Wednesday, July 18, 2018

If We're So Rich, How Come We're Not Happy?

     We are better off in almost every way than at any time in history. Yet to read the headlines -- even to talk to your friends -- you'd think the world is coming to an end.

     Jeremy Kisner, an investment adviser with Surevest Wealth Management of Phoenix, AZ, recently addressed this phenomenon, and, I think, put the world in better perspective. I am summarizing (another word for stealing . . . but with his permission) his thunder here, but for more wisdom direct from him, you can go to jeremykisner.com.

     Kisner reminds us that the world has improved dramatically over almost any time frame you can consider. But it doesn't always feel this way because negative headlines attract eyeballs and sell advertising. Granted, there are tons of very real problems. Nevertheless, Bill Gates nailed it when he said, "Headlines are what mislead you, because bad news is a headline and gradual improvement is not."

     Human progress occurs because every day a few billion people go to work and figure out ways to improve living standards. Individuals do not always recognize the gradual improvements. But one place you can see the progress is in the stock market which has been going up for most of our lives (with, granted, a few bumps in the road) and is near all-time highs.

     People get scared reading the news -- North Korea, Iran, Donald Trump, Vladimir Putin, refugees, economic disparities, global warming -- and then they get even more scared thinking about the things that might go wrong. But meanwhile, people buy more things, companies grow, wealth is created, and billions of people live longer and better lives.

     Here are a few of Kisner's examples of human progress,:

     Life expectancy: Consider this: If you were born in 1900, you would have had a 23% chance of dying before age 20 and a 38% chance of dying before age 45. Kids born today have about a 1% chance of dying before age 20 and a 4% chance of dying before age 45.

     Modern Conveniences: When our grandparents were born, virtually no one had electricity ... or telephone or indoor plumbing. They didn't have a car and couldn't fly in an airplane. Today, 85% of the people in the world enjoy the benefits of electricity. And two-thirds have a cellphone.

     Poverty: Twenty years ago 29% of the world population lived in extreme poverty. Today it's only 9% . . . and the rate is still falling.

     Crime: Violent crime has been on a downward trend in the U. S. since 1990. Almost 14.5 million crimes were reported in the United States in 1990. By 2016 that figure was under 9.5 million.

     Retirement: Some 90% of 65-year-old American men who were still alive in 1870 were working. Today only about 20% of 65-year-old American men are still working ... and many of them are working by choice not necessity.

     Housework: The average family spent 11.5 hours a week doing laundry in 1920. That has fallen to 1.5 hours a week as of 2014.

     Safety: Americans became 95% less likely to be killed on the job over the last hundred years. Seat belts, air bags and other safety features have brought down auto fatalities from 50,000 a year in the 1970s to about 37,000 today, despite more cars on the road. The auto fatality rate per 100,000 people has dropped from 25 to 11 -- less than half what it was in the 1970s.

     Disease: In the past century, vaccines and antibiotics have brought miracles for modern medicine. Just since 1990, the control of infectious disease has saved the lives of an estimated 100 million children.

     Food. Between 1961 and  2009, the amount of land used to grow food increased by 12%, but the amount of food grown has increased by 300%.

     Kisner maintains that people who think the best days for America, and for our economy, are behind us are essentially saying that human innovation is going to slow down or stagnate. He says that doesn't seem likely, at least over the next 20 to 30 years. Don't you agree?

     But that begs the question: With all this good fortune, why is everyone so disconsolate?

     We live in a society with the freedom to make our own decisions -- and our fundamental belief is that freedom to choose makes people happy. The more affluent we become, the more choices we have and, in theory, the happier we should be. The problem is that the average American in less satisfied with their lives, and clinical depression has exploded in the past 30 years, while our economy and standard of living has grown.

     Why? Kisner points us to the paradox of plenty. Now, there's no question, there are some benefits to more freedom of choice. But there are negative effects as well.

     Paralysis. The more options we have, the more difficult it is to choose, and we end up procrastinating, or just freezing up. For example, an analysis of over 600 corporate retirement plans showed that the more mutual fund choices a company offered in its 401k, the fewer people participated in the plan. This is because the task of selecting the right funds became overwhelming. There's more choice, but people actually end up poorer.

