matter how smart they are, or how hard they work. We need to give them a leg up, so they aren’t hobbled by the circumstances that kept them from having the same kind of success that we’ve had.
When I talk to everyone from small business owners to titans of industry, I see a sea change in the way people are beginning to think about kickstarting the American Dream. Business leaders can make conscious decisions, today, that can have demonstrable effects on increasing upward mobility. Fixing the systemic imbalances in our economy isn’t some theoretical exercise, and the time to move toward a more inclusive economy is now.
In America, we need many leaders from business who will work together to develop a vision for our inclusive and resilient economy of the future. I believe that creating a more inclusive economy is the defining issue of our time, and that leaders like you can have a real impact. At the end of the day, it’s not just good for the economy: It’s good for business. Yours.
Image credit: Flickr/Miguel Virkkunen Carvalho
Jeff Greene is an entrepreneur, the philanthropist founder of The Greene Institute, and the host of Closing The Gap, a conference bringing together leading thinkers and thinking leaders to develop strategies for an inclusive economy. Learn more at closingthegap.co.