Monday, January 16, 2006

Misery quantified

Italians have a great phrase to sum up their frustration with a person or situation: "Porca Miseria!", or "pig misery." It's a versatile little phrase, uttered by all and sundry. You can use it when a driver cuts you off or when your mobile reception konks out or when the only thing on TV is sing-along variety shows. (I originally surmised the phrase was used to summon the spirits to inflict intestinal, pork-inspired voodoo discomfort on your rival, but that explanation has long been discredited by modern Italians).

But the Italians, of course, do not have the market cornered on misery. In fact, that honor/horror goes to the Yanks. According to the latest Merrill Lynch study on "The Misery Index", now in its 30th year, Americans are the most miserable people of all G7 nations. More miserable than even the French!

According to the Economist:

The United States has the highest score (see chart), ie, it has the most wretched economy among the big G7 countries, thanks to its huge deficits. In the 1990s, by contrast, before its imbalances exploded, its index was one of the lowest. The United States is the only country to have seen a large increase in its misery index over the past decade. Virtually all the other G7 countries—including Europe—have seen sizeable improvements.

How exactly is "the misery index" defined by economists?, you ask. You take unemployment, inflation, interest rates and the budget and current-account balances, but then subtracts GDP growth (as it's a positive factor), add to a special economist blender and press the button. Eccoci!, you have a misery milkshake. That foul taste in the Yank shake is the balooning deficits.

As any homeowner can tell you, if you run up debts today, you have to bite the bullet tomorrow. As a nation, this means bigger taxes down the road to pay for the profligate spending of today. Of course, in the case of the Bush Administration, that budget deficit is financed in part by tax cuts for the super wealthy and sending troops to Iraq. Porca miseria, indeed!

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