     Second guessing. The more options we have, the less likely we are to end up satisfied with our choice. For example, assume there are three salad dressings. You know you don't like bleu cheese or honey mustard, so you pick Italian, and you're happy. What if there are 24 salad dressings? You are likely to be filled with doubt that you picked the best one, regardless of which one you pick.

     Escalation of expectations. With all our options, we expect to find the "perfect" choice. When our choice is less than perfect, we are less satisfied. And then, instead of blaming someone else for the shortfall -- the producer, the provider, whoever -- we blame ourselves, because we somehow failed to make the right choice.

     For more on this paradox, you can go to a TED Talk by Barry Schwartz, who explains the theory further. But the bottom line is this: Material affluence enables more choice, but it frequently makes people less happy.

     This doesn't mean we should all take a vow of poverty. It means that we will all be better off if we keep the following in mind: Most of us are better off than we think. But less can be more. Don't be paralyzed by the pressure to make perfect decisions. Don't blame yourself when the solution you choose is not perfect. Don't feel bad if there's some "new thing" that you either don't want or can't afford. And share more with other people.

     As with most things in life, good can be good enough, and acceptance of that can lead to greater life satisfaction. And . . . don't pay too much attention to those negative headlines.

13 comments:

DJan said...

Interesting premise, Tom. I also think that our instant communication, knowing everything that the news throws at us every single day is one thing that keeps us unhappy. I know I am much happier when I don't watch it or check my phone constantly. :-)

Wisewebwoman said...

Well I'm not rich but I'm well satisfied with far less. I've unplugged from most media for a while and I'm finding I'm shrugging at the Twitter headlines. Didn't even delve deeper into Trump poodling to Putin. Why such shock and awe?

This new lifestyle is doing me a power of good. Though we truly can't minimize climate change.

XO
WWW

DUTA said...

We cannot control climate ans natural disasters, so no reason to feel happy.

Kathy @ SMART Living 365.com said...

Hi Tom! I agree. I know that there are some very major challenges facing our world and our country right now. But I believe that it would be a big mistake not to recognize that there are thousands of people around the globe working to make the world a better place. Those people seldom get noticed in the news but I deeply believe they are out there, doing their part. Do we all need to do what we can? Yes, but one of the biggest things we can do is to keep encouraging each other rather than scaring each other to death. Sure, some people might be motivated by fear but I'm not. I need to know there is hope or why bother. Kisner (and you) remind me that there is hope. ~Kathy

Janette said...

After reading about my ancestors, I became pretty darn content.
Turn off the constant news and shopping.
Read a book. Play with a child
Be happy.

Salvador Ortega said...

If it would only be so simple...

Olga Hebert said...

I have heard about this -- too many choices just leads to chronic indecision and dissatisfaction over having made the wrong choice (there's something better I should have picked, oh no!) The happiest people I know are those who are content with what they have, even more -- grateful for what they have. There is something to it.

Madeline Kasian said...

I suspect this syndrome may be peculiar to America! I have not travled extensively in Europe or other countries but I read a lot and see that the values in some other countries are much less attached to materialism vs. family time,leisure time, etc.

Especially now, we are bombarded with what everyone else is doing. Most of my younger suburban neighbors are trying hard to keep up with the Jonses, Moms and Dads both work, 3 car sin driveway, kids on fast forward,being driven from activity to activity non stop..everyone does seem frazzled.

Very glad we learned early on to live beneath our means, able to retire early.Happy with less, but am blessed to have a good amt. of abundance.

Not sure how the American culture can back up on this-- you think everyone would remember 2008...???

Linda Myers said...

I've decided to spend less time being scared out of my wits by headlines. Today I checked two books out of the library - you can still do that! - and I intend to read them both in the next week.

Simpler. Happier.

gigi-hawaii said...

Spending time with compatible people is also very important to me.

Friko said...

I am coming to the same conclusions about headlines!

I have seen various articles on improvements over time in our conditions; I wonder why these authors are pointing out that ‘we’ve never had it so good’. So many of us are frightened; like I said in my post, it could well be because we are just not used to the trials and tribulations that previous generations considered to be a normal part of human life.

Rose said...

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