The U.S. is one of the richest countries in the world per capita, ranking 5th out of 133, yet according to the 2016 Social Progress Index, America ranks only 19th in terms of converting that economic success into improvements for its citizens.
This is similar to a professional sports team possessing a great win/loss record, highly paid executives and great attendance but having disgruntled fans and players. Why are the players and the fans so upset? To better understand this we must fully understand what exactly the Social Progress Index measures.
The Social Progress Index measures progress based on these three categories.
Basic Human Needs:
- Nutrition and basic medical care
- Water and sanitation
- Personal safety
Foundations of Wellbeing:
- Access to basic knowledge
- Access to information and communication
- Health and wellness
- Environmental quality
- Personal rights
- Personal freedom and choice
- Tolerance and inclusion
- Access to advanced education
As far as providing access to advanced education and shelter the U.S. is performing exceptionally well. Unfortunately, it performs poorly in several other categories such as health and wellness, access to basic knowledge, personal safety and nutrition & basic medical care. Additionally, wage growth, a measurement not calculated by the Social Progress Index, has been stagnant. Research by Indeed showed that only fifteen percent of workers were in jobs that see consistent wage growth keeping pace with inflation. Of these jobs, 50% were located in just nine states. Furthermore, training that would allow these growth jobs to be filled by U.S. workers is not readily available. Even worse, the situation isn’t improving. Last year the U.S. ranked 16th in Social Progress, slipping three spots to now sit just ahead of Slovenia.
Here we see that, despite companies getting richer and the economy strengthening, many of the opportunities and benefits Americans expect to enjoy as a result are not trickling down to them. The team is making plenty of money but the fans are overweight, out of breath, are getting mugged in the parking lot, can’t access WiFi on their phones and the players have seen little wage growth despite their exceptional win/loss record.
Honestly, aside from stagnant wage growth and the obesity epidemic, I didn’t feel we Americans were doing so poorly. Now it seems I and everyone else should be up in arms! Especially when considering that countries such as Costa Rica and Nepal over perform on Social Progress despite their low GDPs.
So what can we do about it? Just getting angry and acting out won’t get us anywhere. The first step is to identify our problems and then explore the solutions that are working elsewhere to see which ones might apply here in the USA. Only with focus and positive action can America begin to turn things around and address the issues so incensing us today.
I stumbled onto a startling statistic recently by the Economic Policy Institute in regards to the CEO to worker compensation ratio. According to their report the CEO to worker pay ratio in 1965 was 20-1. So if in 1965 I earned an average salary of say $4,600 a year, close to the average salary at the time, than my CEO likely earned $92,000 that year on average. One might complain about such a disparity but perhaps the salary is justified considering that the CEO presumably worked very hard at a very good school and hopefully is responsible for much of my company’s success. Perhaps they would have deserved to make 20 times my salary. Continue reading “Corporate Greed Stifles the Economy and Fuels A Coming Storm” »