You are here

Human Security Index

The Human Security Index has now been developed for the United States down the county level in 3143 counties (or county equivalents).  The Human Security Index is now developed for 232 countries. 

What does it mean for the U.S. to be #220 out of 232 n economic fiscal governance?  Is #1 the best or the worst in this case?  On the surface, it would appear that the US is one of the worst countries in the world in terms of economic vulnerability.  Is that correct?  If so, why would the U.S. be more in the league of Zimbabwe, Haiti, and Somalia, than in the group of the best (e.g., Norway, Singapore)?

The rankings range from #1 (best) to #232 (worst).  #232 is Zimbabwe.  #1 is a tie among several countries.  Influences on the indicator include trade balance, current account balance, currency stability (exchange rate gains or slippage), and financial strengths/vulnerabilities of individuals resulting from health care finance/access in a country.  At this point, that is a prototype indicator - needing additional work to improve its on-target representation.  But a country with high GDP per capita, with low economic-fiscal governance, may not be in a sustainable mode.  The USA's foreign trade was relatively in balance up to about 1970 (note the timing with peak oil in the USA).  In the 1950s, it has been claimed, the US had to watch its balance of trade, to ensure that it did not get "too greatly positive, for too long".  That is no longer the case.  And, several countries which maintain large positive trade balances (e.g. Gulf states, several east Asian states), are not acting as classic mercantilist states - but are investing more internally, consistent with strategic plans for national competitiveness.

One thing missing from the draft indicator on Economic and Fiscal Governance, is on development and effectiveness of national competitiveness strategies.   I would love to see such an indicator developed.  (An expert group could do so..)  Some countries develop these, in partial partnership with peers in various blocs (e.g. the EU and ASEAN).  Where is the USA's competitiveness policy?  How is such a policy developed?  How much crowdsourcing might there be in such a policy?  How much national buy-in may there be?  If the USA has such a policy, is it effective?  Is it systematic (in a way that we could admire)?  I won't offer my draft thinking on that issue.  But I'm curious about what others may think.

Hmmm, I tried replying earlier - but don't see the reply posted.

#1 is best.  The USA is in bad shape, according to the data.  Think Eurozone laggards without the EU to help solve problems.  In the 2008 minor melt-down of the dollar, even developing countries like Thailand were buying dollars to keep us from sinking farther, and thus being less able to buy Thai exports.  So developing countries were foregoing their own internal investment - thinking that it was more important to prop us up.

But what when that changes, and countries need us less as a market?  Will we be cut adrift?

The US$ has fallen over 75% against the DM-Euro, Swiss Franc, and Yen.  It has fallen almost 70% against the Singapore Dollar.  The Canadian and Australian dollars collapsed in the 1970s-1980s, but have now pulled up again at par with the US$.  Because of good moves on their part, or bad circumstances of ours?  Your call, but I'd place my bets on both, with more weight toward our slippage.

I think the biggest problem is lingering trade and current account deficit.  We can't live within our means.  We're not tightening our belt on energy imports.  Neither are we finding stuff to export that folks overseas want to buy. Our labor force is dropping.  Our underemployment rate is high. Real unemployment rate is ~23% (http://www.shadowstats.com/alternate_data/unemployment-charts). We lack a competitiveness strategy (let alone one that is developed in public dialogue for better buy-in by the people).

Related to all of this seems to be the USA's increased go-it-alone-ness over the past few decades.  We partner with others less.  We learn from them less.  We're getting dumber by global norms.

Indians and Chinese can come here to our universities, learn what we know in addition to what they know, and be better competitors here or back home (to some degree, their choice).

These are various flavors of our problems, and why I think we're not doing well.

Now - is that indicator accurate?  When HSI v2 was being readied 2 years ago, I was surprised that the USA was as low as #147 out of 232 countries.  I was surprised that our economic governance is THAT bad.  But those are the numbers.  Some of the numbers may be imperfect.  I hope to get a better indicator crafted, with better data, for version 3 later this year.  So some of the problems may be due to the data.

But there's no question.  We are shooting ourselves in the foot.  Disinvesting.  De-capitalizing ourselves.  It has been haunting us since about the time of the "Nixon Shock".

Dave.

howdy folks