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Business Commentary United States’ dominant global position obscures serious struggles

Glen Hodgson is senior fellow at the Conference Board of Canada.

The Winter Olympics offer an entertaining, if imperfect, test of how countries compare to each other. Recent Winter Olympics have seen close competition among multiple countries in the medal count – Germany, the United States, Russia, Canada, and Norway have all taken their place at or near the top of the table.

In more tangible areas of national performance, there is a clear pecking order. The United States of America remains the undisputed global leader – current political turmoil aside.

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The United States is still the world's largest economy, it has by far the most powerful military, and its intelligence and security apparatus reach every corner of the globe. But in overall quality of life compared with its peers, the United States' relative performance ranges widely – it is solid in some respects, mediocre in others, comparatively bad in some important respects, and uneven across different parts of the country.

Like many Canadians, I grew up within an hour's drive of the border.

I had the pleasure of living in Washington for 3 1/2 years, have visited more than 40 states and most major cities, and have studied U.S. history, politics, and geography. To understand the United States in the age of Trump, impressions and anecdotes aren't enough; evaluation should be based on available hard evidence.

The Conference Board of Canada has done the required analysis. The How Canada Performs report card on socio-economic performance regularly assesses 16 larger and relatively wealthy Organization for Economic Co-operation and Development countries, plus Canadian provinces and territories, in six domains: economy, education, environment, health care, innovation and society.

It should come as no surprise that the United States has solid results in categories related to the economy. In our most recent analysis through 2016, the United States ranks sixth among countries on the economy.

It has taken the country a full decade to recover from the 2008-09 global financial crisis and recession. Continuing fiscal deficits and monetary stimulus have been key drivers of the recovery, and the Trump tax cuts will provide an additional, short-lived growth bump.

However, protectionist attitudes toward international trade, and specifically toward the North American free-trade agreement, could undermine the United States' growth performance in the months and years ahead.

The United States scores near the top on innovation, where it is fourth among peer countries – behind only Scandinavian countries Sweden, Finland, and Denmark. The United States has crafted a unique approach to innovation, combining entrepreneurship and business investment.

The country surpasses all peers on entrepreneurial ambition and venture capital investment, and performs very well on investment in information and communications technology and business R&D.

The long-term risk, however, is that the foundation of science and researcher education and training on which innovation rests is lagging.

Somewhat surprisingly for an innovation powerhouse, the United States is a poor performer on overall education and skills. In our most recent analysis, the United States is 15th out of 16 countries over all. The available data suggest the country has achieved success in providing wide access to education, but point to shortcomings in the overall quality of that education.

The United States ranks very high in terms of high-school and university attainment, but poorly in terms of high-level reading, math and science scores.

The United States' underperformance in education and skills extends to the society it has created for itself. The U.S. data demonstrate once again that a robust economy does not guarantee outstanding social outcomes.

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The country ranks dead last on indicators of societal equity and cohesion. It has the highest rate of poverty, the highest levels of income inequality and by far the greatest number of homicides in our comparison.

Similarly, the United States ranks last among comparator countries in population health measures included in the health analysis.

Access to health services was not included in the report card, but the United States remains alone among major OECD countries in not offering universal publicly funded health insurance, even as the U.S. spends by far the most money per person on health care among developed countries. There is a wide disparity within the United States on social and health outcomes.

The country joins Canada and Australia at the back of the pack on overall environmental performance. It joins China as the largest emitters of greenhouse gases, and Americans use the most water per person. On other indicators, such as GHG emissions, the United States as a whole ranks in the middle of the pack.

The overall results confirm a country that is an economic and military powerhouse.

But in creating a fair society that protects of the health and safety of its population, the United States is not going for gold.

Editor’s note: An earlier version of this column incorrectly stated that the U.S. and China are the largest per capita emitters of greenhouse gases. The countries are the largest emitters over all, but not on a per-capita basis.
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