Americans retain optimism in recession

WASHINGTON (Reuters) - Americans remain broadly optimistic about their economic prospects in the middle of the most severe recession since World War Two, according to a survey released on Thursday.

The Pew Economic Mobility Project found that despite dismal economic conditions and decades of widening income inequality, Americans still widely believe in the "American Dream": the idea that success is determined by one's willingness to work hard, not the circumstances of one's birth or other external forces.

The nationwide survey of 2,119 adults found that:

* 79 percent said it is still possible to get ahead in the current economy;

* 72 percent said they believed they will personally be better off 10 years from now;

* 74 percent said they were at least somewhat in control of their economic situation, but only 43 percent said that other people were in control;

* 71 percent said personal ambition was a more important determinant of success than external conditions.

But the survey also reflected the worsening economy: only 32 percent rated their own personal circumstances as "excellent" or "good," down from 52 percent in 2006.

"There is a strong and a uniquely American optimism which is persisting even in the face of these very, very trying times," said John Morton, the managing director of economic policy at the Pew Charitable Trusts, the nonprofit organization that sponsored the survey, which has a margin of error of 3.4 percentage points.

That optimism is somewhat at odds with the group's 2008 report, which found that parents' income is strongly linked to one's chances to succeed.

Some 39 percent of those surveyed said that it is common in America to be born poor and become rich, when in fact only 6 percent of Americans born to parents in the poorest fifth of the population end up in the richest fifth.

Most did not believe that the chances of success are tied to parents' income when in fact a strong link does exist, the group said.

The survey, conducted between January 27 and February 8, also found widespread skepticism toward government efforts to reduce inequality. Some 46 percent said the government does more to hurt than help people's efforts to move up the economic ladder.

But specific government policies got a better reception.

A majority of respondents backed making college affordable, reducing healthcare costs, making retirement savings easier and improving early childhood education -- all efforts that President Barack Obama has proposed in his first months in office.

(Editing by Philip Barbara)