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Page last updated at 08:30 GMT, Wednesday, 2 July 2008 09:30 UK

Is the American Dream in business?

With barely four months to go to the day of the US presidential election, the BBC's James Naughtie finds Americans worse-off than they were seven years ago - and worried about the future.

East Grand Boulevard in Detroit is still handsome, in its way. There are wooden and brick houses on spacious plots, with trees front and back. They have that early 20th Century confidence that American architects were able to exploit, with high chimneys, wide porches and plenty of room inside.

East Grand Boulevard
East Grand Boulevard represents a generation of inner city decline
But many of them are not homes any more. They're empty, bricked up, maybe open to the sky or burnt-out. As a street, it represents a generation of inner city decline.

You can find plenty of prosperity around the edges of Detroit. But take a trip down East Grand Boulevard and into the enclave of Hamtramck, which was the heart of the American car industry, and you can sense the economic angst that's gripping the country.

It's not simply that there is poverty in Detroit - which you can find at the busy soup kitchens that were established in the Great Depression - but that a city which once boasted some of the best-paid industrial workers in the US is in steady decline.

Politics in Detroit is a mess - the mayor has just been deposed by his own Democratic supporters over his use of public money to try to cover up an extra-marital affair - and economic prospects are bleak.

FIND OUT MORE...
James Naughtie's series, American Dreams, continues on BBC Radio 4, on Mondays, at 2000 BST
Or Listen Again to the first programme in the series

People who thought they would remain reasonably comfortable are discovering that rising medical bills, falling wages and petrol at $4 a gallon are making life difficult. Add to that the pressures from the banks and mortgage lenders, and you find trouble.

Watershed

More than 73,000 homes were repossessed in the city in the second half of 2007 because the owners couldn't keep up with loans: Detroit is a prime example of a contagion that's sweeping the whole country.

Empty house
Home repossessions in the US are expected to spiral
In the course of this year, between two and three million homes are expected to be the subject of "foreclosure".

This is one of the painful facts that lie behind the rhetoric of the presidential campaign. The reason why both John McCain and Barack Obama talk about "change", is that most Americans feel that this election year marks some kind of watershed.

They're not agreed, of course, about which way the country should turn. But there is a general sense that after the eight Bush years, in which the country has been tormented by post-9/11 national security worries and war, and in the course of which government spending has soared and personal debt has become an obsession, this electoral choice will be important.

Searching for the worries that give rise to that belief, you first of all confront the lack of economic optimism.

Although you can find those who talk of a cycle that will turn once again, about the long-term inevitably of recovered prosperity, it's much easier to find people who are starting to question their birthright. Is it true, as they've always been taught, that the next generation will always be better off than the one before it, that hard work will produce rewards and the freedom to choose a lifestyle?

In short, is the American Dream still in business?

'Katrina-like crisis'

I found in Detroit that there are doubts. Among car workers, who were once the elite of the labour force, there is deep gloom.

The weakness of the dollar overseas can be seen a measure of the troubles of the superpower
While I was in the city, a strike at the component manufacturer American Axle was settled with a deal in which the workforce accepted much lower wages and health benefits. They got what they could, and it wasn't much.

Talking to some of those who are losing their homes through foreclosure, having stumbled into loan agreements that allowed interest rates to be ratcheted up, I became quickly aware that the problem is not one that is confined to what might be called, over-simplistically, an "underclass".

As one woman put it, it's a "Katrina-like crisis" - the waters are lapping around the feet of those who never thought that their homes would be inundated.

In America, it's always important to balance bad news or public anger with the country's innate capacity for ingenuity and recovery. But, as Joe Stiglitz, Nobel-prize winning economist, put it to me: "The reality of each generation being better off than the last is becoming destroyed."

Most Americans, he says, are worse off than they were seven years ago. So, when they come to make their political judgements this autumn, this is what will affect them most.

Barack Obama campaigning
Change has become a buzzword of the election
Remembering the effectiveness of Ronald Reagan's question in 1980 after Jimmy Carter's four years - "Are you better off than you were four years ago?" - you realise how important this is. Many Americans aren't convinced that this downturn is another blip in a cycle that will quickly correct itself; they worry about something deeper.

They know that China holds much of America's public debt, and that jobs are going overseas. And they're aware that the weakness of the dollar overseas can be seen a measure of the troubles of the superpower.

They wonder, therefore, whether they can assume that in the 21st Century their country will remain an economic superpower, even if its military strength is still unmatched.

It's a deep question, lying far beneath the surface of a presidential campaign in which the personalities of the candidates and a speech here or there often determine the headlines and the tone of the exchanges.

The truth is, this is a troubled nation. And one of the problems is this: change may be necessary but where should it lead? In the next four weeks that's what I'll be trying to find out.

You can listen again here to the first programme of James Naughtie's series, American Dreams, for BBC Radio 4. The next three programmes can be heard on Monday evenings at 2000 BST.


Electoral College votes

Winning post 270
Obama - Democrat
365
McCain - Republican
173
Select from the list below to view state level results.


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