Miserable by Design?

Last summer, the World Health Organization published a shocking statistic: Nearly one out of every five Americans experience a significant bout of depression during their life. It should come as no surprise, then, that antidepressants were the most prescribed medicine in America over the last decade.

Some think that these are clear signals that our economic system is broken. I have news for them: You're wrong. It's a sign that our system is producing exactly what we've designed it to produce.

As any Econ 101 professor will tell you, the definition of economics is the study of the (optimal) use of limited resources, and not just the study of money, production, and consumption. But the way we've set things up, it'd be easy to think it's the latter.

The perils of gross domestic product
Every year, we push to make the GDP of our country edge ever higher, often in the misguided hope that there is no limit to growth. If you don't think GDP matters, don't fool yourself: What's measured matters.

British economist John Maynard Keynes believed that by the late 20th century, productivity would boom due to technological advances. Two-day workweeks would be standard, with the rest of our time devoted to family and friends. What Keynes failed to see is that our standard economic metric -- GDP -- doesn't take the human factor into account.

As a result, our economic priorities are at odds with what makes people happy and healthy. For instance, the expenses associated with wars, building of prisons, and even legal fees for divorce attorneys all have a positive impact on GDP. Yet these very same factors often keep us from enjoying all life has to offer.

Faced with this conundrum, several organizations have attempted to devise alternative methods to measuring economic progress. This is most demonstrably evident in the country of Bhutan, which uses gross domestic happiness as its metric of choice.

But I want to focus today on a metric devised by the New Economics Foundation called the Happy Planet Index, and show why it would be worth our while to start actively measuring it.

Perhaps the most appealing aspect of the HPI is its ability to take three very complex factors -- subjective well being, health, and resource consumption -- and simplify them into one meaningful number.

The Index's authors agree that the metric isn't perfect (what metric is?), but it does a good job of getting us to begin focusing on what really matters to most people -- namely, leading a happy and healthy life without impinging on the ability of future generations to do the same. Here's the very basic equation used to find the final metric:

Happy life years
The numerator -- which has two components -- represents the number of happy years one can expect to live.

The number is derived by multiplying the average life expectancy by reported levels of happiness on a scale of one to 10. For instance, if the average life expectancy in Atlantis is 100, and the average happiness rating is a nine, then the number of happy life years would be 90.

The first variable here, life expectancy, is relatively easy for the NEF to measure.

Source: New Economics Foundation. Green = over 75 years, yellow = 60 to 75 years, and red = less than 60 years.

North America, Australia, Western Europe, and some Latin American countries enjoy the highest life expectancy, while most of sub-Saharan Africa has a bleak outlook. It should be noted, however, that the countries of Malta, Costa Rica, Cuba, and Chile are able to accomplish relatively high life expectancies with a per capita GDP of less than $20,000.

The next part of the equation is evaluating the subjective quality of those years. This is measured by questionnaire on a scale of one to 10.

Source: New Economics Foundation. Green = above 7.0, yellow = between 5.5 and 7.0, and red = less than 5.5.

As the authors point out, when we have to determine if being wealthy and being happy are related, answer is "Yes, but..." Making money matters to the point where basic needs are met, but after that, the correlation weakens significantly.

The countries with the highest happy life years are Costa Rica (66.7), Norway (64.6), and Canada (64.0). Perhaps of most significance, Costa Rica is able to achieve higher life satisfaction (8.5 versus 7.9) and higher life expectancy (78.5 versus 77.9) than the United States on just one-quarter of the GDP.

Environmental footprint
But the number of happy years we spend on earth is only half the equation. Now we have to move to the denominator -- environmental consumption. This lets us know what kind of world we'll be leaving our children.

It is here that many high-GDP countries run into problems. To determine how much a country consumes, NEF measures how many planets would be needed if everyone consumed the same amount of resources as the people of any given country.

Source: New Economics Foundation. Green = less than one planet, yellow = one to two planets, red = two to four planets, and dark red = more than four planets.

Though Western Europe, Australia, Japan, and Canada all do poorly, the United States ranks abysmally low when it comes to consumption. We behave as if there were resources equivalent to more than four planets out there for our use.

Before throwing your hands up and disregarding such findings as eco-psychobabble, consider the crucial point -- our planet has a limited number of resources and a rapidly growing population. If we continue on the path we're on, we'll suffer the consequences.

Our most efficient economies
There are some key takeaways from the HPI:

  • The regions of the world ranking highest in HPI are Central and South America, as well as Southeast Asia.
  • Three factors that correlate strongly with high HPI countries: aspirations that are not materialistic, strong familial and communal ties, and strong social capital (having a voice that's heard and appreciated in society).

Right now, our system is producing exactly what we measure it to produce -- outsized production and consumption. If we think there's more to life (and our economy) than simply production and consumption, we don't need to need to do away with GDP altogether. Rather, we need to supplement it with metrics that measure what we're truly looking for.

To be honest, this article could go on and on, and this topic deserves far more coverage than I'm able to give it now. If you wish to read NEF's latest report in full, simply click here. Otherwise, sound off in the comment section below, and let me know what you think about how we measure economic progress in our country.

You can follow Fool contributor Brian Stoffel on Twitter, where he goes by TMFStoffel. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days. The Motley Fool has a disclosure policy.

