The Psychological Toll of the American Dream
Unpacking How the Pursuit of Success Fuels Anxiety and Disillusionment in Our Current Economy
As a clinical psychologist, I am privy to the profound ways society shapes our personal lives. As analysts and reporters have spent the past couple years examining the source of Americans' ongoing economic pessimism against the backdrop of a reportedly strong economy, I have heard – across the economic spectrum – people’s growing concern about the widening economic extremes emerging in our society. These extremes have been straining not only people’s finances but also their mental health, and it is no surprise that it played such a strong role in the elections.
Economic anxiety has been widespread in the United States. A 2024 study by the American Psychiatric Association found that 77% of adults were anxious about the economy, with 63% worried about paying bills. In 2023, an American Psychological Association study revealed the number of adults ages 18 to 44 that rated the economy as a significant stressor had increased over 38% since 2019.
These financial insecurities are of particular importance to psychologists, because they are known to adversely affect mental health. I have seen this in my clinical practice and it may be obvious: prioritizing well-being and affording mental health care become more challenging when we worry about comfortably meeting our financial obligations and maintaining economic stability for ourselves and our families.
As our nation strives to resolve ongoing mental health crises, understanding and addressing these economic insecurities is a crucial step toward meaningful progress.
To gain deeper insight into the elements of the economy contributing to the rise in economic anxiety and stress, I sat down with one of the nation’s leading economists, Dr. Fred Bergsten, for a fascinating conversation in this podcast episode. He argued that the current state of the United States economy is very strong. Yet statistical aggregates can overlook our individual experiences, which have been notably negative about the economy for some time now.
Dr. Bergsten indicated there is a bipolarization of the labor force, describing it as moving towards two extremes, “where professional or economic success requires either very high education and training or not much at all.” He detailed that even with the best of hustle and effort or with a bachelor’s or graduate degree, many people do not achieve upward economic mobility or make it to the top. Instead, they land either at the lower end of the labor force or in the middle, where family incomes have largely stagnated over the past few decades (as costs have risen).
This bipolarization of the labor force and stagnated middle class reflect a critical shift from the upward economic mobility that the United States previously enjoyed. It is true the playing field has been uneven, opportunities have not been accessible to many Americans, and privilege has played a significant role in both achieving and maintaining top ranks in society. Still, our nation has long had a reputation as the “land of opportunity,” and the American Dream and meritocratic notion that hard work brings financial rewards is still etched into our social narrative. Yet contemporary analysts argue that globalization, AI, and increased access to education have changed the landscape for upward mobility, creating a disconnect between the American Dream narrative and many people’s financial realities.
Dr. Bergsten detailed that this mismatch has led many to feel they are losing out on the status, income, and opportunities they expected, leaving them unable to fulfill their lifelong aspirations.
It is no wonder so many Americans feel down and anxious about the economy. Working hard towards a life dream only to discover it is no longer attainable is disheartening. Applying an outdated formula such as, ‘work hard to achieve greater financial security’ – a message I continually hear teachers, parents and even our presidents promote – only to find oneself not quite good enough for these rewards is anxiety-provoking and depressing.
By definition, most people cannot be at the top. When economic prizes are primarily reserved for those at the top, it reinforces the extremes rather than the moderation we promote in gold-standard mental health treatments. Within the walls of therapy, individuals detail their extreme perfectionism, overworking, and excessive striving are driven by the pressure to achieve financial stability or upward mobility. Others have given up trying all-together. Many abuse substances aimed at enhancing work performance and helping them cope with their increased financial stress. Feelings of despair and insecurity take over when financial stability and opportunity are still out of reach despite all efforts.
Struggling, anxious, and discouraged individuals do not generally flourish or fulfill their potential. This, in turn, can negatively impact productivity and innovation – some of the bedrocks of the American economy, and contribute further to our mental health crises. As the government focuses on the economy, recognizing its profound impact on mental health can reshape lives, communities, and our very well-being.