The American Dream Is Alive. But You May Need Capital to Enter.

There is something wonderfully American about declaring the American Dream alive because the country is producing more millionaires.

And, to be fair, there is something important in the argument.

The Wall Street Journal has just published a fascinating piece under the deliberately optimistic headline “The American Dream Is Alive. And It’s Minting Millionaires.”

https://www.wsj.com/business/entrepreneurship/the-american-dream-is-alive-and-its-minting-millionaires-3903775b

Its central point deserves attention because it challenges the increasingly fashionable idea that American wealth belongs exclusively to a tiny collection of Wall Street financiers, Silicon Valley founders and inherited fortunes.

America has an enormous universe of private business owners.

Many are not celebrities.

They own construction companies, medical practices, restaurants, logistics businesses, dealerships, professional firms, small manufacturers and thousands of other businesses that rarely appear on CNBC.

That matters.

But perhaps the WSJ is right for a reason that creates a much more uncomfortable question.

America may still be extraordinarily good at creating millionaires.

The question is increasingly:

Who gets to become one?

The American Dream Has Not Disappeared. It Has Changed Its Balance Sheet.

For much of the twentieth century, the American economic bargain was relatively easy to understand.

Work.

Earn more.

Buy a house.

Accumulate savings.

Build a pension.

Perhaps start a business.

Pass something to your children.

It was never universally accessible, and nostalgia often exaggerates how egalitarian that system really was.

But there was an important economic mechanism underneath it:

labour income could gradually be converted into ownership.

That distinction matters enormously.

Because wealth is not income.

Income pays your electricity bill.

Assets change your balance sheet.

And the modern American economy increasingly rewards the balance sheet.

Consider what the Federal Reserve finds.

In its latest Survey of Consumer Finances, covering 2022, 20% of American families owned a privately held business, the highest proportion recorded in the modern survey.

Among families in the top income decile, nearly half owned a business.

That is impressive evidence of entrepreneurial dynamism.

But look deeper.

Families without businesses had average net worth of roughly $570,000.

Families owning non-employer businesses had average non-business net worth approaching $1.1 million.

For families owning businesses employing more than five people, average net worth excluding the business itself exceeded $4 million.

The numbers are screaming something considerably more interesting than simply:

Entrepreneurship works.

They are telling us:

ownership works.

Two Americas Are Emerging

The traditional political argument divides America into rich and poor.

That distinction is becoming less useful.

I would divide the modern economy differently.

There is increasingly an Ownership America and a Labour America.

Ownership America owns some combination of:

equities, businesses, property, intellectual property, private-market assets, investment portfolios, retirement assets and increasingly digital assets.

Labour America primarily owns something else:

its future working hours.

Both groups participate in capitalism.

But they participate from opposite sides of the balance sheet.

One receives wages.

The other owns assets capable of appreciating while everyone sleeps.

And this distinction becomes extraordinarily important during periods of asset inflation.

The Employee Gets a Raise. The Owner Gets Compounding.

Suppose a worker receives a 4% salary increase.

Good news.

Now suppose someone owns $2 million in financial and business assets and those assets appreciate 10%.

That is $200,000.

The worker must negotiate again next year.

The capital does not.

Obviously markets fall, companies fail and property values decline. Capital ownership carries risk.

But over long periods, the distinction remains fundamental:

labour is compensated periodically; capital can compound continuously.

And once enough capital has accumulated, another advantage appears.

Access to credit.

Banks generally prefer lending against assets.

A homeowner can borrow against property.

An investor can obtain securities-backed credit.

A company owner can finance expansion against cash flows and assets.

Capital therefore does something fascinating.

It not only produces returns.

It can improve access to additional capital.

This is where inequality becomes less about consumption and increasingly about economic architecture.

Housing: The Original American Capital Machine

For millions of middle-class Americans, the home historically provided the bridge between Labour America and Ownership America.

A mortgage was effectively a forced savings mechanism.

Part of every payment gradually converted labour income into equity.

And rising property values did the rest.

That mechanism still exists.

But admission has become considerably more expensive.

The Federal Reserve reported that housing affordability had fallen dramatically as home values rose relative to family incomes; in the 2022 SCF, the median home was worth more than 4.6 times median family income.

The latest Fed household survey makes the divide even clearer.

In 2025, 86% of adults earning $100,000 or more owned their homes.

Among adults earning below $50,000?

33%.

That isn’t merely a housing statistic.

It is a capital-formation statistic.

Because when property prices rise, homeowners accumulate equity.

Renters accumulate receipts.

Then Comes the Stock Market

Something similar happens with equities.

The good news is important: stock ownership has broadened.

Between 2019 and 2022, participation increased across much of the income distribution.

That is precisely what we should want.

But participation and exposure are very different concepts.

Someone with $5,000 invested in an index fund and someone with $5 million invested in financial markets can both truthfully answer:

“Yes, I own stocks.”

