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Author: John Watson
Source: The Age
Date: 13 November, 2013

Most of us wish friends and family, especially our children, one thing above all else: happiness. So why do we prioritise other goals – wealth and careers, economic growth and incomes – above such a fundamental aspiration? Why do we, as individuals and a nation, not do the things proven to increase happiness?

We rarely think of happiness in national terms, but it was not always so. The US Declaration of Independence, adopted on July 4, 1776, famously declares the ”unalienable Rights” of citizens of the new nation are ”Life, Liberty and the Pursuit of Happiness”.

The declaration also insists government serves the pursuit of happiness: ”It is the Right of the People … to institute new Government, laying its foundation on such principles and organising its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.”

In the subsequent 237 years, many nations have moved away from the profound good sense of using happiness as their compass. ”Growing the economy” and lifting incomes and consumption have become ends in themselves.

Happiness is thought to be just another trickle-down effect of material gains. Populist election pitches take it as given that lower taxes and smaller government make people happy.

This is demonstrably wrong. In recent years, researchers have learnt much about what makes people happy. The World Happiness Report 2013 identifies six key factors that explain three-quarters of the variation in happiness among the 156 countries it ranks.

Economic growth and incomes are a key factor, of course – the unhappiest nations tend to suffer the worst poverty – but there’s much more to happy, fulfilled lives than that. The happiest nations are wealthy, but not all wealthy nations are happy. The top 10 are Denmark, Norway, Switzerland, the Netherlands, Sweden, Canada, Finland, Austria, Iceland and Australia at 10, which is the least one would expect of the lucky country.

But once a person has reasonable financial security, more money does not buy more happiness. A 12-year Australian study found once gross household income reaches $100,000 a year – the national average – any extra income really doesn’t increase happiness. Wanting more and more stuff, while jealously guarding what we already have, in fact makes it harder to be happy.

Australians should focus more on other factors: mental and physical health; having someone to count on in times of trouble; perceptions of corruption; prevalence of generosity; and freedom to make life choices. We fare well on GDP and corruption (whatever the Clive Palmers of this world may say), but could do better in other areas. Let’s be clear, that’s not an anti-economic argument: happy people are healthier and more productive.

This is where the links between generous, supportive communities, good policy and, dare I say it, higher tax revenue come in. The 10 happiest countries include five of the 10 highest taxers and have an average rate of 40 per cent of GDP. Their people seem happy with tax rates up to 50 per cent higher as long as they see the public benefits.

High taxes are neither essential nor guarantee happiness – Zimbabwe has the highest taxes – but many policies shown to improve happiness do require money.

One exception may be developing a culture of generosity, which has suffered from the adoption of an economic model of competition as a personal credo of aspiration. Government can inspire or discourage a more generous spirit towards others, but that’s really one for us all to work on.

Policy does have a huge bearing on the other factors. The report has a chapter written by a former UK cabinet secretary and head of the public service, Gus O’Donnell, who focuses on health, education and transport. The policy choices range from the simple – green space and the presence of trees – are ”key drivers of wellbeing” – to the complex such as redesigning transport, education and health systems with wellbeing as the prime objective.

One policy stands out above all others: ensuring treatment is as available for mental illness as it is for physical illness. ”Mental illness is the single most important cause of unhappiness, but is largely ignored by policy makers,” the report states. In Australia, too, the gulf between mental health needs and services is vast and cannot be closed within current budgets.

Having someone to count on makes for strong communities. The happy Scandinavians and Dutch adopted policies that foster closer communities. Co-housing models, or ”intentional communities”, go back 50 years to Danish architect Jan Gudmand-Hoyer’s quest for a ”more supportive living environment”. Today, 10 per cent of all new-built property in Denmark is co-housing, a mix of private homes and communal facilities.

Co-housing provides care for children and the elderly, who are not rushed off to childcare or old-age homes. There is great value in knowing that if you need anything – from a light bulb to a chat to having someone keep an eye on the kids – you can rely on your neighbours. Helping out and giving to others are huge sources of happiness, and good policy helps enable this.

That leaves freedom to make life choices – in a word, opportunity. The key is education. Australians do not have equal access to excellent education and never will have unless government invests more in public schools and teaching. Again, there is a clear correlation between the happiest nations and strong public education.

Seen through modern politics’ narrow prism, it may seem radical to make happiness a guiding policy objective, especially if that leads to higher taxes. But growing dissatisfaction with how poorly government serves people demands change. The report co-author Jeffrey Sachs is right in saying: ”There is now a rising worldwide demand that policy be more closely aligned with what really matters to people as they themselves characterise their wellbeing.”

As America’s founders knew, the pursuit of happiness matters. At some stage in our materialistic rat race, we inexplicably forgot that.

We’ve been so good at pursuing incomes and growth that we do it for its own sake, without considering the non-material quality of our lives. And that is terribly sad.

John Watson is a senior writer at The Age

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