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Macleans - How Canada stole the American Dream
HAPPY CANADA DAY!!!
DUNCAN HOOD | June 25, 2008 |
The numbers are in. Compared to the U.S., we work less, live longer, enjoy better health and have more sex. And get this: now we're wealthier too.
To be an American is to be the best. Every American believes this. Their sports champions are not U.S. champions, they're world champions. Their corporations aren't the largest in the States, they're the largest on the planet. Their armies don't defend just America, they defend freedom.
Like the perpetual little brother, Canadians have always lived in the shadow of our American neighbours. We mock them for their uncultured ways, their brash talk and their insularity, but it's always been the thin laughter of the insecure. After all, says University of Lethbridge sociologist Reginald Bibby, a leading tracker of social trends, "Americans grow up with the sincere belief that their nation is a nation that is unique and special, literally called by something greater to be blessed and to be a blessing to people around the globe." Canadians can't compete with that.
But it turns out that while they've been out conquering the world, here in Canada we've been quietly working away at building better lives. While they've been pursuing happiness, we've been achieving it.
How do we know? You just have to look at the numbers. For our Canada Day special issue this year, Maclean's compared Canadians and Americans in every facet of our lives. We scoured census reports, polls, surveys, scientific studies, policy papers and consumer databases. We looked at who lives longer, who works more, who spends more time with friends, who travels more and who has more sex. We even found out who eats more vegetables. After digging through the data, here's what we found: the staid, underpaid Canadian is dead. Believe it or not, we now have more wealth than Americans, even though we work shorter hours. We drink more often, but we live longer and have fewer diseases. We have more sex, more sex partners and we're more adventurous in bed, but we have fewer teen pregnancies and fewer sexually transmitted diseases. We spend more time with family and friends, and more time exploring the world. Even in crime we come out ahead: we're just as prone to break the law, but when we do it, we don't get shot. Most of the time, we don't even go to jail.
The data shows that it's the Canadians who are living it up, while Americans toil away, working longer hours to pay their mounting bills.
The wealth numbers, in particular, are shocking. As of 2005, the median family in Canada was worth US$122,600, according to Statistics Canada, while the U.S. Federal Reserve pegged the median American family at US$93,100 in 2004. Those figures, the most recent available, already include an adjustment for our higher prices, and thanks to the rising loonie Canadians are likely even further ahead today. We're ahead mainly because Americans carry far more debt than we do, and it means that the median Canadian family is a full 30 per cent wealthier than the median American family. "The fact that we're now richer is a big reversal," says Jack Mintz, former president of the C.D. Howe Institute and the current Palmer Chair in public policy at the University of Calgary. "It's a huge change in the way we view the world."
Mintz points out that it wasn't all that long ago that we were much poorer than the Americans. Just think back to the 1980s when our dollar was worth 69 American cents, inflation was raging, our real wages were dropping and our productivity was . . . well it was just embarrassing. "From 1987 to 1997 in particular, we had terrible economic growth," says Mintz. "By the time we reached 1999, we were way behind the U.S. in per capita incomes and everything else." Back then, he notes, the newspapers were packed with dire warnings of brain drain. Canadian incomes were so low compared to Americans, our best and brightest were fleeing the country.
Today, it's the reverse, and families such as Eric Nay, his wife, Polly, and their son are moving the other way. Nay, who's 41 and now works as associate dean at the Ontario College of Art & Design in Toronto, says he packed his bags and left his home in tony Monterey, Calif., for a new life in Canada two years ago. And get this: he did it for a bigger paycheque. "The academic salaries here are much higher," he says. "When I was working as an assistant professor in California, I was making $55,000, but in Canada, that magically becomes $70,000."
How did this happen? Canada often comes out ahead when you look at squishy things like quality of life. But since when were we richer? Mintz credits the rising loonie, the boom in commodities, and better public policy. He says that over the past decade productivity growth in the U.S. has slowed, while we've been hacking away at our government debt and lowering taxes. In short, as a nation, we've been doing everything right, while the U.S. has been doing everything wrong.
When you look at how individual Canadian and American families make and spend their money, it gets even more interesting. The numbers show that our median household incomes are about the same, or at least they were back in 2005 when the most recent figures came out. That year the median household income in Canada was about US$44,300, after you adjust it for the exchange rate and our lower purchasing power, while the American median was US$46,300. Since then, the loonie has gained on the U.S. dollar, so we've likely narrowed the gap. But while our incomes may be similar to American incomes, we're still much wealthier because we have less debt. What you make isn't a good measure of how rich you are — to figure out your true wealth you should add up everything you have and subtract what you owe. And Americans owe more. A lot more. Here in Canada the average amount of personal debt per person is US$23,460. In the U.S. it's a whopping US$40,250. And all those numbers are from 2005, just before their housing market slipped into a sinkhole. If you looked at the numbers now, you'd find that Americans are even further behind, because their largest asset — their home — is worth less. "There has been a lot of destruction of wealth in the U.S. over the past few years," says Mintz, "and that would affect the net worth figures significantly. I would suspect that they would be even worse off today."
Certainly Canadians who venture down to live in the U.S. say there's a huge difference in how the two countries approach spending and debt. Gerry Van Boven grew up in southern Ontario but moved to the U.S. in 1985. Now he's 57 and living in Fort Lauderdale, Fla. He says his American friends seem genuinely puzzled by his reluctance to load on huge piles of debt so he can buy a big luxury car and a monster home. "Most of the people that I know who were born and raised here are a lot farther in hock than I am, and they think that's quite normal," he says. "They're like, 'Can't afford it? I'll just put it on plastic.' Whereas I was brought up to believe that if you can't afford to buy it in cash, you can't afford it."