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  • Report this Comment On March 26, 2012, at 5:22 PM, CaptainWidget wrote:

    Any metric on happiness that ends up with Bhutan as the winner is fundamentally flawed. This is a country that had BANNED television and internet until 1999.

    I would argument that demand is as big as there are unfulfilled human desires (infinite). It's in the nature of humans to want more. There isn't limited to the people of the US. The people of Bhutan want more for themselves as well.

    Utility is completely subjective. So trying to rate a nation's prosperity on it is futile. People in America are unhappy for lots of reasons. Because we have so much great cheap isn't one of them.

  • Report this Comment On March 26, 2012, at 7:08 PM, phexac wrote:

    Aaaaaand we have hit a new low in article quality

  • Report this Comment On March 26, 2012, at 7:27 PM, ryanalexanderson wrote:

    > Any metric on happiness that ends up with Bhutan as the winner is fundamentally flawed.

    The article said nothing about Bhutan winning a competition. It said - as well as the article it linked to - that Bhutan was one of the first to start -measuring- it.

  • Report this Comment On March 26, 2012, at 7:47 PM, TMFHelloNewman wrote:

    You can have steady increases in the quality of goods and services and, I hope, the quality of life,

    but you can’t have sustainable growth in physical output. You can have “growth” – for now – or you can have “sustainable” forever, but not both. This is a message brought to you by the laws of compound interest and the laws of nature. However, you can try to have both. “Growth, and to hell with the consequences.” - Jeremy Grantham

    http://www.gmo.com/websitecontent/JGLetter_LongestLetterEver...

  • Report this Comment On March 26, 2012, at 8:33 PM, TMFCheesehead wrote:

    @ryanalexanderson-

    Thanks for clearing that up, always interesting to see people comment who haven't read all the way to the end.

    Brian Stoffel

  • Report this Comment On March 26, 2012, at 8:38 PM, wolfman225 wrote:

    Pure drivel. I notice that the U.S. is the only country to be honored with the darkest red color. Again, the United States is the focus of evil in the world. Let me guess, it's because of the oft-quoted "we use a greater percentage of the world's resources and have a much smaller percentage of population".

    Tell me, does this "Happy Planet Index" (what a sophomoric absurdity) weight the contributions to health, wealth, and longevity--worldwide--that have been made by our country? Advances that have been made possible, in large part, by our utilization of resources and the sharing of what we developed? Often shared with other country's poorest citizens?

    Medical advances developed in the U.S. (both pharmaceutical and procedural), along with the medical education of the majority of the world's doctors and healthcare providers is a large part of the reason for the advances in "quality of life" in many of the countries you point out as being superior.

  • Report this Comment On March 26, 2012, at 8:50 PM, wolfman225 wrote:

    We always hear about "depletion of finite resources" from those demanding that we change the way we live our lives. As if there is never any advancement in technology that makes it possible for us to access previously unreachable sources of energy.

    Those driving the push for "green shoots" and renewable energy at any cost should be the first ones in line asking "more, please". Demand drives the innovation that will create the new energy sources we will need to power the future.

  • Report this Comment On March 26, 2012, at 9:08 PM, mattholmus wrote:

    Thanks for this article. I look forward to serious and practical discussions on how this perspective could be applied to our personal investing goals. Seems to me that a rigorously foolish perspective could take the somewhat pastel world of 'sustainable investing' to an exciting endevour for risk takers charting a new and improved investment framework.

  • Report this Comment On March 26, 2012, at 9:18 PM, knighttof3 wrote:

    All living things use resources and leave the planet different than they found it. Are you complaining we are too successful at it? Resources are unlimited because (as Wolfman points out) of "advancement in technology that makes it possible for us to access previously unreachable sources of energy".

    This has nothing to do with the first half - i.e. happiness is not a linear function of wealth or GDP, which I agree with. BTW it is also not a steady-state. If 1 in 5 Americans have been depressed it's because at least some of them can feel deep emotions. Life happens. Sweetness would lose its appeal if no other taste existed.

    An unchanging "eternal bliss" happiness may be possible for the few who desire it (by control of desires through spirituality) but probably that's not for everyone. For the rest, half the fun is in the struggle to achieve our crass materialistic goals.

  • Report this Comment On March 26, 2012, at 10:00 PM, TMFCheesehead wrote:

    @wolfman225-

    I seriously suggest you read the report. Being upset because the US is dark red means won't make much sense once you read it.

    The amount of resources being used up is simply a fact--not an opinion. If you have a problem with the specific methodology, please share it. It is developed because the average U.S. citizen requires 9.4 hectares per person, and if the whole planet lived in such a way, we'd need the equivalent of 4 planets' resources.

    Advancements in technology are great, and I'm counting on them as much as anyone else. But if you back up and look at the situation from 100,000 feet, our planet has been storing and slowly creating these natural resources for literally millions of years. It's only within the last 0.001% of Earth existence that we've been extracting all of it.

    @knightof3-

    I appreciate your thoughts, you're right that happiness is not a steady state, and "life happening" is important. At the same time, when a wide swath of a population is surveyed and patterns become detectable, I think it's worth trying to draw qualified conclusions.

    Brian Stoffel

  • Report this Comment On March 26, 2012, at 10:11 PM, wolfman225 wrote:

    Another way of interpreting your colorful maps: if you want the best chance of living a long, happy life, search out, develop, and USE the resources you have to the best of your ability.

  • Report this Comment On March 26, 2012, at 10:37 PM, decebalvs wrote:

    Bravo !

