The United States is now less economically prosperous than China, Thailand, New Zealand and South Korea, ranking 24th overall in the world.
The ranking is part of the Prosperity Index, which is produced by the Legatum Institute, a think tank arm of the investment firm Legatum Group based in Dubai. The index measures 142 countries based on a number of criteria, including health, education and economic prosperity.
Norway ranked first for its economy, followed in the Top 5 by Switzerland, Singapore, Canada and Japan. China was ranked seventh. The US ranked in the Top 20 last year.
Nathan Gamester, program director for The Prosperity Index, told U.S. News and World Report that the economic index was designed to “measure prosperity very broadly.” Generally, people “measure countries’ success based on GDP or narrow economic measures.” That is not how the report measures prosperity.
“Our attempt here is to quantify potential prosperity or multidimensional prosperity,” he said.
The index does not use standard metrics like GDP, GDP per capita and poverty rates. Among the items it does measure are per-capita GDP growth and how many people say they have access to sufficient food and shelter, as well as how many people are satisfied with their living standards.
For example, 72.4 percent of Americans report that they are satisfied with their living conditions, while 74.5 percent of Chinese like how they live.
The news website reported on several parts of the index that may account for America’s lower ranking, one of which is savings. Gross savings in the U.S. is about half the global average of 20.1 percent of GDP, coming in at 11.1 percent. This contrasts with Norway, which has a rate of 38.3 percent. China stands at 52.5 percent, while Kuwait comes in at 62.6 percent.
Americans also rank low in a metric that measures trust in financial institutions. Only 37.5 percent of Americans say they have “confidence in financial institutions.” This compares to the global average of 59.5, the Malaysian rate of 91 percent, and Norway’s 80 percent.
In addition, the U.S. lags behind other countries in terms of unemployment. As of 2011 – the baseline for the rankings — the unemployment rate in the United States was 8.9 percent, and a paltry 29.1 percent of Americans said it was a good time to find a job. By contrast, Canada (which ranked fourth in economic prosperity) had an unemployment rate of 7.4 percent, and nearly half (46 percent) of Canadians said it was a good time to find work.
As Off The Grid News reported, America’s debt passed $17 trillion this year.
While the US barely makes the top 25 in the economic prosperity section of Legatum’s report, it does better in the overall Prosperity Index (coming in at No. 11), which measures other factors such as security, personal freedom and education.
The report ranked the United States second in health and fifth in education, its lower economic prosperity index pulled down its overall ranking.
While last year’s report had dire warnings, this year’s report calls U.S. economic performance “encouraging” and looking “healthier than it has in the past,” The Post said.