A recent column by Allison Schrager that appeared in Bloomberg poses a puzzle: Americans have never been richer, and they have rarely been angrier. Indeed, by nearly every objective measure of material flourishing, such as life expectancy, real income, hours worked to buy food and shelter, access to technology that did not exist a generation ago, the average American lives better than his grandparents did. The mood does not match the record. The explanation lies partly in the happiness data themselves and partly in how people evaluate their country compared with their own lives.
Schrager invokes the Easterlin Paradox. In 1974, Richard Easterlin observed two findings that appeared to contradict each other. Within any country at a given moment, richer people report higher well-being than poorer ones. If income raises well-being for the individual, one would expect it to do so for the nation. But as a country grows richer across decades, average reported happiness appears to remain flat.
That conclusion rested on thin evidence, however — mostly American data over a few postwar decades. Betsey Stevenson and Justin Wolfers reexamined it in 2008 using global surveys covering far more countries over a much longer period. They found that rich countries report higher well-being than poor ones and that growth raises reported well-being over time. The relationship is logarithmic: Each doubling of income adds roughly the same increment of satisfaction. A rise from $2,000 to $4,000 a year does about as much as a rise from $40,000 to $80,000. That accounts for much of the apparent paradox. In a wealthy country, a 3 percent raise is a small proportional gain, so the measured return looks negligible even though the relationship between income and well-being remains intact.
The same correction has been applied to the best-known finding in the field. In 2010, Daniel Kahneman and Angus Deaton reported that day-to-day emotional well-being stopped improving above roughly $75,000 in annual income. In 2021, Matthew Killingsworth, sampling moods in real time through a smartphone application rather than asking people to recall the previous day, found no such ceiling.
The two camps then conducted an adversarial collaboration and reanalyzed the data jointly. Their 2023 result: For the least happy fifth of people, well-being does flatten above a threshold, because, the authors suggest, heartbreak, bereavement, and clinical depression are not problems that income solves. For the remaining four-fifths, well-being continues to rise with income and rises fastest among the happiest. Kahneman accepted the revision of his own finding.
Easterlin has not conceded. His 2022 work with Kelsey O’Connor maintains that the long-run correlation between growth and happiness disappears over horizons of 20 years or more. The dispute is now largely technical, and it is not settled.
Two cautions are warranted on the skeptics’ side. Happiness scales are bounded from 0 to 10: Someone who rated his life a 7 in 1975 cannot report a 14 today, however much better his circumstances have become, so the instrument understates real gains. And income was never the dominant variable. Health, marriage, friendship, employment, and a sense of purpose account for more of the variation between individuals than earnings do, which is what one should expect if markets are a means rather than an end.
The sharper explanation for American discontent has little to do with Easterlin. When Americans are asked about their own lives — their health, families, safety, and standards of living — roughly four in five report satisfaction. When the same population is asked about the direction of the country, satisfaction falls to a quarter or less. The pessimism is aimed at the nation, not at the respondent’s own circumstances.
Three mechanisms produce that gap. The availability heuristic, identified by Amos Tversky and Daniel Kahneman in 1973, leads people to judge how common an event is by how readily an instance comes to mind. Negativity bias, summarized by Roy Baumeister and co-authors in 2001, means adverse information registers more forcefully than favorable information of equal magnitude. And the economics of media reward salience: Incremental improvement is not reportable, while price spikes, scandals, and disasters are. Personal experience is drawn from direct observation. National judgment is drawn almost entirely from mediated information selected for alarm.
The consequence is not merely a sour mood. Voters who conclude that democratic capitalism has failed them will accept price controls that suppress supply, tariffs that reduce trade, and immigration restrictions that cut off the inflow of talent that generates new ideas. Dismantling the institutions that produced current abundance on the strength of a misperception would convert a false belief into a true one.
Progress does not promise total contentment. It is a method for solving problems. Housing costs, childcare costs, and failing schools are real and specific, and they yield to reform, competition, and technical ingenuity, as thousands of comparable problems have. The mood, then, is not a verdict on the record. The mood is a verdict on the story Americans have been told about the record. They have never been richer, and they have rarely been angrier — but the anger is best aimed at the specific problems that remain, not at the machinery that solved all the others.
This article first appeared in National Review on 7/30/2026.
Marian, this is remarkably close to the question that led me to start Exploring Prosperity. I've argued that setbacks are events, while progress is a process. The former commands our attention; the latter accumulates quietly, often escaping notice.
I wonder whether rising expectations are also part of the explanation. As prosperity improves, our definition of what constitutes an unacceptable problem keeps expanding. Could our pessimism be, in part, a consequence of our success?