On Tuesday, January 28th, 2014, President Barack Obama brought the growing conversation about the inequality and barriers to opportunity in America even more acutely into the national spotlight. The President outlined our nation’s stagnant social mobility and our shortcomings in terms of preparing our citizens for 21st Century jobs. At Living Cities, addressing these issues is our mission, so we were energized to hear the President reference how, “We know where to start: the best measure of opportunity is access to a good job.”

Over the past few years, it has become clear that making a dent on inequality means ensuring that people are prepared for 21st century employment, that places enable and connect them to those opportunities, and that opportunities to grow income and reduce income inequality are created .

We recognize that transforming systems so they prepare and connect all people to opportunity, and that opportunities are created is a complex undertaking with no existing solution. However, we believe that there are levers that are foundational to addressing inequality:

Collective Impact for Systems Change. Through the coming together of decision-makers from the public, private, philanthropic and non-profit sectors to set ambitious goals, we can challenge conventional wisdom and fix problems long written off as unsolvable. Using data to transform systems and hold themselves accountable for results however, is key. Through this framework, in just six years, the Strive partnership in Cincinnati and Northern Kentucky has moved the needle on education, including a 13% increase in school readiness, a 16% increase in 4th grade reading levels, and a 7% increase in college enrollment.

Capital Innovation. Fixing broken systems is challenging without an ambitious agenda to leverage public and private capital. That means changing existing funding flows when data shows they aren’t achieving the desired results; using subsidies to best leverage public dollars; and maximizing private investment. Capital innovation is vital to improving government performance and leverage private investment for the benefit of low-income people. We see great promise in the current energy around Pay for Success: A model that brings private-sector discipline and resources to public-purpose activities across a broad array of issues, from youth recidivism to health.

Public Sector Innovation. We need networks of entrepreneurial public sector leaders to identify and accelerate innovation: Experimenting with the use of civic technology to transform the relationship between municipal government and city residents, incentivizing more effective public sector collaboration in cross-sector initiatives and building improved understanding of the public sector’s role in improving a place’s ability to attract private investment for public purposes. Our Project on Municipal Innovation aims to do just that, bringing Chiefs of Staff from around the country together twice a year to share learning and ideas for addressing wicked problems that they all face.

When fostered and applied together, these three elements hold great promise for reinvigorating the American Dream for future generations. “That’s what drew our forebears here,” the President emphasized on Tuesday night. “It’s how the daughter of a factory worker is CEO of America’s largest automaker; how the son of a barkeeper is Speaker of the House; how the son of a single mom can be President of the greatest nation on Earth.“