I'm an educational pessimist in the sense that I first and foremost believe that it's impossible to take a person on the left side of bell curve and via longer or better education transfer them into the cognitive elite on the right side. IOW, I think that politicians' calls for more education mostly result in longer education to the benefit of educational institutions and banks. This has unfortunate side-effects: More student debt + race to the bottom in terms of credentials, hence "must have bachelor degree + ability to lift 50pounds". This whole idea about sending everybody to college will ultimately turn out to be a stupid idea: it hurts individuals because they got into debt and it hurts society because it wasted resources.
Looking at the Gatsby curve, it's quite evident that you're better off pursuing the American Dream in Denmark or the Scandinavian countries in general as those have the lowest odds of children ending up in the same social class as their parents.
How are these countries different from the US?
They're different in that there's a lot of money and services being redistributed towards mothers and early/preschool childhood development (<5 years old) in terms of daycare, etc. Mothers (and fathers) get very generous parental leave. As far as the child is concerned, it does not matter if you're a single mother in Scandinavia. This ensures that all children start out on a fairly equal basis whereas in the US a rich parent can ensure that their stupid child gets a significant leg up by paying for private tutors, fancy preschools, ... and generally building their extracurricular resumes before the toddlers even know what a resume is. In Scandinavia, to a large degree ALL children get to eat the same cognitive diet until they're 12+ years old. Of course there are still mobility effects but they're the lowest in the world.
In a way, being born rich in the US in terms of success later in life is what being born in January is to success as an athlete: You'll always a bit stronger, taller, and bigger than those born in December. This is crucial for further development since teenage sports is idiosyncratically divided according to which year you were born in (say 2003) ... not how old you are (say 15). This translates into early wins for the rich/January crowd who is almost a year older than the December crowd. The Matthew effect takes care of the rest (on average).
There's a lot of potential talent being wasted in December or the poverty class. Those with athletic talents who end up being born in December give up their sports career in their teenage years because they can't beat the January guys in their respective age bracket. Being 50 weeks older matters a lot when you're a teenager in the beginning of your sports career. (This is also why some parents hold their children back ... so that the kids have 1 year of maturity on the other kids when it comes to competition. That doesn't work in sports unless you lie, but it does work in education.) Those with cognitive talents who end up being born to poor or unconnected or uneducated parents have the same problem. Having access to fancy tuition matters a lot when you're 5-10 years old.
So there's the policy suggestion. One answer that has been demonstrated to work is to heavily regulate resource allocation towards children below the age of 10 or so. Beyond that, there's not much money can do anymore. The price of that redistribution is that it costs money. Therefore countries where the influence of advantages and disadvantages is removed from the talent pool also end up with less inequality (the Gini index).
Ponder how much athletic or cognitive talent is lost when a society is inefficiently directing resources towards athletes who are born early in the year or towards cognitive workers who are born to rich parents and away from those who are born in December or to parents who can't afford fancy preschools.
Deregulating serves to make the "free market" create its own form of regulation in the form of cartel-like structures. This is essentially the situation that dominates the US more so that the countries at the other end of the Gatsby curve. You see this effect in education. You see this effect in health care(*). In the US, in practice, you get different health care depending on whether you have a full-time job or a part-time job. Ditto education.
(*) Those who have traveled to Europe (north and south) as well as the US might have noticed that you could plot people's height on the Gatsby curve as well. Average population height is epigenetic and relates to how healthy and well-fed a country was two generations ago. You find the tallest people (on average) in Northern Europe. Same place as where the social mobility is highest and the inequality is lowest. Americans are not very tall relative to the rest of the developed world. Not that healthy or educated either. As an individual, I'm average in NE... but I have a one-head advantage over the average person in the US as well as in countries below Germany. This benefits me in crowds, concerts, ... stand-offs. It's a great privilege and mostly thanks to my grandparents' government system.
This works as long as people can tell themselves great narratives cf. how the American Dream is least likely to happen in the US yet remains dominant as a cultural narrative in the US. This irony is lost on most Americans which is exactly why that meme works so well. The deeply ingrained belief helps propagate the system. Ditto
"freedom".
You can see this as a country based thing, a state based thing, or a city based thing.
In the US its fun to see it on a county-based basis. It's astounding that counties that voted blue in 2016 represented 2/3 of US GDP but only slightly more than 50% of the population. IOW, blue counties are TWICE as productive as red counties. You can likely derive the same result by looking at urban/rural counties. Cities---where the cognitive elite lives---are simply more productive. Not just a bit more. Twice as much!
You can plot education along similar lines. The "educated" or cognitive people live in cities. If you're cognitively talented and got born in the countryside and you moved to the city for education...you'll probably stay in the city. Since this flow is not symmetric, there's a brain or rather cognitive drain effect from the country.
(Insofar that moving is hard, that compounds the issue. Think tech. AI. ...)
Interestingly, until recently, the US benefited from talented people born elsewhere emigrating to the US. If you're already born and talented, moving to a country with a high Gini index is a good move for you as a [talented] individual. Conversely, a country with a high Gini index is not a good place to get born. Conversely^2, being talented, leaving a country with a low Gini index is also a good move (for you as an individual). Scandinavia has long been frustrated about their brain drain.
Recent US politics have worked to reverse this with some success. Talented people from other countries are now less likely to want to go and live in the US because of #MAGA. Under the previous administration, talented immigrants were prevented from leaving again lest they suffer significant clawback in the form of an exit-tax. They still are.
Is this a good thing? It depends! Would you rather have a small piece of large pie than a large slice from a small pie. What if the former is larger than the latter? In terms of sheer amounts, the former should be more appealing ... but ordinary humans universally prefer the latter beyond the point where absolute necessities (clean water, warm home, ... about $10,000/year of consumption) are satisfied. People compare themselves to their neighbors, first and foremost.
This [innate psychological] effect creates the resulting politics, wherein the two-party system in the US (and the UK) exhibits the most extreme result of that effect.