Arthur Brooks – President, American Enterprise Institute
If I do my job in the next few minutes, I’m going to give you the secret to happiness so that when you go home tonight you can start living a happier life and you can start sharing with more people, so that they can have a happier life too, So let’s start with what we know about happiness.
There have been hundreds, literally hundreds, of studies by economists and social scientists and psychologists about happiness, hundreds over the past thirty and forty years. And basically they all start by asking the question: who’s happy?
In the United States we know that all the way back to the 1970s a very stable proportion of the population is very happy. About a third of Americans say anonymously and in accurate tests an accurate surveys that they’re very happy people. Okay, we have no reason to doubt that this is true. A little over 50% say they’re somewhat happy, about 10% to 15% of the population is chronically depressed and say they’re not very happy.
Okay now, that’s actually not the most interesting question. The most interesting question is what brings happiness. And we know the answer to that too. It’s three things; three things bring happiness: genetics, big life events, and choices. And I’m going to tell you about all three, starting with genetics.
Now, a few years ago social scientists at the University of Minnesota constructed a wonderful database that included 75 pairs of identical twins born between the mid-1930s and the mid 1950s. Now they were separated at birth and adopted by separate families. It’s like a social scientist’s dream; it’s almost as if the government had done this.
And at age 40, they were reunited and they were given a personality test, so they were asked about the things that were going on their lives and the way that they viewed their lives.
And what did they find? They found that 48% of their happiness is genetic. As a matter of fact they found that more of their personality was genetic than they ever understood before. 40% of how you vote is genetic; 40% of how you worship is genetic, so this explains some things. Do you have someone in your life who is chronically happy? Do you have a coworker who’s happy all the time? It’s very irritating, by the way, and so sometimes you wonder, that person is just happy all the time.
What are they doing right? What’s their secret? Their secret is their DNA. Are you a grumpy person, are you dark and brooding? It’s your DNA; it’s not your fault, you have lousy parents is basically what it comes down to.
So if that’s the case, does it really matter what we do? The answer is yeah, because if half of it is taken away from you you better get the other half right. Now 40% is genetic but there are other innate qualities, other innate characteristics that are really important, the most interesting of which is gender.
Who’s happier, men or women? The answer is women. Most studies, the overwhelming majority of studies, find that women are happier than men and always have been. Okay, I mean it’s too bad guys but I studied this myself and I find the same thing. I’ve looked at the happiness of men and women by marital status and what do we find? Married women are happier than married men, single women are happier than single men, widowed women are way happier than widowed men. What’s so funny about that? I told that one to my wife and she says, “Oh, no kidding.” In general women are happier than men.
Here’s another interesting mystery: what’s the average unhappiest age in a man’s life? I’d heard about this phenomenon forever, so have you, this is the male mid-life crisis, right? When do you think it is? 70, 17. That doesn’t count, only grown ups 45, 45; it’s 45 that is exactly right. 45 is the average unhappiest age in a man’s life. And it goes something like this: the trajectory of life for men is interesting and sometimes a little sad.
See, when you’re in your twenties and thirties the life recipe is actually kind of simple. Life is like a super highway when you’re in your twenties and thirties. If you want to get ahead and you want to have a better life and you want to be happier and more successful just hit the gas. Just look for more money and look for a better career and look for more promotions and it’s simple.
The problem is on the superhighway guys get to age 45 and a bunch of them stop and they say “I think I’m on the road. I don’t want to be on the superhighway, but I can’t stop because I’ve got the house payment and I’ve got all this stuff; It’s hard, I’ll get hit or get in an accident if I stop, it’ll be bad if I stop, a whole lot of guys find.
Now, OK, next question: what do they want? Staying on the same metaphor, what they want is to be on another road that they picked themselves they want to be on a little dirt road with a motorcycle on it where the driver is not wearing a helmet. That’s what they want, so who’s the guy on the motorcycle because the secret to happiness is being the guy on a motorcycle without the helmet. So I want to know who he is. Tell me about it. I know who he is.
He is me. And I’ll tell you how it works. When I was 19, I dropped out of college. Dropped out, kicked out, splitting hairs I ran off to play music for a living. I was a French horn player, that was all I wanted to do. I wound up in the Barcelona symphony by my my late twenties. It was great, I love the music, I still love the music, it’s the best music ever written. Seems like a dream, right?
But I got a glimpse of my forty five year old self. I got to look in the crystal ball, it was all the guys working with me, who were usually 20-30 years older than me, who around 45 had kind of lost their happiness and now they were drinking a little too much and their marriages weren’t so good and they didn’t like the music so much.
And I said I don’t want to be those guys, so I got lucky. Because I saw it and I hatched a plan, I hatched a plan to escape and I decided to go back to college. And I called my dad and I said, “Dad I got big news! I’m going to quit music. I’m going to go back to college. I’m going to study, I don’t know, literature, physics, poetry, or economics or something. It’s going to be great. I’m going to use my brain.”