Economically, however, they are living in different universes.

If markets rise 20%, the first gains $1,000.

The second gains $1 million.

Same percentage.

Very different capitalism.

This is one reason why financial markets increasingly influence social inequality even without anyone behaving maliciously.

The mechanism is almost embarrassingly simple:

asset inflation disproportionately benefits people who already own assets.

And Then We Invented Crypto

Crypto was supposed to disrupt this architecture.

That was part of its ideological appeal.

No Wall Street gatekeepers.

No banks.

No privileged financial intermediaries.

Anyone with a smartphone could participate.

There is truth in that.

But crypto has not abolished the distinction between capital and labour.

In many respects it has simply created another asset class in which capital can appreciate — sometimes spectacularly and sometimes catastrophically.

The Federal Reserve reported that in 2024 around 7% of American adults bought or held cryptocurrency as an investment, while actual transactional usage remained much smaller.

Even more interestingly, Fed data show that higher-income adults were more likely to hold crypto as an investment, while lower-income adults were relatively more likely to use it for transactions.

There is an almost perfect miniature of the broader economy hiding inside that statistic.

Those with more resources are more likely to use the technology as an asset.

Those with fewer resources are relatively more likely to use it as money.

Crypto promised democratized finance.

It may still deliver some of that.

But democratizing access to an asset is not the same as democratizing the amount of capital available to invest in it.

Now Add AI

And this is where the story becomes considerably more interesting.

The industrial revolution multiplied physical labour.

Computers multiplied calculation.

AI may multiply cognitive labour.

That could generate enormous productivity.

But productivity gains always raise another question:

Who owns the productivity machine?

If AI substantially increases corporate margins, the first beneficiaries are likely to include shareholders.

If AI enables one entrepreneur to operate a company that previously required twenty employees, the entrepreneur captures part of that productivity.

If AI reduces demand for particular categories of labour, some workers may simultaneously experience weaker bargaining power.

None of this makes AI undesirable.

Quite the opposite.

But it means the ownership question becomes even more important.

Imagine an economy in which intelligence itself increasingly becomes a form of capital.

Then the decisive economic distinction may no longer simply be:

skilled versus unskilled workers.

It may become:

people who own scalable intelligence versus people who sell individual intelligence by the hour.

That is potentially a much larger transformation.

This Is Not the Marxist Story

At this point someone will inevitably say:

“So this is simply Marx again: capital versus labour.”

Not quite.

Marx underestimated several things capitalism became exceptionally good at doing.

One was expanding ownership.

Pensions own equities.

Workers own retirement accounts.

Middle-class families own homes.

Employees receive stock compensation.

Millions of Americans own businesses.

Retail investors own shares directly.

Technology has reduced the cost of investing almost to zero.

This is precisely why the American model remains extraordinarily resilient.

The boundary between worker and capitalist is porous.

The same person can be both.

A teacher with a pension.

An engineer with company shares.

A plumber who owns his business.

A nurse with an index fund.

A restaurant employee buying Bitcoin.

A retiree living partly from investment income.

The interesting question is therefore not whether capitalism divides everyone neatly into workers and owners.

It doesn’t.

The question is:

How easy is it for someone whose principal asset is labour to acquire meaningful ownership?

That is the modern American Dream question.

Entrepreneurship Is Still America’s Strongest Counterargument

And this is where the WSJ article deserves real credit.

Private business formation remains one of America’s great economic strengths.

The Fed’s figures are remarkable: business ownership reached a record 20% of families in its 2022 survey.

Even more encouragingly, business ownership increased among families in the bottom half of the income distribution as well as among those at the top.

That matters enormously.

Because entrepreneurship remains one of the few mechanisms capable of turning labour into scalable capital relatively quickly.

A worker sells an hour.

An entrepreneur builds an organization capable of selling thousands of hours.

Eventually the business itself becomes an asset.

This explains why small-business wealth is so important to understanding America.

The millionaire next door may not be a hedge-fund manager.

He may own three plumbing companies.

She may own a dental practice.

They may operate a logistics business nobody outside their county has heard of.

That is genuine economic mobility.

And any serious analysis of American inequality that ignores this phenomenon becomes ideological rather than analytical.

But There Is Another Side to the Same Data

The Federal Reserve also finds an enormous difference between median and average business values.

In 2022, median business equity among owners was about $90,000.

Average business equity?

Approximately $1.62 million.

That enormous mean-median gap tells us that business wealth itself is highly skewed.

So even inside Entrepreneurship America there are several Americas.

There is the freelancer.

The family business.

The employer with five workers.

The regional company.

The private-equity-backed enterprise.

The unicorn.

Calling all of them “business owners” is statistically correct.

Economically, it can hide more than it reveals.

The Great Divide May No Longer Be Income

This leads to the central argument.

For decades, political debate has obsessed over income inequality.

Perhaps we are increasingly measuring the wrong thing.

Imagine two households earning exactly $120,000.

