Contrary to the popular consensus today, the American Dream was very real for most of America’s history. This was less due to American ideals and institutions, and more the fact that America (as a new country) had less time to accumulate a rentier class, which takes a couple generations for the fortunes to really multiply. And as a country with a very high population growth rate (remember the average colonial New England family had like 10 kids), any wealth that did get accumulated was quickly diluted over a bunch of children instead of inherited as a chunk. This was at least true in the North and frontier – the South, which inherited a lot of the worst parts of the 1600s English upper-class, got a society along the lines of the European aristocratic model with rentier plantation owners. Traditional models of labor-capital split generally fail to capture this because much Southern wealth was in the form of slaves, ie labor turned into a form of capital, which confuses the models. But as for the rest of the country, Piketty approvingly quotes Tocqueville’s description of America as “a land without capital”.

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