Wow! The January, 2011 International Living just arrived in my mailbox and I am speechless. . . stunned. They’ve named the 2011 Top Quality of Life countries and they’ve put the USA at the top of the list.
Since I saw the article, I’ve been thinking and doing more reading, because my level of “stunned” has not gone down. How could International Living, which usually is right on target, be so far off on this one?
Now, to give them credit, they issued a bunch of disclaimers in the article. In fact, almost the entire article seemed to be a disclaimer. Which begs the question, why publish something so patently off-base that you have to use all those words to explain it away?
They describe the US as, “a clear, if uninspiring, winner.” They state clearly that the result is based solely on numbers. They explain which statistics put the US in the forefront.
They admit that “statistics don’t always reflect the reality.”
“The truth is: in dozens of other countries, ranked lower in the final count than the U.S., you can enjoy a life of equal quality — with the same levels of comfort — at a much lower cost.”
“Bear in mind that the score of 100 does not indicate perfection. It just means that the country scored highest in the category. For example, the U.S. Economy is not perfect (far from it), it’s just the highest scoring in that category. The rest of the countries are then arranged in a spread, the lower the score, the worse the country does.
“Every index is prone to a little ‘nonsense by numbers,’ which is why we include some subjectivity in ours. Statistics obtained from offialdom are not always accurate or reliable. Since the stats we gather don’t always reflect our own experience, or yours either, we sometimes interject a subjective factor to fill the gaps.”
Here are three specific items in these rankings really made me scratch my head.
Cost of Living
They give cost of living more weight (20% of the total) than any other category. According to IL’s explanation:
“This is a guide to how much it will cost you to live in a style comparable to—or better than—the standard of living you’re likely enjoying in the U.S. Our primary source in this category is the U.S. State Department’s Index of Overseas Living Costs, used to compute cost-of-living allowances for a Western-style of living in various countries. We also consider each country’s national debt.”
All the scores run from 0 as the worst to 100 as the best. The US scored a respectable 76 in this category. But what does that compare to?
Iraq and Gambia scored 100, with Afghanistan following at 99. Luxembourg scored 0. Zero! Mexico — that same Mexico that we’re being told all the time is a much less expensive alternative to living in the US — scored 77 and Ecuador and Panama both scored 78. Nicaragua, another low-cost alternative to the US, scored 85. Thailand‘s score was 77.
Huh??? So what is it? If you can truly retire in Ecuador (score of 78) for $600/month, as IL claims on a regular basis, does that mean you can live in the US (with health care!) for just a little more than $600/month? I don’t think so. . . In fact, according to these scores, Ecuador would be more expensive than the US.
If this is the quality of information the State Department offers, I say, ditch this index and find another that accurately reflects the cost of living.
Keep in mind, too, that cost of living is their most heavily weighted category. Therefore, they should make sure it’s the most accurate, but these numbers are pretty worthless.
According to the detailed rankings, the US scored 90 in the Health category. Japan and France led the way with scores of 100 each. We were also beat by Switzerland, Belgium, Sweden, Austria, Germany, Iceland, Greece, Spain and New Zealand. And Cuba, which scored a 93 to our 90. Canada and the UK scored 84 and 82 respectively.
Here’s the methodology:
“In this category, the number of people per doctor, the number of hospital beds per 1,000 people, the percentage of the population with access to safe water, the infant mortality rate, life expectancy, and public health expenditure as a percentage of a country’s GDP.”
Now, the top rankings for France and Japan don’t surprise me a bit. France’s health care has been the gold standard by which others are judged for years.
But here’s what bothers me. What good are doctors, hospitals and modern technology if they are unavailable? Over 50 million Americans have no health insurance, and therefore no practical access to health care. In Canada and Britain, health care is available to everyone. The latest and greatest in medical diagnostic tools don’t do me a bit of good if I have no means to use them. In the UK, they may not have the most up-to-date tech (or they may, I really don’t know), but since everyone has access, I’ll bet they have more successful diagnoses and better overall outcomes.
Add to that the fact that we’re facing an explosion of chronic conditions like diabetes and depression, that infant mortality rates are not good, that our life expectancy is actually declining, and it doesn’t add up to good health care.