    Once we have the right goals, we can struggle to achieve, and we *will* achieve, the right things.

    Blindly navigating through times, guided by misguided metrics that only and barely worked with assumptions which are no longer true, will lead us to big mistakes. US might not have the luxury of big mistakes any more.

    among other silly mistakes, wolfman thinks that US has been somehow altruistic with the world; that thought makes me laugh. Overall, US has manipulated the other countries and has sucked the best resources, and has polluted the planet.

    Of course, it's not like the other countries tried to be any more altruistic or wise.

  • Report this Comment On March 26, 2012, at 10:38 PM, wolfman225 wrote:

    You didn't get my point, Brian. I'm pointing out that the claim that any subjective measurement of quality of life is superior to another measurement, particularly a non-subjective one such as the GDP/GNP (as flawed as they may be) is ridiculous. "Subjective" = "it depends". Measurement without objective standards against which to compare your results is a worthless exercise.

    I am also pointing out the fact that yes, the US does use a large amount of resources, stipulated. It is a fact. So what? It is also irrelevant. Would you rather the world go back to the standards and quality of life that obtained prior to the 20th century? When no one had air conditioning and few had the luxury of central heating and indoor plumbing? In the "good old days", when people (particularly the aged) alternately froze to death or succumbed to the heat in the cities? When the "great cities" of the world had such a problem with the mode of transportation (horses & draft animals) that in the summertime the piles of waste created a miasma nearly as thick as the clouds of flies that brought disease to so many?

    The use of resources began ramping up during the industrial revolution. It is also unquestinable that life expectancy, as well as the quality ("happiness") of those years also began a long period of improvement. Advances in farming and agriculture made it possible to provide food to a far greater number of people than had ever been thought possible. Remember the stories that warned overpopulation would lead to mass starvation and food riots because the Earth simply could not produce enough food to support the growing population? I do. As I posted on another thread, the rumors of our impending collective demise appear to have been exaggerated. As seems to usually be the case.

    You glossed over my closing thought that those most concerned with the coming calamity should be among those first in line pushing for more. Alternatives to fossil fuels will appear. Eventually. Not because of some government-mandated program but because the demand and need for energy requires it. Necessity is the mother of invention, not doomsaying and wishful thinking.

  • Report this Comment On March 26, 2012, at 10:46 PM, wolfman225 wrote:

    @decebalvs--

    Could you please point me to where I ever said the US was "altruistic"? No such state exists in man. Nowhere.

    As for our "sucking out the best resources, and has polluted the planet." Have you taken a look at ecological conditions in China, India, and elsewhere? The US isn't perfect, but we are FAR from the worst offenders. And "manipulating the other countries" is the favorite pastime of EVERY civilization that has ever existed. It even has two official names: Politics & International Relations.

  • Report this Comment On March 26, 2012, at 11:40 PM, Boone wrote:

    @Wolfman,

    nothing in the article advocated, or even suggested, a return to "the good old days". In fact, it makes very clear that traditional metrics of measuring economic growth might have served us well through the present day but be less relevant going forward because they fail to account for resource limits. Our current economic system encourages, by failing to account for, the externalization of costs.

    Loyalty to a story irrespective of who it fits into our evolving understanding of the world in which we live can have disastrous consequences. Your "As if there is never any advancement in technology that makes it possible for us to access previously unreachable sources of energy" will not bring back the world's fisheries, over 75% of which are nearing a state of collapse and which represent centuries of stored "energy" on which people are dependent.

    Brian Stoffel, I am thrilled to finally - finally - see something from TMF that discusses limits to growth and investing in a resource constrained world. More, please....

  • Report this Comment On March 26, 2012, at 11:43 PM, TMFCheesehead wrote:

    @wolfman225-

    I think our discussion is a matter a perspective when it comes to timelines. I don't deny that technological advancements which required resource consumption improved the quality of life for people, especially throughout the industrial revolution.

    However, if we REALLY zoom out, I wouldn't have any trouble finding examples of peoples who lived long (once infant mortality is removed), happy lives on the North American continent before the 1500's, and used up almost no resources they didn't replace. These people can still be found today (as a very recent example, I suggest reading Born To Run).

    Secondly, I do believe it's worth measuring things that may not be totally objective. When enough questionnaires are answered, across a wide enough swath of people, it's actually pretty objective as to whether or not they answered yes or no as to if they are happy. Who are you, or I, to say otherwise?

    Finally, I do agree that expecting any civilization to be altruistic is ridiculous. People function in their own best interest. I guess what I'm questioning is what "best interest" really should/does mean.

    I'm glad you're optimistic for the future. I am too.

    The assumption that we'll never run out of fossil fuels sounds great...until we do. It will happen eventually, it's a 100% certainty. I have no idea if its 100 or 1,000 years out, and there's certainly the possibility of renewable fuels. But by their very definition, there's a limited amount of fossil fuels.

    I, instead, am optimistic because I think there are three very simple steps that almost universally lead to happiness, as I said in my piece:

    <<aspirations that are not materialistic, strong familial and communal ties, and strong social capital >>

    I'd really have trouble finding someone who argues with this. I'm not saying we need to do away with our current system all at once, or do away with GDP, I'm just saying the conversation needs to include a human element that its missing now.

    Brian Stoffel

  • Report this Comment On March 26, 2012, at 11:48 PM, TMFCheesehead wrote:

    @TMFHelloNewman-

    Great letter, thanks for the link.

