The American Dream is a core part of our national ethos. It is the idea that anyone can advance up the economic ladder with hard work and determination, regardless of where they come from or what zip code they’re born into.

Over the last few years, however, the American Dream has taken a beating, and not just because of the Great Recession. A number of careful studies have found that there is less upward mobility in America than in other wealthy countries, such as Germany, Demark, Sweden, and the UK. In fact, only 8 percent of Americans born in the lowest fifth of the income scale ever make it to the top fifth in our so-called classless society, while the percentage is 11 to 14 percent in these “Old European” countries.

These new revelations would have shocked Alexis de Tocqueville, the French aristocrat who traveled through the United States in the 1830s and was among the first to write about the restive, egalitarian scramble for material success that then characterized America, so different from the class-bound Europe of his day.

Fortunately, America may be able to get back in the upward mobility game by paying greater attention to another phenomenon that struck Tocqueville about Americans in the 1830s: our propensity to join groups and volunteer our time for the public good.

“Americans of all ages, all conditions, and all dispositions, constantly form associations,” the Frenchman observed in his famous book Democracy in America. Americans, he continued, banded together not only to advance their political and commercial interests but also “to found establishments for education, to build inns, to construct churches, to diffuse books … and in this manner they found hospitals, prisons, and schools.” Whereas in Europe such civic endeavors were typically controlled by wealthy individuals or the state, in the U.S. average citizens worked together to drive these organizations.

Today, Tocqueville would be writing about our nonprofit sector, or civil society. It is comprised of a vast array of different kinds of groups—local sports leagues and PTAs, church-based charities, labor unions, business and professional societies, fraternal organizations like the Elks and the NAACP, and national cause-oriented membership groups like the Humane Society—that operate in the space between the individual and the government.

This sector gained renewed attention in 1995, when Harvard’s Robert Putnam published an article (later a book) called “Bowling Alone,” in which he posited that the tradition of voluntary association was in steep decline in America. Citizens, he argued, were increasingly apt to spend their time watching TV rather than attending Rotary Club meetings. Many academics questioned Putnam’s thesis—old-line fraternal organizations might be losing members, they observed, but youth soccer leagues are burgeoning and social media like Facebook provide alternative ways to connect.

Still, Putnam’s work galvanized academic interest in “social capital”—the phrase sociologists use for the benefits that complex networks of friendships and connections bring to individuals and societies. Further studies showed, for instance, that levels of social capital varied greatly across the country. In some regions (the Northeast and the Upper Midwest), citizens are far more engaged in civic activities and connected with each other than in other areas (the Deep South and Nevada). Other studies found that communities with higher levels of social capital suffer less unemployment during recessions. As evidence of a link between civic engagement and economic health accumulated, the group Opportunity Nation included indicators of social capital among the sixteen indicators of local economic health in its Opportunity Index (see here).

Then, this summer, a much-discussed study from a team of economists from Harvard and the University of California at Berkeley showed, for the first time, how rates of upward mobility vary geographically across the United States. The study from the Equality of Opportunity Project found that children born in the bottom quarter of the income scale in, for instance, the Denver metro area were twice as likely to rise to the top quarter as those born in Charlotte, and those born in the San Francisco Bay Area were three times as likely. Even in areas with similar average incomes, the rates of upward mobility dramatically differ. On average, lower-income children in metro Seattle who grew up in the bottom 25th percentile of income do similarly well as middle-class children in metro Atlanta.

Though the researchers couldn’t prove what causes these geographic disparities in social mobility, they showed correlations. Among the strongest correlations—higher even than the quality of local high schools or the availability and affordability of local colleges—turned out to be social capital. Literally, the more bowling leagues, nonprofits, and similar groups per 10,000 residents, the more likely the area’s young people were to rise economically. And this was true not just for those whose parents were involved in these groups, but for all young people in the community.

What might account for the connection between a place’s social capital and the economic success of its children? No one can say for sure, but Putnam, who is writing a book on the subject, puts it this way: “Upward mobility is aided when everyone in a community thinks of other people’s kids as ‘their’ kids.” In other words, in civic-minded communities with thick webs of interpersonal connections, individuals help not only their friends but also others in the community whom they might not know—with a basket of food, or a summer job offer, or inside information on who are the best teachers and counselors at the local high school.

Social capital, in other words, expands our notion of “we.”

If social capital is a critical component of social mobility, what can be done to increase its stock? Part of the answer is to be found in two other attributes that correlate with upward mobility: middle-class wages, and families with involved parents. Places with lots of both also tend to have high rates of social capital, which makes sense: two-parent households with sufficient incomes are more likely to be able to be involved in civic affairs. So anything that generally allows families to enter or stay in the middle class, and specifically policies that help them cope with the stresses of modern life—like more-flexible work schedules that free parents to invest more time in their families and communities—will likely strengthen social capital.

Another way to grow social capital is to expand programs of national and community service. These programs strengthen civil society in three ways.