Economy weighs in at 15% of the total score, so this is another category they really should have gotten right. They give the US economy an eye-popping, jaw-dropping score of 100. Why? Because it’s big.
What did they consider? Interest rates, GDP, and rate of inflation. What did they not consider? Employment and debt. Unemployment in the US is still at levels not seen since the Great Depression, and we’re drowning in debt. We’ve never seen so many Americans losing their homes, and the outlook in the housing market is grim for at least the next five years. The middle class is rapidly disappearing.
How does this translate into a top-ranked economy?
Contrast this with the countries seeing phenomenal economic growth right now — China, India and Brazil — which they rated 78, 64 and 58, respectively.
Even honest, dependable organizations can make big goofs. I hope IL will rethink its methodologies and sources, and produce indexes in future that reflect what’s really going on in the world. The 2011 Quality of Life Index does not.
What do you think? Does this index accurately reflect the quality of life where you live?
Elle B says
I find this completely screwy too. I’ve been following your newsletter, reading others and doing my own research. Although retirement is over 10 years away for me, I certainly won’t be able to do it here.
I don’t subscribe to IL, but here’s question: Do they take advertising? That may be the only answer we need!
Elle, I’ve subscribed to IL for several years now. They do take advertising, but I can’t see that as the reason for this bizarre ranking. They also sell their own information products, workshops, conferences, etc., but again, I don’t see that as a reason. It’s very odd. If you go online to read their original article (I think as a non-subscriber you can access it), you’ll see almost the entire article is a justification for their numbers.
I think their statistical sources are way off and they need to find better ones.
John Taylor says
A lawyer friend of mine says that International Living, Sovereign man etc are written by the same self-promotional crowd. He reads these publications, and correctly so, as comic books, strictly for entertainment and not informational value. I have written to IL on several occasions to inform them of inconsistencies in reporting on two countries which I am familiar with; that is Panama and Uruguay but have never seen my information reflected in their rhetoric.
Both Panama and Uruguay have been painted as utopian wonderlands. Neither are. In the case of Ugy I submitted all the proper paperwork and got tired of waiting for residency and voluntarily withdrew from the process after two years of watching my paperwork move through the system like a volleyball. Unless your dream is to live like a recluse in a backwater village, you will find living in Ugy more expensive than in most US cities. Cars will cost double the price, gas 7.50 per gallon and there is a 22% VAT on all services and purchases. Remember a vat taxes all stages of production not simply at the point of sale. At a restaurant the result could be perhaps 40-50% not 22. Bet your IL living magazine does not advertise this fact. They do not point out that a simple residency process two years ago has, today, turned into a bureaucratic nightmare where of the say 100 people I knew only 3-5 were granted residency. It is advertised that you need an income of $500 per month but in reality if that is your total income you will be dead before seeing your residency papers. It is a rumor that couple needs to demonstrate $2,000/mo in today’s economic environment. If you are not willing to spend most of your time in Ugy waiting for residency papers that may or may not be forthcoming and are prepared to live their permanently and have the requisite income do not even bother to apply. Jun through Oct is winter and although there is no snow, it is damn cold and humid. You will need central heating. All utilities are gov’t owned and overstaffed and bureaucratic; that means expensive. My electric bill was $100 without trying and forget having an electric clothes dryer.
Although there are no income taxes on foreign income earned by foreigners; that policy is reviewed every two years. It is said that 80% of property taxes go to bureaucrats salaries and what is left over goes into infrastructure work. This is perhaps why you see a slow decay of streets and sidewalks. Streets though are relatively clean.
Agriculture is a mainstay of the economy. Having said that, if you want a good steak or cut of beef you will have to go to Buenos Aires as Uruguay exports the best beef. Banking, construction, tourism and government are the other major sectors. There is zero manufacturing in Uruguay due to costs, low population and bureaucracy. Uruguay is heavily dependent on inflows of capital from Argentina and Brazil. In the case of Argentina, a recent information sharing agreement between the two countries has dampened investment in Ugy along with the collapsing Argentinian economy.
