Does the happiness formula really add up?

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The Noughties were never going to be good for pessimists. The tone for the decade was set in 1997. As a grinning Tony Blair romped home to a soundtrack of "Things Can Only Get Better", an American psychologist named Martin Seligman, renowned in his field for his work on "learnt helplessness", was elected president of the American Psychological Association. Within months, he announced that having devoted 35 years to the study of human suffering and mental illness – the standard fare of psychologists – he would use the platform to explore human happiness instead.

The idea wasn't new – since the 1950s, voices in the American psychological community had been suggesting that the discipline would benefit from an arm devoted to what makes us feel good rather than bad. But Seligman was the one who did it. In 2000, he set up the Positive Psychology Centre at the University of Pennsylvania and the tentacles of the movement have been spreading ever since.

Seligman soon came up with a formula for happiness, H=S+C+V, where happiness (H) is the sum of a person's genetic capacity for happiness (S), their circumstances (C), and factors under their voluntary control (V). Research showed, he said, that circumstance (in particular wealth and health) plays a less important role in our happiness than most of us believe (executives report only slightly higher levels of happiness than people in the post-room); and that people who become paraplegic eventually return to their previous levels of happiness.

What this means is that voluntary control – the V in his equation – has a high value, which means we can all learn to be happier (not least, Seligman would no doubt say, by using the exercises in books such as his own Authentic Happiness: Using the New Positive Psychology to Realise Your Potential for Lasting Fulfilment). We should do this not only because happiness is desirable in and of itself, but research shows that happy, optimistic people are healthier, live longer, are more successful and have more fulfilling relationships.

To achieve greater happiness, positive-psychology advocates "learnt optimism" exercises, such as sitting down each evening and listing things that went well that day; learning to feel grateful for what we have; and practising random acts of kindness. Seligman also points out that lasting happiness has nothing to do with the hedonistic pleasures – shopping and partying – and more to do with solid values: a sense of community and meaningful work. If it is all starting to sound a bit like self-help, positive psychology has always made much of its academic credentials. Everything it advocates is research-based and proven, it insists.

The reach of positive psychology stretches beyond the personal. Seligman's equation has political consequences, because if C is small and V is big, and circumstances play a relatively small part in our happiness, then governments concerned with wellbeing should focus less on increasing wealth. One of the clarion calls for the movement is the Easterlin paradox, an economic concept that shows that while GDP has risen steadily in the West for decades, reported levels of happiness have not changed. Money isn't making us happy, so something else has to. In the US, positive-psychology programmes have been adopted in schools, colleges and even the army.

For most of us here in the UK, the biggest visible effect has been a steady stream of headlines and features devoted to the new science of happiness. Positive psychology has proved itself much more media-friendly than the traditional kind and its depressing studies into misery and mental illness. "How to be happy!", "Money doesn't buy you happiness", "Happy people are more successful/have more friends/live longer" make appealing features. The BBC famously attempted "Making Slough Happy" in 2005 using the new techniques. A slew of sunny books have lured us with promises that we, too, can be happier – and here's the science to prove it.

The ideas have informed government policy here, too. The LSE economist Professor Richard Layard is the most prominent disciple of happiness science in the UK, and lobbies for a change in emphasis in policy away from increasing GDP and towards improving wellbeing. As Labour's "happiness tsar", he oversaw a big change in the NHS frontline mental-health provision and encouraged "happiness ' skills" teaching in schools. His latest venture is the "Movement for Happiness", which will launch this summer.

In an interview about the new venture, he said that "Increasingly people ask, 'What is progress?' For 50 years we have aimed at higher incomes – and got them. Yet over the same period there has been no increase in happiness (in Britain or the US), as measured by surveys. And there has been a shocking rise in the number of unhappy and disturbed children. Clearly we have got our priorities wrong and our society needs a radical change of tack."

You can't argue with that. Or can you?

For some time, I was a fan of positive psychology. I am a sitting duck for the self-help industry – a bit pessimistic by nature, and dogged by a belief that I should somehow be "doing better". This seemed to me an excitingly scientific development. I studied optimism exercises, put my neighbours' bins out as an act of random kindness, and lapped up research reassuring me that even if I did have a Goldman Sachs salary, it wouldn't make much difference to how I felt.

But increasingly, it is all getting on my nerves. I know that being on chatting terms with my neighbours and spending time with my children and doing work I find satisfying is fundamental to my happiness. Don't most of us know that instinctively? But I also know that right now a substantial increase in my income would do more than anything to transform the quality of my life. Not because I want £600 handbags, but because I would like to be able to save for my old age and worry less about paying the mortgage.

