I always have considered myself a glass half-full type of person, a person who does not accept the status quo or simply think outside the box, but, rather, I tend to create my own box. Lately, I have begun to ponder what external forces exist in 2016 that have enabled me to be so optimistic about our collective futures.
Let’s start with the average standard of living: it is higher now than it ever has been at any point, not just in the United States, but globally. The world is experiencing human development at unprecedented levels, as the Human Development Index has risen in every country except Swaziland between 1990 and 2014.
The Human Development Index (the “HDI”) was developed by Pakistani economist Mahbub ul Haq in 1990 “to shift the focus of development economics from national income accounting to people-centered policies” and to better depict the richness of human life rather than the richness of the economies in which they live. The index comprises life expectancy and education indices including expected/mean years of schooling, in addition to a standard of living index (gross national income [GNI] per capita). Now widely adopted, the United Nations releases the HDI for each country annually.
In the UN’s latest report (which features interactive activities; click here to see the graph), the United States ranked 8th in the world with an HDI of 0.915 behind (1) Norway, (2) Australia, (3) Switzerland, (4), Denmark, (5) Netherlands, (6), Germany, and (7) Ireland. The United States boasts a life expectancy of 79.1 years, a mean 12.9 years of schooling, and a $52,947 gross national income per capita. The United States also ranks highly in other socioeconomic progress indices such as the Index of Economic Freedom (published annually by the Wall Street Journal – in which the United States ranks 11th), and the Social Progress Index (which measures the social and environmental impact of human actions) in which the United States ranks 16th.
I do have concerns that, although the United States metrics have been robust, more recently we continue to lag behind other well-developed nations in many areas. It’s for this reason I believe the U.S. needs to more heavily invest in education and infrastructure. Although we have a growing economy and expanding business within our borders, without a properly educated talent pool to meet the needs of the jobs of the future, I fear businesses will move jobs and their related innovations to other countries who can more readily provide the skilled workforces necessary to meet the demands of the future.
Similarly, as our national infrastructure continues to decay our deferred maintenance liability continues to grow. Former Harvard School economics Professor and undersecretary for international affairs of the United States Department of the Treasury stated; “Future generations will be better off owing lots of money in long term bonds at low rates in currency they can print, than they would be in inheriting a vast deferred maintenance liability.” It’s going to take a lot of money to maintain the awesome infrastructure we have built so we best start planning for these maintenance requirements now.
Worldwide socioeconomic progress has occurred despite historical setbacks to countries such as Vietnam (i.e. the Vietnam War). Swedish doctor and statistician, Hans Rosling, at the Karolinska Institute in Stockholm compares the relationship between fertility rates and life expectancies for both the United States and Vietnam in his TEDTalk in which he uses his software, GapMinder, to illustrate each country’s progress. Click here to see the video.
Despite the deaths incurred by both countries during the war, both countries managed to increase their life expectancies between 1960 and 2010. Vietnam achieved this by implementing “family planning” measures that limited families to two children. Many East Asian countries, most notably China, have followed suit, reforming social norms to emphasize economic progress and education. In fact, substantially all of the world’s countries have increased their life expectancies and reduced their fertility rates since 1960. A graph of current health and income trends has been published on the GapMinder website.
Worldwide, socioeconomic advancement has also been aided by the “fourth industrial revolution,” which comprises the advent of new technologies such as the mobile phone and the Internet. Since 1995, the use of both has skyrocketed to 7.1 billion mobile phone subscriptions and 3.2 billion Internet users as of the end of 2015. This has resulted in rising productivity, new jobs, better services, and a more globalized economy.
Furthermore, cloud technology has also transformed business by blurring the distinction between work and leisure while allowing people to find more meaningful, flexible work (see Chapter 3 of the 2015 Human Development Index Report). It is easier than ever to start a business and find meaning in one’s work.
As our world continues to grow ever smaller, through 24/7 media reporting and Internet communication devices, our ability to accelerate innovation is ever apparent. It is important as we continue on our rapid innovation curve that we be mindful to not leave others that are less fortunate, and lack the access to this technological revolution behind. A widening gap between the privileged and others worldwide could become so wide as to cause tremendous economic and social strife. This could be a root cause of the seemingly endless stories of terrorism pervasive throughout the world today.
Although it would seem this disparity could simply be handled through government subsidies and welfare, my belief is the best solution is massive investment in education. In conclusion, I feel fortunate to be living in 2016 in the United States of America with our unlimited economic opportunities, access to world-class healthcare, freedom of expression and, of course, the right to vote!
2015 Human Development Index Report: http://report.hdr.undp.org/
Hans Rosling TEDTalk: https://www.youtube.com/watch?v=hVimVzgtD6w&spfreload=10
GapMinder Health & Income of Nations: http://www.gapminder.org/GapminderMedia/wp-uploads/gapminder_world_2013_v8.pdf
Scott N. Beck, a Dallas Texas Greenhill alumni, received a Masters of Accounting from the McCombs School of Business at the University of Texas at Austin where he completed his B.B.A. Mr. Beck is a member of the Board of Directors of United Texas Bank and is President of Beck Ventures.