Household A owns:

a house with substantial equity,

$250,000 in retirement investments,

a stock portfolio,

and part of a small business.

Household B rents,

has little financial wealth,

and depends almost entirely on salary.

Their income is identical.

Their economic futures are not remotely identical.

One household participates meaningfully in asset appreciation.

The other participates primarily in wage growth.

Over twenty years the difference can become enormous.

So perhaps the defining inequality of twenty-first-century capitalism is increasingly not:

high income versus low income.

It is:

capital ownership versus capital dependence.

The Working Class Has Not Disappeared. Its Problem Has Changed.

The old industrial working class worried about wages.

The modern working class must increasingly worry about asset prices too.

Housing.

Education.

Healthcare.

Retirement.

Financial markets.

Even access to entrepreneurship.

When asset prices rise faster than wages, someone without assets does not merely become relatively poorer.

The entrance ticket into ownership becomes more expensive.

This creates a peculiar paradox.

A booming stock market is celebrated as evidence of economic prosperity.

Rising property values are celebrated as household wealth creation.

Private-company valuations rise.

Bitcoin rises.

But every appreciating asset simultaneously produces two effects:

it enriches existing owners,

and raises the price for future owners.

Every bull market has an entrance fee.

We rarely put that on the chart.

So Is the American Dream Dead?

No.

And this is where I partly agree with the Wall Street Journal.

Declaring the American Dream dead is intellectually lazy.

America continues to produce extraordinary businesses, entrepreneurs and fortunes.

Its capital markets remain extraordinarily deep.

Its culture remains unusually tolerant of business failure.

Its financial system can finance ideas at a scale few countries can reproduce.

Its technology ecosystem remains formidable.

And millions of ordinary business owners demonstrate that wealth creation is certainly not restricted to a handful of dynasties.

The American Dream is alive.

But its mechanics may be changing.

The twentieth-century version said:

work hard and you can build wealth.

The twenty-first-century version increasingly says:

work hard — and convert that work into ownership as early as possible.

That is a subtle difference.

It may ultimately be an enormous one.

The Real Policy Question

If policymakers genuinely worry about inequality, perhaps redistributing income after wealth has already been created is not the only question worth asking.

A more interesting question is:

How do we broaden ownership before the inequality appears?

Make housing accessible.

Encourage retirement investment.

Make employee equity participation easier.

Reduce unnecessary barriers to entrepreneurship.

Improve financial education.

Increase competition.

Make capital markets accessible without encouraging reckless speculation.

Allow ordinary households to participate in productivity growth rather than merely consuming its products.

Because there are two fundamentally different ways to reduce the divide between capital and labour.

One is to tax capital more heavily.

The other is to help more workers become capital owners.

Those approaches are not mutually exclusive.

But the second receives surprisingly little attention.

Capitalism’s Greatest Challenge May Be Capitalism’s Greatest Opportunity

The irony is almost perfect.

Capitalism may not be suffering because too many people are becoming capitalists.

It may be suffering because not enough people feel that they are.

A society in which millions own homes, businesses, equities and retirement assets has a very different relationship with markets from one in which a small minority owns productive capital while everyone else receives wages.

Broad ownership does more than distribute wealth.

It changes incentives.

It changes attitudes toward investment.

It changes political behaviour.

And perhaps most importantly, it changes the psychological relationship between citizens and economic growth.

People stop watching capitalism from the audience.

They own part of the theatre.

The American Dream 2.0

So perhaps the Wall Street Journal is right.

America really is minting millionaires.

Good.

We should celebrate that.

But the number of millionaires is not, by itself, a sufficient measure of economic mobility.

A country could theoretically produce millions of new millionaires while simultaneously making the first rung of the ownership ladder harder to reach.

Those two realities can coexist.

And that is precisely why the debate about inequality needs to move beyond the tired argument of rich versus poor.

The more interesting division is becoming:

those whose labour finances their lives

versus

those whose capital increasingly finances their lives.

The healthiest capitalist society would make that boundary as easy as possible to cross.

Because the American Dream was never fundamentally about becoming rich.

It was about something more powerful:

the belief that tomorrow’s economic position did not have to be the same as today’s.

That dream is not dead.

But perhaps the entrance requirements have changed.

Today, hard work still matters.

Education still matters.

Entrepreneurship still matters.

Risk still matters.

Luck has always mattered.

But increasingly, one additional variable determines how quickly the economic escalator moves:

ownership.

And that leads to the question I would place above almost every debate about wages, inequality, AI, crypto and financial markets over the coming decade:

What happens to capitalism when work still pays the bills, but ownership increasingly determines who becomes wealthy?

Perhaps America isn’t witnessing the death of the American Dream at all.

Perhaps it is witnessing its financialization.

And that may be a considerably more interesting story.

Roberto Balbino
CEO, Fintech SCB
Independent analyst of finance, economics, geopolitics and global markets.