    Brian Stoffel

  • Report this Comment On March 27, 2012, at 12:29 AM, CaptainWidget wrote:

    <<The amount of resources being used up is simply a fact--not an opinion. If you have a problem with the specific methodology, please share it. It is developed because the average U.S. citizen requires 9.4 hectares per person, and if the whole planet lived in such a way, we'd need the equivalent of 4 planets' resources.>>

    Or prices would change and people would use less.

    Like it or not, the US (and most of the first world) and our massive productivity has made these resources cheap enough that we can consume out the ying yang. If the rest of the world had the good fortune to increase their standing of living to US levels, prices would equilibrate and there would still be plenty to go around. Some of the excess production would then be used on Bhutanese needs instead of American wants...but ultimately there would still be plenty of resources to be consumed.

    However, ONLY increases in productivity will enable those Bhutanese or Indonesians to fulfill their NEEDS....because right now, these people are still starving to death. They NEED GDP growth to have the income to suck some of the resources out of the US's mighty grip. They NEED the GDP growth to fulfill their marginal utility towards staying alive (which I'm certain is greater than our marginal indifference towards the subject). If you're aruging for a lack of GDP growth, you're specifically arguing for these people to stay in starvation. If you're arguing for Bhutanese GDP growth, but US GDP decline, well then congratulations Marx, you've just stumbled upon the 150 year old problem which still has no solution. Some people will always have more. If you're arguing for something else, then I'm confused.

  • Report this Comment On March 27, 2012, at 1:44 AM, elburro88 wrote:

    @CaptainWidget

    "If you're arguing for Bhutanese GDP growth, but US GDP decline, well then congratulations Marx..."

    I'd say the argument is for continued GDP growth in all countries, but not at any expense. As long as GDP growth is the key metric for measuring progress, we'll head down the same unsustainable road we are on now. With the disastrous consequences it may have.

    We need to find a new metric that guides us in the direction of a sustainable future and this article shows one possible way of doing so.

  • Report this Comment On March 27, 2012, at 2:48 AM, CaptainWidget wrote:

    Again....we don't need any new "metric" to define our lives by. I highly doubt that even 1% of American citizens know a single GDP metric of this nation.

    We only need to know one metric for sustainable living. Price. As long as price is a true reflection of the overall sentiment of the market, we are in no risk of running out of anything ever (unless the market fails to ask for it in any amount at any price). There will always be fossil fuel, or at least the possibility of fossil fuel, in the market. As scarcity or demand increases, so will price. This will force people to more strongly consider whether they want to buy fuel or not. In 10,000 years, when most fossil fuels have been sucked from the earth, if there's still a high enough demand and commensurate price, people will be producing it synthetically and selling it to willing consumers.

    This sustainability hullaboo is junk science. The price mechanism creates sustainability, period. End of discussion.

  • Report this Comment On March 27, 2012, at 5:42 AM, Stonewashed wrote:

    Perhaps you should read this book: The Geography of Bliss. NPR correspondent Eric Weiner used this very index to travel to the countries rated highest on the index, and a few like Moldova, where things weren't so happy.

    His conclusion was happiness is a fifty/fifty proposition and he probably won't be packing his bags to move to any of the places he visited outside of the US.

    While visiting Bhutan, a man gave him this advice: To be happy, you need to set aside a few minutes a day to think about death.

    "That really hit home with me, I have to say," Weiner says. "In this country, we do not talk about death. ... We will talk about anything except for death. We will talk about how much money we make, we'll talk about our sex lives, we'll talk about politics. We will not talk about death."

    The more I read on here by the most viewed contributors, the more I feel the self-proclaimed eggheads lean towards constitutional monarchies like Bhutan. Keep in mind, these countries which are heavily influenced by Buddhism have learned to think past their misery and focus on their core. Ever take a yoga class?:) In a physical sense, that allows you to contort yourself into all manner of positions circus performers could only dream about no matter what your surroundings.

    But as Weiner visited other places the more common theme seemed to be feeling loved.

  • Report this Comment On March 27, 2012, at 6:01 AM, Stonewashed wrote:

    http://www.npr.org/player/v2/mediaPlayer.html?action=1&t...

    Interview with Weiner about his book "The Geography of Bliss"

    At the very beginning of the interview he does qualify that the happiest countries like Switzerland tend to be homogeneous and have money, they just don't flaunt it. It is very important to them, "where you come from", shall we say and for order.

    The happiest countries can count on their leaders not being corrupt.

    You are not going to have a heterogeneous society that has multi-cultural agendas and values without a corruption factor and class envy always vying for top dog.

  • Report this Comment On March 27, 2012, at 8:33 AM, pondee619 wrote:

    "The number is derived by multiplying the average life expectancy by reported levels of happiness on a scale of one to 10. For instance, if the average life expectancy in Atlantis is 100, and the average happiness rating is a nine, then the number of happy life years would be 90."

    Excuse me, but, dosen't 100 times 9 equal 900?

  • Report this Comment On March 27, 2012, at 8:34 AM, wolfman225 wrote:

    @TMFCheesehead--

    "The assumption that we'll never run out of fossil fuels sounds great...until we do. It will happen eventually, it's a 100% certainty. I have no idea if its 100 or 1,000 years out, and there's certainly the possibility of renewable fuels. But by their very definition, there's a limited amount of fossil fuels."