My dad said “What are you talking about? You started a family, you’re doing fine, it’s very irresponsible to just quit when you’re in your late twenties, why?”
I said, “Dad, because I’m not happy. And I don’t think I’m going to be happy.”
And there’s a long pause and he says “So what makes you so special?” Today I’m doing what I love. Today I’m doing what I feel like I’m called to do. Today my job is to talk to you about how to have a happier life. What a miracle! Now it’s not good enough for people to accidentally find the way we need to find it on purpose. Okay so innate differences: genetics, 48%.
The next big one is big life events. This is what you think really drives your happiness. You want to be happy? Go for your goals. You got these big goals in life and avoid the bad stuff, right? You think about it all the time. If only I can graduate from college with a good enough GPA to get a good job, then I’ll be happy, right? If only I get into law school then I’ll be happy; if only that girl will marry me then I’ll be happy, and if I don’t get sick I won’t be unhappy, right? If I don’t have an accident, I won’t be unhappy.
We think in this way, we are very goal-oriented creatures. Now how much of our life happiness at any particular point comes from the big things good and bad? Answer is 40%. That’s a lot. It seems like you’re absolutely right to be chasing the big thing in any particular moment, trying to avoid the big bad thing at any particular moment but that’s wrong. It’s 40% but I’m going to tell you why not to chase it.
Two reasons: number one is we’re very bad at getting the things that we’re seeking, the big goals that we’re seeking, but more importantly the big things never last. How long will your mood be improved if you get that dream house? Six months. If I double your pay, how long will it improve your mood? Up to six months, no more. No matter what you do it’s going to wear off, the big stuff wears off. But the costs of doing these big things last forever.
Don’t chase the big thing. There’s one study that really points this out. The most interesting study I’ve ever seen. From 1978 actually it’s an old study, but it’s still classic. And it compares two groups of people: quadriplegics, and people who win the lottery.
What do these people have in common? A huge punctuation to the equilibrium BOM bad or good right? Now quadriplegics six months after their accidents, on average, their happiness has returned almost to its level prior to their accident. That’s what the study shows. Now not all the way but almost all the way.
See how durable we are? Six months later they would, they still say I would do almost anything to get to be able to control my arms and legs to not be confined to a wheelchair, but their happiness is something that is innate, and has to do with other forces. Okay, that’s fine study number one, number two is lottery winners.
This one’s actually even a little bit more interesting. Six months after you hit the lottery the average lottery winner has permanent baseline happiness levels that are slightly below where they were the day before they bought the ticket. Literally the best thing that can happen to you when you buy a lottery ticket is that you don’t win. Why? We know this too. It’s because they’ve blown their circuits.
The little things in life don’t make them happy. Think about what is going to make you happy this weekend. Hanging out with loved ones, it’s doing the things that give you a little bit of gratification with the people who make you happy. You’re going to watch some sports, you probably go out to dinner, you’re going to be around people who you’re comfortable with and you’re going to joke around, have a great time. Turns out people who win the lottery don’t get that anymore.
All of their hobbies are dross, their friendships are all different; they don’t enjoy the little things they used to enjoy anymore. So they go in search for more flavor. The truth is if you want to be happy, don’t spend your time obsessing about the great big splash. What you need are habits that will give you the highest likelihood of getting that 40% that will drive these events most likely into your life and drive the bad things out of your life in a regular framework as a regular type of discipline.
So what are these lifestyle elements? And this brings us to the last 12%. Remember 48% is genetics, 40% is events, you got 12% left, that 12% you have left are under your control. And if you do the things you need to do to get the maximum from the 12% you’re also going to raise the likelihood of getting the 40% because this gives you the best lifestyle to give you the best luck.
So what we need to know now are the things and there are four of them, that will give you the 12%. And this is where the knowledge is power. This is where you get to walk out of here ready to invest in your happiness portfolio and be a happier person starting tonight. Here’s the good news: simple, available to everybody, and easy to understand.
Here are the four: faith, family, community, and work. Those are your big four. That’s your happiness portfolio. Don’t waste your time on other stuff. Because if you do, you’re going to be going in the wrong direction.
Family, I mean I’m sorry, faith is pretty obvious. The interior life, I’m not going to tell you which faith, but thinking about the transcendental, thinking about the things that are not of this world, and incorporating them into your life. Family, having solid family relationships, these are the things that can’t and shouldn’t go away. Community is a little bit more complicated, the elements of community are cultivating important friendships and being charitable in your community, being a charitable person toward others. That’s what it means to have community in your life.
I’m not going to spend my time on faith, family, and community; I’m going to spend the rest of my time on work, because that’s the counterintuitive on.e Work is such a big deal, you watch “The Office,” you read Dilbert cartoons, right? Work is just a drag, right? At least for other people, you probably like your job, but other people, probably not so much.