First, they act as a force multiplier of people and resources. Take AmeriCorps, the federal domestic national service program that provides a modest living stipend and education award to those who give a year of full-time service to their country. AmeriCorps members are mostly detailed to nonprofit organizations like Habitat for Humanity, where, instead of swinging hammers themselves, they typically organize armies of unpaid part-time volunteers. They make sure hammers and drywall are at the housing site, that volunteers get the right training, and that food and water are at the ready. In other words, they build the capacity of nonprofits to engage with the broader community. The federal agency that runs AmeriCorps, the Corporation for National and Community Service (CNCS), also smartly ensures that government resources to the nonprofit leverage a private-sector commitment.

The second way service programs build social capital is by opening up opportunities for lower-income young people who are disconnected from school and work. YouthBuild, for instance, a nonprofit service initiative partially funded by federal grants, employs disadvantaged young people in community construction projects while helping them complete their education and get jobs. In 2010, 78 percent of YouthBuild enrollees completed the program, 63 percent obtained their GEDs or high school diplomas, and 60 percent went on to post-secondary education or decent-paying jobs.

A third way national and community service builds social capital is by expanding our notion of “we.” Programs like AmeriCorps typically bring individuals from different geographies, races, ethnicities, party affiliations, and income levels together in common national purpose. It’s no accident that one of the greatest periods of both civic involvement and upward mobility in America came in the years after World War II. A generation of Americans had grown up having witnessed the Civilian Conservation Corps, which put three million young unemployed men to work on our public lands over a decade. That generation went on to serve in the war, when the universal draft and the experience of fighting beside soldiers from widely different geographic, ethnic, and income backgrounds broadened the nation’s sense of collective identity. Not surprisingly, the “Greatest Generation” volunteered more, joined organizations more, gave more in charitable contributions, attended church, school, and community activities more, and were active neighbors, helping those in need more than the generations before or after it. Interestingly, during the same period when our civic stocks rose, Americans also voted more, entered public service in greater numbers, and had much lower levels of political polarization than we see today. Even the gap between rich and poor was smaller.

That willingness to give something back isn’t unique to the Greatest Generation. Millennials, who grew up during a time of war and economic stress, are showing such strong civic inclinations that the demand for service opportunities far outstrips supply. Applications to AmeriCorps soared from 359,000 in 2009 to more than 580,000 in 2011 (the latest year for which numbers are available) for only about 80,000 slots, half of which are full-time. There were 150,000 requests for applications to the Peace Corps for the 4,000 annual openings in 2011. Other service programs are similarly oversubscribed, like Teach for America (48,000 applications for 5,800 positions). This gap represents wasted democratic energy and social capital that could be put to work at very low cost to improve our country.

Recognizing this growing demand, a strong bipartisan majority in Congress passed, and Barack Obama signed, the Edward M. Kennedy Serve America Act in 2009, which authorized a tripling of AmeriCorps from 75,000 to 250,000 members. But with the budget wars that commenced after the 2010 midterms, little of those extra funds materialized. The House even voted to eliminate all funding for the CNCS and the programs it administers, like AmeriCorps (thankfully, those cuts didn’t become law, although Senior Corps was cut dramatically).

In response to congressional paralysis, Obama in July issued a presidential memorandum instructing federal departments and agencies to use existing recourses to create their own service programs to support their missions. These agency-specific service initiatives will be modeled after programs like FEMA Corps, a new partnership between the Federal Emergency Management Agency and the CNCS that trains and deploys teams for ten months to aid in disaster relief.

The outside momentum for national service is also building. Groups like Voices for National Service, which leads the effort to boost funding for AmeriCorps, and ServiceNation, which championed the passage of the Serve America Act, are keeping the service field together right at a time when the country needs their advocacy and creativity most. And this summer, the Aspen Institute established the Franklin Project, led by retired General Stanley McChrystal, to help realize the goal of engaging more than one million young Americans between the ages of eighteen and twenty-eight in a year of civilian national service, on par with the more than one million Americans on active duty in our military.

To help reach that goal, the Franklin Project will challenge private-sector institutions, be they universities or nonprofits, to create, fund, and manage new opportunities for national service. These new positions will be certified by a new entity and advertised on a digital site listing all national service programs and positions. The site will effectively serve as a combination of and Kickstarter—that is, it will make it easy for young people to apply for a wide variety of national service positions, while also enabling corporate and other sources of support for such service opportunities. The system will take advantage of technology, social networks, and civil society to democratize and modernize national service.

The challenges and opportunities facing this country are big. And we need bold solutions to deal with them. For more than eighty years, national service programs have shown that they can strengthen communities, transform service participants, and build the social capital we need to make the American Dream a reality for all. Millennials are clamoring to serve their country, and such service could boost their economic mobility in a tough economy. We should give them that chance.

To read more from our November/December 2013 cover package on opportunity in America, click here.

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John M. Bridgeland and Alan Khazei are, respectively, CEO of Civic Enterprises, former director of the White House Domestic Policy Council under President George W. Bush and a member of the White House Council for Community Solutions under President Barack Obama; and CEO of the Action Tank and cofounder of City Year. They are co-chairs of the Franklin Project at the Aspen Institute.