    This's a given. As I wrote, though, when it really gets down to it, alternatives will be either found or created as CaptainWidget pointed out. Who knows? With the early days of commercial space flight on the horizon, perhaps it will eventually be possible to "mine" asteroids for the resources we need.

    I agree that our society has become much too materialistic, but there's no sweeping back the tide. All we can do is move on from where we are now. It is the nature of man to always seek a greater, longer, more abundant life. This will never change for as long as we can imagine a better life for ourselves and our children.

    The examples you presented to illustrate your point of people being happy with less tend to be isolated pockets of primitive societies that have been almost completely isolated from the rest of the world for generations. Their lives haven't changed because they live limited lives that they aren't aware are limited in scope. What usually happens once they are made aware of the march of progress (or "contaminated by the corrupting influence of modern society") they become less "happy" with the lifestyle they had been living. This is certainly true of their younger members. Think of it this way: would any of you be truly content if, once you had grown accustomed to a modern lifestyle, you had to return to the more limited parameters of your life as a child? I wouldn't.

  • Report this Comment On March 27, 2012, at 8:47 AM, Hux77 wrote:

    Excellent article. So happy to see TMF discussing this topic. I hope it opens many eyes...

  • Report this Comment On March 27, 2012, at 10:25 AM, TMFTypeoh wrote:

    Brian,

    Great article. I whitness this phenomenon in my own family.

    Some members of my family are ultra hyper consumers. They shop, shop, shop, shop, shop. Buy, buy, buy. Non stop....its almost a sickness. They are well beyond the happy on the fulfillment curve. I wouldn't classify them as happy people.

    Then on the more frugal end (which, when compared to the rest of the world would still make us hyper consumers, I'm sure), happiness goes up.

    Once you have you needs met, and MOST (but not all) of your wants met, what more can you ask for?

    We need to give more to charity. I think we will derive huge amounts of happiness from that.

    Brian

  • Report this Comment On March 27, 2012, at 10:29 AM, TMFCheesehead wrote:

    @pondee-

    When they ran the calculation, they acted as if the happiness rating was from 0.0 to 1.0.

    Brian Stoffel

  • Report this Comment On March 27, 2012, at 10:29 AM, TMFCheesehead wrote:

    @Stonewashed-

    Thanks for the link, very interesting.

    Brian Stoffel

  • Report this Comment On March 27, 2012, at 11:00 AM, Tina71 wrote:

    As much as I like having my options in life, it seems that an abundance of options often makes us unhappy. People who are satisfied with what they have, are happier than people who only see what they don't have. Whether it's needing a newer car, a bigger house, or a prettier wife, we live trying to make our lives better, which means that our current lives are not satisfying. Enjoying what you have (as they do in Costa Rica), is one of the reasons that Costa Rica is ranked above the U.S. And yes, I am an economist...

  • Report this Comment On March 27, 2012, at 11:22 AM, pondee619 wrote:

    Brian,

    But that is not what is written. "reported levels of happiness on a scale of one to 10" Not zero to one.

    I was able to assume how they arrived at their number. But their answer does not jive with their equation. Are there any other "assumptions" we must make in understanding this article?

  • Report this Comment On March 27, 2012, at 11:25 AM, TMFCheesehead wrote:

    @Tina71-

    Good point, I didn't mention that Costa Rica ranked #1.

    @pondee-

    I didn't get into details about that since the article was already pretty long. If you wish to see if there were any other assumptions I left out, I have a link to the report within the article.

    Brian Stoffel

  • Report this Comment On March 27, 2012, at 11:27 AM, TMFDeej wrote:

    Hi Brian. I personally think that this is a fantastic article. While I don't necessarily agree the exact Happy Planet formula, I completely agree that those of us with an interest in business often become way too focused on the quantity of money and other stuff that we have rather than the quality of our and our families' lives.

    I have made a concerted effort to focus much more on the latter in my life over the past year and I would definitely say that my happiness has increased.

    Some may be disappointed that this article isn't centered around some sort of actionable investment idea, but I think that it is important to bring awareness to this issue. Not only the issue that happiness is important and that material things do not always bring it but that it is literally impossible for global consumption to continue to grow at a rapid pace indefinitely, let alone at the pace of the bubble-fueled years that many of us because accustomed to.

    Anyhow, I liked your article. If you don't like it, feel free to skip over it rather than complaining about it. Of course you are free to do so, but is being negative really the most valuable use of your time? Encouraging positivity and happiness in others should be encouraged, not discouraged.

    Deej

  • Report this Comment On March 27, 2012, at 11:30 AM, TMFCheesehead wrote:

    @Deej-

    Many thanks.

    Brian Stoffel

  • Report this Comment On March 27, 2012, at 12:20 PM, TopAustrianFool wrote:

    " Making money matters to the point where basic needs are met, but after that, the correlation weakens significantly"

    Ha ha... This is the justification for socialism being the best system.

  • Report this Comment On March 27, 2012, at 12:31 PM, TopAustrianFool wrote:

    "aspirations that are not materialistic, strong familial and communal ties, and strong social capital "

    So you say that Central and South America are not materialistic, but the arts and culture do not flourish there like they do here in the US.

    How do you explain that?

