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I think that one way in which Kazan is able to expose the American dream as illusory lies in how other forces end up controlling one's dream. Kazan challenges the autonomy that is so much a part of the traditional notion of the "American Dream." Kazan shows that there are other forces that end up controlling the individual. Terry is unable to "be somebody" because he has to do what the neighborhood hoods and his brother tell him to do. Living on the docks as Terry does means that the closest he is to escaping into a realm of freedom and autonomy is watching the boats sail by his view. Everything he does and his entire consciousness is centered on serving others. Kazan ends up showing that for the poor in America, the idea of an "American Dream" is illusory, to a great extent, because individuals in the position of power will always control those who do not possess control over their own lives.
Another component of Kazan's argument enhances this idea of exploitation. For people like Terry and the other dockworkers, the options are limited. It is highly unlikely that they are going to open their own businesses or break free from the hoods that control them. Kazan presents a vision of those who lack education, autonomy, and power will always have limited options. These set of options is where the American Dream becomes illusory. Even with Terry standing up and inspiring the other workers to attempt to do the same, the reality is that their options in being dockworkers are limited. Kazan's treatment of the American Dream is one in which if one is not committed to finding ways to transcend their condition, illusions abound and happiness is far from permanent and settled. Instead, individuals will always have to settle for being a means to an end and treated by others as such.
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