The old adage says money can’t buy happiness. Even the Beatles knew it can’t buy you love. But let’s be honest: It doesn’t hurt to have a few bucks in the bank, either. No one wants to be poor, and it’s pretty tough to buy groceries, pay down your mortgage or afford gifts with nothing more than holiday cheer.

And since the U.S. is pretty wealthy compared to other nations, it should come as no surprise that we’re some of the most satisfied people in the world. But is that the whole story? What about countries with lower Gross Domestic Product (GDP) per capita than the US, whose residents are just as satisfied as we are (Venezuela), if not more so (Finland and Denmark)?

While a steady income is certainly important, money itself is not an end. It’s a means to an end. And the ends that we’re seeking are more than likely attaining happiness, opportunity, and security for ourselves and our family.

And yet, for a variety of reasons, we easily slip into the trap of equating how much money we exchange (and note, that’s not how much money we actually have) with social well-being. One of the main reasons we combine these two disparate concepts is a lack of a number to conceptualize our well-being. That is, we all know, right down to the dime, how much money we have in the bank. But what’s the current balance of our happiness?

The Genuine Progress Indicator (GPI) takes the first step towards addressing this need, but it will always fall short of answering some very important questions about our social well-being. Sure, it quantifies elements of our economy, environment, and society – all things that can have a tremendous impact on our happiness. But don’t be mistaken; the GPI was never designed to gauge our well-being. It certainly provides a more robust perspective than the GDP, but it is still fundamentally grounded in economics.

So, how do we measure peoples’ happiness? Well, that’s actually quite easy: Ask them! Each day, various polls are conducted in which thousands of Americans are asked point blank to sum up their happiness and life satisfaction. Then those indicators are combined to calculate our general state of happiness. If you want to learn more, a great place to start is the US Gross National Happiness and the Gallup Healthways Well-Being Index. Also, here is an excellent op-ed piece from the New York Times.

To be fair, there are several ways to interpret the data and information. The concept of happiness and subjective well-being is fascinating and well worth your time. To get you started, here is a very brief op-ed from the Economist, and this link and this link are accessible academic papers.

Now, back to the MD-GPI. A common question asked of me – and the catalyst to this blog – is how happiness and well-being track alongside the GPI and/or Gross Domestic Product. For the United States, the following graphs provide a glimpse into that question. As you can see, while the GDP per capita continues to rise, both the GPI and the General Level of Happiness somewhat flat line.

Looking at trends for Maryland is a bit more challenging as data collection only began back in 2008. The upshot, though, is that this information is far more detailed and telling. The data below comes from Gallup Healthways polling and the Brookings Institution.

When looking at the graphs, a key note to understand is that rather than focusing on how high or low our well-being is, it is more important to look for consistency. That is, high peaks and low valleys are not a good thing. If you’re constantly worried, each day will be a roller-coaster. But individuals in a steady community are continuously secure in their health, safety, schools, and jobs.

So when you look at Maryland (in red), we are doing quite well in comparison to our neighboring states. Further, not only are we at the top, our data line is far flatter, meaning we enjoy a more consistent state of life satisfaction. In comparison, note the volatile, zig-zag line of Washington, DC.

In broader terms, Gallup Healthways releases a yearly assessment of each state’s Well-Being. Maryland’s report can be downloaded here, and the graph below provides the overview. As you can see, in 2010 Maryland ranked 13th in the nation in overall well-being, and #3 specifically with Life Evaluation. None of our bordering states even cracked the top 20.

Pulling together and comparing Maryland’s Gross State Product, Genuine Progress Indicator, and Well-Being still doesn’t quite answer all our questions, but it does provide some insight. For example – it’s clear that our GPI and Well-Being are not currently keeping pace with our economic activity, but it does indicate generally positive trends. Plus, Maryland continues to enjoy relatively good economic, environmental, and social conditions and improvement.

In future blogs, we will further explore the connection between all these elements…so please provide your comments, questions, and suggestions below!

(Many thanks go to Tom Barefoot at US GNH and Carol Graham and Soumya Chattopadhyay at the Brookings Institution for their assistance in this blog.)

Sean McGuire, Maryland DNR