    In my experience those countries which are poor tend to be more materialistic, meaning 90 percent of their time is spent looking for material subsistence. What allows people to be happy is a mistery which has been discussed since the times of Aristotle's Nichomachean Ethics. The truth is that happiness is relative and your surveys can yield different results with different approaches. So, honestly I would tell you that people who make enough money to persue personal interests in their spare time are happier. People from those countries you think are happier tend to spend most of their time working to survive.

    In the US people pursue the most varied lifestyles, with outdoors to home bodies which read and study to traveling and plain working for what we call workaholics. What makes people happy is different, but in the US those different things are more likely to be pursued.

  • Report this Comment On March 27, 2012, at 1:33 PM, Boone wrote:

    CaptainWidget says

    "We only need to know one metric for sustainable living. Price. As long as price is a true reflection of the overall sentiment of the market, we are in no risk of running out of anything ever"

    This is such a fantastic expression of "faith" in the market, as distinct from an objective observation of how it works in practice, that now I see your arguments for not making any changes to the current version of capitalism are actually just a form of religion.

    "Price" is not only determined by "sentiment", and where the uber-neocon calls for no government regulation break down is that effective policy is critically important in making sure costs are not externalized, and are therefore reflected in price. This is currently not the case.

    Statements about price being a reflection of sentiment ensuring that we never run out of anything ever, is incredibly ignorant of both the current state of many natural resources (try reading about the New England cod or Atlantic salmon fisheries) and the history of the rise and fall of human communities that failed to confront the reality of limits.

    More drivel from the Ayn Randians, who are breathing the clean air and drinking the clean water fought for by... everyone else.

  • Report this Comment On March 27, 2012, at 1:33 PM, rhealth wrote:

    Thank you Brian, I am always interested in new ways to measure how we are living and alternative measures are slowly gaining popularity. In the end I think we should ask ourselves, which do we value more? things or people? In the US we are encouraged to value things over people because that is the way to sell goods, but any society that continues in that vein for very long is in trouble. Even though we have lots of things, as you point out in the beginning, we have serious happiness issues.

  • Report this Comment On March 27, 2012, at 2:05 PM, hbofbyu wrote:

    "Happiness: Control over what you are doing, progress in what you are pursuing, being connected with others, and being part of something you enjoy that is bigger than you (religion, charity, a higher cause)."

    Assuming that your basic needs of health, food, shelter, clothing and safety are met - which is what you want the economy to provide.

    Which country best provides health, food, shelter, safety best to all it's people? Probably Norway.

    Like someone mentioned earlier, it helps to have a homogeneous population were the majority want and are interested in similar pursuits.

  • Report this Comment On March 27, 2012, at 2:07 PM, whereaminow wrote:

    It's absolutely true that these studies are horribly flawed. In order to measure something you need an objective reference point. But let's give the overpaid State funded researcher the benefit of the doubt.

    Could there be another reason for American unhappiness besides money? Hmm, could it be the foods they eat?

    You are what you eat. And Americans eat a high grain/high sugar/high processed food diet that leaves you feeling bloated and unhappy. Of course this is the very diet that the USDA promotes.

    I'm going to go with that, because no one I have ever met who eats healthy food and is active is chronically unhappy.

    David in Liberty

  • Report this Comment On March 27, 2012, at 2:32 PM, hbofbyu wrote:

    I was perfectly happy with my 10 year old Honda Accord until my neighbor moved in next door with his Maserati GranCabrio.

    Suddenly I was not happy and I don't know why.

  • Report this Comment On March 27, 2012, at 2:51 PM, TMFCheesehead wrote:

    @whereaminow-

    Excellent point.

    @TopAustrianFool-

    You said: <<In my experience those countries which are poor tend to be more materialistic, meaning 90 percent of their time is spent looking for material subsistence. >>

    if they are poor and just eeking out an existence, I don't think it would qualify as having basic needs met. I have lived in Costa Rica on and off for two years (and not in a Gringo community), volunteering on a coffee farm and I can say with certainty that when it comes to such statements, your experience does not meet with the reality here.

    You also state: <<In the US people pursue the most varied lifestyles, with outdoors to home bodies which read and study to traveling and plain working for what we call workaholics.>>

    I would love to see a piece of data that backs this up.

    Brian Stoffel

  • Report this Comment On March 27, 2012, at 5:13 PM, juangringo wrote:

    @Top Austrian Fool

    "So you say that Central and South America are not materialistic, but the arts and culture do not flourish there like they do here in the US."

    Hmmm... I need to get out more, at least here in the States. I've yet to see a flourishing of arts and culture here (the US) in any measurable, meaningful way like I see it practiced daily in Central America, Costa Rica in particular. Of course it depends on how one views those two: museum/concert hall vs. daily delight in life, or "Pura Vida" as they say in CR. They've taken the art of living fully (what else, in the scheme o' things, matters?) to a height that all the dinero in the world can't buy. It's why I said adios to a 300+ por año grinder of a job, and haven't looked back...

    Great piece, Brian. Thanks for the reminder of why I wear this grin so often.

  • Report this Comment On March 27, 2012, at 9:09 PM, CaptainWidget wrote:

    <<This is such a fantastic expression of "faith" in the market, as distinct from an objective observation of how it works in practice, that now I see your arguments for not making any changes to the current version of capitalism are actually just a form of religion.>>

    Look up the definition of the word "demagogue". Then you'll understand why I don't bother to respond further to this point...

