USA: investing in human infrastructure

The USA’s rank on the Happy Planet Index in 2019: #122. Explore the data.

By: Natalie Meltzer

Despite having one of the highest GDPs per capita in the world, the United States lags behind the vast majority of countries included in the Happy Planet Index—ranking #122 out of 152 countries. The country’s poor performance on the Happy Planet Index (HPI) is largely driven by its outsized ecological footprint. There are many steps that need to be taken to address this issue, including greening our energy grid, retrofitting buildings, and investing in public transportation.

Alongside ecological footprint, it is also important to examine factors that underlie the country’s average self-reported wellbeing.

The link between childcare and wellbeing

One way to do this is to examine how the country fares in comparison with other highly industrialised countries. In 2019, the US fell below 20 other high-income countries on the Ladder of Life (the wellbeing measure), including Australia, Denmark, Germany, Sweden, Ireland, the United Kingdom, Canada, and Costa Rica. 

One characteristic shared by these countries is higher levels of public spending on childcare. Among industrialised nations, the US stands out for its paltry investment in early childhood care. The country spends 0.2% of its GDP on childcare for children 2 and under, compared with an average of 0.7% of GDP in Organization for Economic Cooperation and Development (OECD) member countries.

(That’s 3.5 times less, as a percentage of GDP.)

It is likely not a coincidence that the countries with higher Ladder of Life scores than the US also invest more in childcare. These other high-income countries recognize the manifold impact early childhood education and care have on wellbeing. Research suggests that early childhood care improves individuals’ long-term health, educational attainment, and economic outcomes—and most likely increases self-reported wellbeing, which largely correlates to income. 

Analyzing the United States’ HPI score through the lens of childcare raises important questions about the factors which contribute to self-reported wellbeing in the US.

Families in the US spend an average of $13,000 for basic childcare each year.

This spending boosts our GDP, but masks the system’s impact on individual wellbeing.

The high price of childcare in the US is out of reach for many families, forcing them to make difficult tradeoffs and driving many working parents—particularly mothers—to increase their working hours or leave the workforce entirely. And despite the high costs of childcare, workers in the industry are largely paid poverty wages, undermining their wellbeing. All of this worsens inequality—a major issue in the US that has negative impacts on health and wellbeing.

Investing in “human infrastructure”

The US has a fleeting opportunity to invest in childcare this year. President Biden’s “human infrastructure” agenda includes $90 million to help families with children under the age of 5 pay for childcare, as well as funding for universal pre-K and a new Child Care Wage grant program that would improve wages for childcare workers. 

Some policymakers argue that including home care in the bill stretches the definition of infrastructure.

But care work is just as central to the functioning of our economy as roads and bridges.

Americans understand this. Multiple polls indicate that a majority of Americans believe care is part of the country’s infrastructure. As put by the Chair of the Council of Economic Advisers, Cecilia Rouse, 

“I can’t go to work, if I don’t have someone who’s taking care of my parents or my children.” 

Investments in this critical work could improve self-reported wellbeing for parents, childcare workers, and the children served.

Growing investment in areas of the economy that contribute to wellbeing, like childcare, should come alongside shrinking investment in other areas of the economy that damage wellbeing—and drive the USA’s high ecological footprint, such as defense and mining. Together, these policies could improve our country’s Happy Planet Index score.

About the Author

Natalie Meltzer is a MPP Candidate at Duke University’s Sanford School of Public Policy. She is a member of the Revaluing Care in the Global Economy research team. You can connect with Natalie on LinkedIn.