What percentage of Americans like or love their jobs? What percentage of Americans are satisfied or very satisfied with their work? Right, think about it, get a number in your head, you’re thinking 20%, 25%, 89%. Eighty-nine percent of Americans are either satisfied or very satisfied with their jobs. What an incredible thing! No other country comes even remotely close, why? Why? Because of money? No, that’s not one of the big four, I didn’t say faith, family, community, work and money. No, money’s not on the list, and in truth many economists, including me, we’ve studied the effects of money on happiness.
Money does bring happiness by relieving pressure to people who are poor, up to the level of the lower middle class, then it flattens out a lot. Brings a little bit but it takes a lot of money at higher income levels to bring any sort of satisfaction. Right, so money is really not it, it’s something else.
What is it that brings so much happiness to so many people from work? Besides the guys who’re bummed out at age 45. So what is it? We’ve looked and we’ve looked and we found it, we found it. It’s earned success. It’s the belief that you’re creating value with your life and value in the lives of other people. Earned success is truly the key to happiness through work. If you believe that you’re serving others and you’re creating value with everything you do, I don’t care what you do because people who believe that they’ve earned their success and are happy in their work are the same whether they have a college degree or a high school degree or no high school degree, whether they have above-average incomes or below average incomes, whether they classify themselves as lower-middle-class or middle-class or upper middle-class it doesn’t matter. It doesn’t matter, it matters whether or not they think they’re creating value with their lives that they are earning their success.
If you take two people precisely the same the data from the University of Chicago General Social Survey the best survey database that we have in the United States today, two people who are the same age, sex, race, religion, same level of education, and they both say they’ve earned their success, but one person earns eight times as much money as the second, they will be equally likely to say that they are very happy about their lives. What an incredible thing, money doesn’t buy happiness, earned success is it, and that’s what the guy on the motorcycle has, that’s what he has. He’s earning his success, that’s what we want. I want to be that guy, why? I want to have life on my terms, I want to build my life, I want my life to be my enterprise. That’s the spirit of American entrepreneurship that’s the American dream Enterprise is not building a business, enterprise is building your life.
And if you do it and you earn your success, you pursue your happiness. That’s the moral covenant of our founders to us when they talked about the fact that we’re endowed by our Creator with the unalienable rights of life, liberty and the pursuit of happiness, they might well have said and earning our success. What an incredible miracle!
It’s not just happiness for you and me, incidentally, happiness for everybody. What’s the difference between now and the world I grew up in when I was a little kid? When I was a little kid, 1970 what was poverty in the third world? Poverty in the third world was a picture in the National Geographic with a kid with a distended belly and flies on his face, who is poor and was gonna die, and there was nothing. I could do about it and there was nothing you could do about it.
That was poverty in 1970 , comparing 1970 to today, the percentage of the world’s population living on a dollar a day or less, that’s the standard measure of poverty among development economists, the percentage of the world’s population living on a dollar or day or less since 1970 has declined by eighty percent, that’s the world’s greatest anti-poverty achievement ever. Is it the fabulous success of the United Nations? Is it, it’s not a laugh line my friends, is it the International Monetary Fund or the World Bank? Those might or might not be effective organizations depending on your point of view but it’s not those things.
It’s five things, according to development economists… it’s globalization, free trade, property rights, rule of law, and entrepreneurship. Now you can give to charity all day long but you got to have a system that works while you sleep. You got to have a system that works even when people are not trying to make it work and that system exists, it’s the free enterprise system, what an incredible miracle. The earned success system that brings you happiness is the system of free enterprise that lift people out of poverty, that lets people live around the world.
This is the reason that the free enterprise system is not an economic alternative, as it’s often described, the free enterprise system is a moral imperative, earned success needs the free enterprise system, poor people need the free enterprise system.
What is that system? It’s a system that matches our skills with our passions, it’s a system that celebrates hard work and merit and personal responsibility and rewards opportunity, it’s a system where you can keep what you earn, these are moral goals because they lift people up, not because they make people rich, forget about making people rich. They let people live their life as an enterprise, that’s what I accidentally found, that’s the guy on the motorcycle, that’s what people have a chance for the first time in history, to achieve in the third world, that’s what you can build when you fight for the free enterprise system.
I want you to remember two things: the pursuit of happiness sounds complicated, but it’s really not. You have under your control the portfolio to give you the most happiness possible.
Start paying attention more, more and today, to faith, family, community, and work. Second, do you want the rest of the country to be happier? Do you want the rest of the world to have a better shot at the happiness that we feel is our moral right passed on by our founders? Then work for the system that makes it possible, don’t work for the socialism that makes it harder, don’t work for the statism, the collectivism that suppresses this, work for the free enterprise that makes this possible, because if you do, if you do that, then you’re truly working for the common good, and for that my last words to you are thank you.
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