    <<"Price" is not only determined by "sentiment", and where the uber-neocon calls for no government regulation break down is that effective policy is critically important in making sure costs are not externalized, and are therefore reflected in price. This is currently not the case.>>

    Price is determined by two things. All knowledge in the market collectively combined by all the participators agreeing one one price and people with a gun telling you the price is something else. All the voluntary agreement in the world can't override violence to create price fixing.

    If you want to talk about absorbing externalities into the pricing mechanism, I would agree. But the American legal system has made it difficult to sue someone for pollution. This is a government failure, not a market one.

    <<Statements about price being a reflection of sentiment ensuring that we never run out of anything ever, is incredibly ignorant of both the current state of many natural resources (try reading about the New England cod or Atlantic salmon fisheries) and the history of the rise and fall of human communities that failed to confront the reality of limits.>>

    Trying reading the wikipedia page "tragedy of the commons" before you come at me, attacking my understanding the pricing mechanism. When the marginal price for additional units for anything is "free" (as in the case with cod, salmon or any other sea animal) then demand will be unlimited. Every case in history where human settlements have exhausted their resources (ocean stock, rapa nui's forrests, ect) have been a tragedy of the commons. Meaning the marginal price of communal items is free, so people use as much as they want. Yes, pricing fixes this (by making a real price, rather than pretending everything belongs to everyone).

    <<More drivel from the Ayn Randians, who are breathing the clean air and drinking the clean water fought for by... everyone else.>>More drivel from an ignorant fool who doesn't understanding the difference between Randian philosophy and basic econ 101.

    Read up on "Free Market Environmentalism" by Walter Block.

  • Report this Comment On March 27, 2012, at 9:17 PM, CaptainWidget wrote:

    <<Hmmm... I need to get out more, at least here in the States. I've yet to see a flourishing of arts and culture here (the US) in any measurable, meaningful way like I see it practiced daily in Central America, Costa Rica in particular.>>

    You can't be serious, right? Go the movies dude....

  • Report this Comment On March 27, 2012, at 9:56 PM, rodnog wrote:

    @CaptainWidget

    "You can't be serious, right? Go the movies dude...."

    I'm not sure that US cinema is the best example of arts and culture... There are some great films that come out of this country, but the film industry is... well, an industry.

    Although i think juangringo's main intent was to argue that less economically developed nations do have a great deal of arts and culture.

  • Report this Comment On March 28, 2012, at 9:27 AM, wolfman225 wrote:

    ^AT LAST! After all these days we have finally been visited by the voice of sweet reason and intelligence. I can rest easy now, knowing such eloquent luminaries as HooDaHeckNose have deigned to grace the rest of us with the benefit of their insight.

  • Report this Comment On March 29, 2012, at 2:09 PM, TopAustrianFool wrote:

    @TMFCheesehead,

    "I have lived in Costa Rica on and off for two years (and not in a Gringo community), volunteering on a coffee farm and I can say with certainty that when it comes to such statements, your experience does not meet with the reality here."

    Well, I grew up in one of those great high HPI countries you mentioned and will tell you that poverty in Latin America is widespread. Your poor here in the US is basically our high middle class there. So, I am sad that you basically lived there and practically learned nothing.

    Were you ever stopped by a police officer and stripped search for no reason? If not, then you really didn't experience anything. Go through one of those searches and the fill you silly HPI survey, then we can talk. Did you ever try to open a business and found that you had to pay bribes to just about everyone to stay open?

    Why don't tell everyone else that everytime you went out you had to bring cash for bribes. Let's be honest here. Is that what you consider a high HPI? You may have all of the socialized garbage a lot of people want here but as an individual you had no rights. Unless, you are connected of course.

    Your article is contributing to the propaganda and only people with little education or emotional bias will believe.

    How many people do you see flocking to cross the border into those high HPI countries? How many do you see trying to come here to the US?

  • Report this Comment On March 29, 2012, at 2:40 PM, TopAustrianFool wrote:

    @TMFCheesehead,

    "I would love to see a piece of data that backs this up."

    Ask the WHO, I am certain they can fabricate that set of data for you.

    Or you can look up where companies sell the most outdoor equipment, or books, or what is the country with highest amount of theaters per capita.

    You have shown your bias brother.

  • Report this Comment On March 29, 2012, at 2:45 PM, TopAustrianFool wrote:

    " Price. As long as price is a true reflection of the overall sentiment of the market, we are in no risk of running out of anything ever"

    Free market price also reflects the amount of resources a specific product or service consumes. So guess what? If Oil is cheaper than Solar by free market pricing, it also means it consumes less resources.

    Its ironic that the environmental movement is contributing to the destruction of resources, by promoting the contruction of useless solar panels and wind mills. Watch, that will be you next bubble, Alternative Energy.

  • Report this Comment On March 30, 2012, at 12:26 PM, PenguinTrap wrote:

    I'm surprised by some of the comments I read here. Rather than consider the possibility that excessive consumption can lead to unhappiness, I see a quick dismissal of the concept.

    I think, in the past few years especially, the general level of angst in our country has exploded. Political, economic, educational etc.

    It can be argued, directly or indirectly, that this level of dissatisfaction comes courtesy of a burst asset bubble. Jobs are lost, houses are lost, 401K's and IRA's shrink, retirements are delayed for some & college plans put on hold for others, fuel and food prices surge....as together we try and unwind excessive debt - - born of excessive consumption.

