US Leads Rich World in 'Paradox of Unhappy Growth,' Brookings Finds

Trust in the US government fell 31 percentage points between 2006 and 2024, and trust in the courts dropped another 24. Those numbers anchor a new Brookings paper that names the United States the most extreme case of what its authors call "the paradox of unhappy growth" — a country whose economy keeps expanding while its people feel worse.

The paper's lead author, Carol Graham, built her career measuring happiness. Now she measures the opposite. "I used to work on happiness and I seem to work more on despair now," she told Fortune. "So that's not great, but that's the state we're in."

Graham is a senior fellow in economic studies at the Brookings Institution, a professor at the University of Maryland's School of Public Policy, and a senior scientist at Gallup, whose World Poll supplied the data. Her co-authors are Douglas Harris, Anjana Nair and Isabel Shaheen O'Malley. Brookings summarized the paper on Oct. 1. The team used Gallup data from 44 middle- and high-income countries covering 2006 through 2024.

What do the numbers show?

Three US indicators moved sharply over the 18-year window: trust in government (-31 points), trust in the courts (-24 points), and the share of Americans who feel free to choose how to live (-19 points). The authors found the US converts income growth into well-being less efficiently than the average country in the sample.

By 2024, only 12% of Democrats and 52% of Republicans said they were satisfied with the country's system of government. The paper calls the US the most polarized democracy in the developed world.

Graham's reading of the data starts in her birthplace. "I was born in Peru and I worked initially on development economics," she said. "And I can tell you what real poverty is." That background shapes her central claim: "Poor people in Latin America are much more hopeful than poor people in the U.S. And I've concluded that it's harder to be poor in a very rich country where you're sort of stigmatized. And plus the American Dream narrative sort of stigmatizes you."

She traced the pattern first in China. In research with Shaojie Zhou and Junyi Zhang, published in World Development in 2017, she found life satisfaction dropped "precipitously" during the early stages of China's rapid growth — on a par with the Great Recession or the COVID pandemic. "They were the fastest-growing country in the world and suicides were skyrocketing," she said. The suicide rate fell once the most dramatic phase of China's market transition ended. The researchers called it a "paradox of progress."

The American version is slower. The US has outgrown nearly every other wealthy country for two decades, Graham said, but inequality has kept "gradually creeping" upward "to the point that it's corrosive."

Why does the American Dream make it worse?

In her 2017 book Happiness for All? Unequal Hopes and Lives in Pursuit of the American Dream, Graham argued the national narrative turns falling behind into a personal failing. "So if you fall behind and you're poor, it's your fault because you didn't work hard to get ahead," she said. "Nobody ever talks about bad luck."

She points to Horatio Alger's Ragged Dick, the founding myth of self-making, in which a shoeshine boy rises after saving a rich man's son from drowning. "Even the old famous Horatio Alger story, he had a benefactor," Graham said, "and they never talk about that when they tell the story."

The Brookings paper blames the happiness decline partly on "a deeply rooted culture of individualism and distrust of social support." The US has a "thinner social contract" than its peers, the authors write.

Hope itself has measurable value. In a study published this year with Redzo Mujcic of Warwick Business School, Graham followed 25,000 Australian adults for 14 years. Those with high hope levels had better outcomes in health, education and employment — and recovered faster from negative life events.

Who does the data miss?

Prime-age men who left the labor force barely show up in standard statistics, Graham said. In a 2021 paper with Sergio Pinto, she found these men were "very unhappy and very pessimistic" and "disproportionately represented among opioid users." Many "still live in their parents' basements or in the parents' census tract," she said.

"The macroeconomists go on and on and on about how strong the labor market is," Graham said, while for many Americans "their lives are so far from what the numbers are telling." She links rising populism, at home and abroad, to that gap.

What about the counterargument?

Philipp Carlsson-Szlezak, global chief economist at Boston Consulting Group, argued in a September report, "The Kids Are Alright," that since 2020 wage growth for the bottom quartile has outpaced the top in nearly every year. "Nothing is ever monocausal, but the biggest challenge is that of distorted expectations, in my view," he told Fortune. Retired University of Chicago economist Sam Peltzman found the 2020 crash in happiness hit hardest among the most educated and wealthy — though Graham notes the General Social Survey offers only three answer choices, while Gallup uses a 0-to-10 scale.

On that Gallup scale, America is pulling apart: the share rating their lives 7 to 10 barely moved while the average fell more steeply. "Our narrative and our numbers," Graham said, "are really out of touch with how people are living right now." For policymakers and employers reading the same rosy macro data, that gap is the signal worth watching.