The numbers confirm that Americans like to spend big. They have bigger homes than we do, averaging about 2,500 sq. feet, compared to only 2,000 sq. feet in Canada. They spend about 34 per cent of their annual household expenditure on their homes, compared to just 19 per cent here. They also love big cars. In the U.S., luxury cars and SUVs make up 21 per cent of the market, whereas in Canada, they make up only 11 per cent. The most popular model overall in the U.S. is the more upscale Toyota Camry, whereas we prefer the basic Honda Civic. "They like the big SUVs here especially," says Van Boven, "or at least they did. A good friend of mine went out and bought one of those big GMC Yukons a while back, but now gas is at $4 a gallon. I saw him the other day and asked when he was going to get rid of it. 'I can't,' he said. 'I don't own it yet.' "
Bibby, the sociologist, says the great American debt load is a direct result of their relentless quest for the best. "American culture is more consumer-oriented due to a more intense and more vigorous marketplace," he says. "My sense is that more dollars are spent per capita on advertising, for example. Little wonder then that per capita debt is considerably higher in the U.S. than in Canada. It is largely a function of the aggressive and successful marketing efforts of American companies." Health care, too, is helping to keep Americans in a state of owe, and for all the same reasons. In the U.S., as long as you have a good insurance plan, you have access to the best health care in the world. MRI machines are available on an hour's notice, there's plenty of staff, and the specialists are the finest there are. But all of that comes at a cost, says Van Boven, and every American feels it. "The absolute biggest difference, financially, that I noticed was the cost of health insurance," he says. "When my wife got laid off, we found out that you could keep the insurance you got through work for a while as long as you paid for it. But it cost $5,000 a year, and that was back in 1986. We couldn't afford that. So since then I've had no health insurance." Eric Nay, who moved to Toronto from California, says that even Americans with good insurance feel the pinch. "When I taught for the state of California, I had the best health coverage on the planet," he reports. "But when my son was born — and it was totally by the book, no complications — my insurance only covered the first $10,000 of the hospital costs. The remaining $8,000 came out of my pocket. And that's with full coverage."
Meanwhile in Canada, not only are we wealthier, but we don't even have to work as hard to make that wealth. In 2004, the average Canadian worker put in 35 hours of work per week, while our American counterparts put in 38. Only 30 per cent of Canadians work 45 hours a week or more, compared to 38 per cent of Americans. We also get — and take — much more vacation time. Employed adults in Canada get about 17 vacation days a year, and we take 16 of those days, leaving just one on the table. In the U.S., they get 14 days of vacation, but they only take 11, making them the world leader in yet another category: the working drudge.
Because we have more time off, Canadians tend to have a lot more fun. We spend more time with friends than Americans do, and we're much more likely to have a sit-down dinner with the family at home each night. We also tend to drink alcohol more often, with 27 per cent of us having a drink at least a few times a week, compared to 19 per cent of Americans. Nay says that our richer social lives were one of the biggest differences he noticed when he moved to Toronto. "It was only in Canada that I found myself going to the pub with friends and colleagues," he says. "I spend more time in pubs here than I have in any other place that I've lived. It's partly the culture, and partly because the quality of beer is fantastic."
Christian Lander is another Canadian living among Americans. He grew up in Toronto, but the 29-year-old moved to Los Angeles 2½ years ago where he runs the popular Stuff White People Like website, and he's publishing a book under the same name on July 1. He also finds that Americans like to do things big, but that doesn't always mean better. "The expectations here are just different," he says. "There's more ambition. More ambition to acquire more in terms of money and career. Whereas Canadians seem to be more European in that we care more about enjoying life." He's lived all over the country and says that it's very difficult to sum up the differences between Americans and Canadians because Americans are so diverse. The gaps between rich and poor, or black and white within the confines of the U.S. are much deeper and wider than the gap between the two countries. And within that mix, he says there's a subset of Americans who are just like Canadians. "Left-wing urban Americans," he says. "Canada is just a country of left-wing urban Americans." Still, he says that the relentless zeal, the private schools, the long work hours, not to mention the fact that everyone in L.A. seems to carry a gun, well, it all gets him down sometimes. His wife, who's American, is pushing to move back to Toronto, he says. "And yeah, we probably will."
Reginald Bibby notes the irony of the situation. The U.S. is a country that aggressively pursues happiness, but Canada seems to have just stumbled onto it. While Americans are putting in overtime to pursue the American dream, we're at the pub having a few pints with friends. They may have bigger cars and bigger homes, but they're living under a mountain of debt. They look richer, but the numbers prove that they're not. The truth is that all of that competition, all of that keeping up with the Joneses, can take its toll. Getting ahead can be a lot easier when everyone is moving in the same direction. "The pursuit of happiness is ingrained in Americans as part of what it means to be an American," Bibby says. "But in Canada, happiness is almost something of a by-product of coexisting peacefully."
Be it sports, health care, business or wealth, Americans are still competing to be the best. And it's true that the best in the U.S. is the best you'll find on the planet. But when you look at the medians and the averages, their accomplishment pales. As the hard numbers in this report show, Americans have shorter lives, poorer health, less sex, more divorces, and more violent crime. Which may mean that perhaps America isn't the greatest nation on earth. After all, you can't judge a nation by the best it produces, you have to judge it by the success of the average Joe. And the average Joe in Canada is having a way better time.
http://www.macleans.ca/canada/natio...13_50113&page=1
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