Who started the whole “American dream of homeownership,” anyway?
It's not in the Declaration of Independence. Not in the Constitution. Not written into law — although encouraging homeownership has in fact been U.S. policy since the New Deal.
But who first came up with the American dream part?
Historian and author Eric John Abrahamson gives credit for the idea, although not those specific words, to the U.S. League of Local Building and Loan Associations and its first president, Seymour Dexter, back in the 1890s.
No wonder the idea is part of the very fabric of middle-class America — that's 120 years of propaganda.
And it is propaganda, which is only a bad thing if you disagree with the ideas being propagandized. It is not impartial information, this lofty notion, “American dream,” attached to a human need as basic as shelter. It's meant to be persuasive, not merely informative.
Abrahamson's work, in “Building Home: Howard F. Ahmanson and the Politics of the American Dream” (University of California Press) is so interesting that it's worth more than one mention. My review of the book is coming. It's a biography of a Nebraskan-turned-Californian, an insurance man who grew wealthy making his way through the mixed economy that supports and sustains U.S. housing.
In the 1890s, personal credit history was still by word-of-mouth for local building and loan associations (later called savings and loan associations) — think Bailey Bros. Building & Loan in “It's a Wonderful Life.” (Pause to ponder that and, if you're old enough, to remember: credit by word-of-mouth).
A few national building and loan outfits moved into local markets, but the Panic of 1896 and recession caused the nationals to fail while the locals survived. Locals nonetheless responded to competition from the nationals, Abrahamson wrote, by organizing the U.S. League of Local Building and Loan Associations.
Dexter “borrowed from Thomas Jefferson, who had believed that independent farmers, as owners of productive property, would sustain the independence and virtue of the citizenry and the health of the democracy,” Abrahamson wrote. “In Dexter's reconstruction, the home rather than the farm became the locus of this civic virtue.”
Dexter saw industrialization and the growth of cities as a challenge to democracy.
“Forced to live near factories where they were employed, wage earners occupied rented rooms or houses. In Dexter's view, this situation fundamentally corrupted the American political system,” Abrahamson wrote.
Jefferson's family farm was already long gone as the bulwark of democracy. The real safeguard, for the 1890s and beyond, Dexter believed, was the American home.
And so, under Dexter's leadership, U.S. League of Local Building and Loan Associations adopted the motto: “The American Home: The Safe-Guard of American Liberties.”
Some smart-as-a-whip ad man probably saw that and turned into “the American dream.”
The dream persists, despite the late unpleasantness in housing and continued obstacles to housing credit. The latest housing stats show that reports of the dream's demise have been greatly exaggerated.