    Conservative principles seem to win the day, regardless of where you live. Once your basic needs are met (food, shelter, clothing with a little extra to spend any way you want), frugality and thoughtfulness mean more time doing what you like and less time worrying about your future. It isn't a difficult concept ....though I admit it's difficult for most of us to practice. I think that's the point of the article.

  • Report this Comment On March 30, 2012, at 7:13 PM, ffoolb wrote:

    @ TopAustrianFool 

    [" Making money matters to the point where basic needs are met, but after that, the correlation weakens significantly"

    Ha ha... This is the justification for socialism being the best system."]

    Using a true fact as justification doesn't make that fact less true.

    (Basic logical reasoning)

    @ CaptainWidget

    [ People in America are unhappy for lots of reasons. Because we have so much great cheap isn't one of them.]

    It could be one of the reason !!  

    Having "much great cheap" needs to be done. A part comes from productivity improvement, another comes from cost on our lives, or other's lives.

    or, are you believing in spontaneous generation?

    @PenguinTrap

    [more time at doing what you like and less time worrying about your future]

    Well explained

  • Report this Comment On March 30, 2012, at 7:32 PM, donvesco100 wrote:

    Hey, it IS eco-psychobabble, whether one throws hands in the air or not.

  • Report this Comment On March 30, 2012, at 7:40 PM, donvesco100 wrote:

    An aside: This type of article seems to be an apology for actually enjoying the process of making money. Poor people can be miserable, or happy and rich people can be miserable or happy, but liberals are guilty no matter what. Guilty and resentful. sigh.

  • Report this Comment On March 30, 2012, at 7:47 PM, donvesco100 wrote:

    Here's a laugh for the levelheaded: research who this foundation actually has in it. Explains it all...

  • Report this Comment On March 30, 2012, at 10:40 PM, Kiffit wrote:

    I am quite surprised to see an article of this type in these columns; pleasantly surprised.

    But of course, any proposed change to business-as-usual brings out the defenders of the status quo who seem to be resolutely committed to living in an intellectual bubble filled with laughing gas.

    Essentially Brian suggests the reasonably well established proposition that we as a species (some radically more than others) are living wildly beyond our ecological means, and combines it with other reasonably well established propositions, that extravagance and excess tend to produce dysfunction and damage, and frugality and moderation tends to produce the opposite, i.e.; more beyond a certain point is not only not better, but likely worse, and by implication, defeats the fundamental purposes and rewards of life.

    The all out production warfare that was templated from World War production modeling and converted the military struggle into a marketing one that 'saturation bombs' markets with goods and services 'ordinance', and goes on doing it until it blasts the environment and its servants so hard and protractedly that life at every level wilts, until it is completely flattened by a slow motion industrial Gotterdamerung!

    I live in a world run by very well rationalized pyschopaths who have become extremely efficient organizers of the march of the lemmings and an infantile mass consciousness that keeps the phalanxes in lockstep through mass fantasizing and refusal to allow mere evidence to spoil their world view.

  • Report this Comment On March 31, 2012, at 5:41 AM, Suza2295 wrote:

    There is actually considerable research being done on happiness and some interesting thoughts being put into the arena by intelligent people. In addition to "The Geography of Bliss," which I recommend on several levels, not least of which is that it's funny, but also Derek Bok's "The Politics of Happiness." He takes the results of research and translates it into what government policies would lead to a happier nation. It is a far cry from eco-psychobabble but rather an impulse to stabilize our civilization.

  • Report this Comment On April 01, 2012, at 9:51 AM, TopAustrianFool wrote:

    @ffoolb,

    "Using a true fact as justification doesn't make that fact less true.

    (Basic logical reasoning)"

    It doesn't make for that fact a true justification either. Do you know what a logical fallacy is?

    Have you read Keynes' "The General Theory Of Employment Interest And Money"?

    It's full of logical fallacies.

  • Report this Comment On April 03, 2012, at 11:14 AM, wolfman225 wrote:

    @PenguinTrap--

    <<"Conservative principles seem to win the day, regardless of where you live. Once your basic needs are met (food, shelter, clothing with a little extra to spend any way you want), frugality and thoughtfulness mean more time doing what you like and less time worrying about your future. It isn't a difficult concept ....though I admit it's difficult for most of us to practice.">>

    I agree.

    "More time doing what I like and less time worrying about my future".

    I like the sound of that. Unfortunately, there is no true security this side of the grave (I know it's a mis-quote, shoot me) and it'd take an 8-figure "cushion" to provide truly bullet proof financial security, given the chance of a recurrence of the economic upheaval we've seen in the last 10 years.

  • Report this Comment On April 03, 2012, at 7:38 PM, awarenessrus wrote:

    Thank you for writing this article. I have long noticed the same thing in my own life. Very important points.

  • Report this Comment On April 05, 2012, at 10:13 AM, HaMb0 wrote:

    I feel that the article was well written, and presents it's case well. The "Happy Planet Index", however doesn't tell us anything. You may as well take the Calculated numerator and simply divide by relative GDP (or another measure of wealth).

    At its core, creating GDP and increasing money has one singular purpose: to allow you to consume more. Since the Happy Planet Index simply divides your happy numerator by consumption, it is in effect simply penalizing countries that produce things, and rewarding those with low GDP. Why does this matter? If demand for goods outpaces supply, prices will rise, and consumption will reduce. Why are countries penalized for consumption? It's a random factor that I don't think adds any value to the result. What is the number really telling us that we didn't already know?

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