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Income inequality pushes U.S. down in well-being ranking

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KAI RYSSDAL: We report with some regularity on the most-watched indicator of overall economic health in this country — gross domestic product. But the sum total of everything tangible that an economy produces isn’t necessarily the be-all and end-all measurement of economic health.

Today the United Nations released its latest Human Development Index. It tracks well-being across the globe and the United States is getting a demotion.

Our special correspondent David Brancaccio reports we’re getting dinged for economic inequality.

DAVID BRANCACCIO: It’s been 20 years since the U.N. used new statistics to acknowledge that there is more to well-being than just money. The U.N.’s Human Development Index looks at income in countries around the world, but it also looks at measures of health and education. On the very first of these rankings, back in 1980, America was number one. Today, U.N. officials revealed that the U.S. is number 4 for well-being behind Norway, Australia, and New Zealand. And for the first time, the rankings were also filtered for inequality, gaps between rich and poor.

Jeni Klugman, the director of the U.N.’s Human Development Report, explains what happens to the U.S. when this gap is factored in.

JENI KLUGMAN: Its overall Human Development Index falls by about 11 percent, which is quite significant. It’s much than, for example, Australia. When we adjust for other developed countries, the normal loss is much less.

With inequality’s considered, the U.S. ranking for well-being drops from 4th to 13th in the world.

Tamara Draut tracks U.S. income inequality at the liberal think-tank Demos. She sees the U.N. finding as part of a long arc.

TAMARA DRAUT: The middle class has lost ground and lower income households have just been clobbered. That is the story of the last couple of decades.

America’s rank in the Human Development Index was, on the other hand, helped by its record on education, since the index rewards countries where people spend the most years in school.

In New York, I’m David Brancaccio for Marketplace.

Ryssdal: More of David’s coverage and our series Economy 4.0 on our website, it tracks a whole set of alternative indicators like the Human Development Index.

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