The Uruguayan govt is very leftist. The president, Jose Mujica, is a reformed communist guerilla. Street beggars, dumpster divers (unemployed vagrants who search streetside dumpsters in search of hidden treasure) and even hookers with children can expect government issued cheques. Having said that, how likely is the next government to be non socialist.
A multi-millionaire friend of mine, who was also turned down for residency, on the basis of not spending enough time there called it a blessing in disguise. He owns property and says that as a perpetual tourist, he will always be under the tax radar if and when taxation on residents is introduced. I cannot say he is wrong in his logic.
People though, are the nicest friendliest people in the world and love to hear positive comments about their country. Inside though, they are proud and unhappy because the average monthly income level is about $750-$900 a month and that buys a very basic lifestyle. When my wife who is fluent in spanish talks to friends in her gym in Montevideo and explained that she owned a house in Panama, invariably the response was ” Then, why would you want residency here”. But, if you want to hear the “glass completely full” version of Uruguay, you can buy the Uruguay handbook from IL for a modest $89.
Of the two countries Panama is my preferred country. It is tropical and in the mountains temperate. People are not as intelligent or educated as Uruguay but are friendly and for the most part non-confrontational. It is closer to the US 2-1/2 hrs vs 10 for Uruguay and a plane ride is a whole lot cheaper from Panama. The immigration program offers lots of benefits to the foreigner and it is all round much more economical than Uruguay. In both countries the government is not as intrusive as in N. America.
Wow, John, sounds like you’re pretty down on Uruguay.
As to the residency, as you talking specifically about retirement visas? Because I know a couple who just got their residency in a matter of months. Perhaps others who are familiar with Uruguay will weigh in.
As to IL, I’m not at all a fan of their advice. Their rose-colored glasses are WAY too strong. You have to remember, they’re in business to sell their publications. OTOH, I AM a fan of Live & Invest Overseas. While their approach is pretty optimistic, they’re not afraid to point out problems, flaws and difficulties — much more realistic.
John Taylor says
I am very surprised to hear of someone being granted residency in a matter of months. That was certainly inconsistent with my experience. Was your friends’ paperwork submitted more than two years ago? In the last two years the process has become infinitely more complicated than it was previously. I would suggest that you confirm with your friends as to when they submitted paperwork. As previously mentioned, I socialized with perhaps 100 people in various ex-pat groups and knew only 3-5 people in the last two years that got permanent residency and all but one were in the process for more than two years and the other only one year. It was common practice for Immigration to do spot checks to see if you were actually present in the country and if you were not home at the time of inspection or 1/2 of the couple was there the paperwork would go to the bottom of the pile and you start over. I know one person who was bounced out of the final dept in the process several times even though that person met all the requirements. I know another who owns several properties and this couple has waited more than 5 years.
I am not intentionally attempting to discredit the Immigration Dept in Ugy. but only to report the reality, so people can determine if this is right for them and that so they can better see the reality and make an informed judgement as to whether Uruguay is right for them. I dealt with a major law firm and they too, were extremely frustrated with the new policy at Uruguayan Immigration.
In my two years in Uruguay I have seen people with limited resources move to Uruguay based on upbeat reports from retirement publications that distort the economic realities and ignore the new immigration policy, by glorifying real estate in remote towns and villages that are not quaint or even desirable places to settle, particularly for the linguistically challenged adventurer. People get drawn in by the illusion only to find the reality is quite different.
I met many people who chose Uruguay for it’s remoteness, believing that it offers them safe harbor from a New World Order. Those folks need to know that Montevideo is part of ICLEI (Local Governments for sustainable development) or Agenda21, so please be informed.
Be prepared for a lifestyle that is at least as expensive as the US and be prepared to remain in Ugy at least 6 months a year until permanent residency is granted. Remember too, that if you move furniture etc to Ugy you will be assessed a refundable tax that will not be returned until residency is granted. This in and of itself can amount to several thousand dollars. If none of this bothers you Uruguay might just be for you. If you still have your sights on S. America, other countries such as Chile which is more pro business and less bureaucratic offer have greater appeal.