The concept that beyond a modest level, money does not buy you happiness underpins positive psychology. The reason, it says, is that humans judge affluence by comparing themselves with others. If GDP goes up and we are all a little better off, it has no impact on our individual sense of wellbeing. "Of course people care about the level of their income, but most of all they care about how their income compares with other people's," writes Layard.

But at what level does that kick in? Different figures have been bandied about over the years, but in an interview at the end of March, at the launch of the Movement for Happiness, Lord Layard cited "evidence from the US" that showed that beyond an annual salary of £60,000, rises in salary do not lead to significantly greater increases in happiness. According to the statistics I have in front of me from the Inland Revenue, only around one in 16 people in the UK earn more than £60k. So does any of this have any relevance for the rest of us, the vast majority of people grappling with the insecurities and pressures of the recession?

"Statements about how money does not bring happiness are more often than not made by well-off, middle-class men, and for that reason I am very cynical," says Richard Tunney, associate professor of psychology at the University of Nottingham. "Yes, once you achieve a certain lifestyle and security, each additional increment is going to bring fewer benefits. But most people aren't at that top end. In fact, most people aren't even in the middle, with a decent lifestyle with a secure job. The average wage in the UK is less than £25,000. I live in a very ordinary part of a very ordinary city, and £25,000 is not going to buy you a house and you would be lucky if you could rent a flat. For most of us, if we want to earn a sufficient amount of money to provide a good lifestyle for our families, we don't see our families, and that has serious psychological consequences in the long term. Any additional money for most people is seriously going to affect their quality of life." Prof Tunney has studied Lottery winners and confirms that they are "measurably happier".

The idea that happiness in the West has not increased for 50 years despite consistent increases in GDP is itself open to dispute. In 2008, two economists at the University of Pennsylvania, Betsey Stevenson and Justin Wolfers, questioned the Easterlin paradox when they reviewed EC statistics since 1973 from the Eurobarometer survey and found that life satisfaction had increased modestly but consistently alongside GDP in eight of the nine European countries, including the UK. In America, they found that while happiness overall has not increased, it has for some people (men, non-whites, college graduates). The big losers are women and the less educated. Broad brushstrokes, as always, make good headlines – but underneath there lurk more complex truths.

One thing is for sure: if GDP declines – the measure of recession – happiness levels fall; a phenomenon that many of us are experiencing first-hand. The fear of losing your job, the stress of debt, the spectre of huge cuts to schools and services – these are basic things that undermine wellbeing. (The NHS last week revealed that it issued 39m prescriptions for drugs to treat depression in 2009 – a 95 per cent jump over 1999, part of which has been ascribed by commentators to stresses triggered by the economic downturn.) That C in the happiness equation has become more and more prominent for more and more of us. And statements about how happiness is within our voluntary control whatever our circumstances just start to sound glib and irritating, and like some modern-day opium for the masses. "Don't bother asking for a pay rise – it won't make you any happier anyway."

Lord Layard is genuine and evangelical about the possibilities of the new science of happiness and its ability to transform poor people's lives. In 2005 he argued to the Number 10 strategy unity that unemployment had been replaced by depression as the scourge of the poor. Since fewer people were claiming unemployment benefits than incapacity benefits for mental illness, tackling this would help the economy as well as the wellbeing of the poorest in society. He argued passionately for cognitive behavioural therapy (CBT) – a short-term therapy that focuses on thinking and behaviour – to tackle this. The result, and his biggest legacy, is the Improving Access to Psychological Therapies (IAPT) initiative, based on a massive expansion in CBT as the NHS's primary treatment for depression.

CBT is different to positive-psychology exercises. It is an established clinical treatment for mild and moderate depression and disorders such as phobias, and unlike psychotherapeutic and analytical therapies which focus on the past and the deep causes of problems, CBT focuses on the here and now. It teaches people to recognize the links between thoughts and feelings and mood and to alter these. It is usually a short-term (and therefore inexpensive) therapy. Much of the new NHS provision is based on an eight- session computer course that patients can follow at home, with the guidance of a trained practitioner.

Practitioners generally respect the evidence supporting CBT as an effective treatment, yet there is criticism of IAPT from within the therapy community, mostly focused on the way in which other therapies are being pushed out. "CBT is effective on mild to moderate anxiety and depression, and a simple diagnosis," says Phillip Hodson, spokesman for the British Association for Counselling and Psychotherapy. "But the diagnosis may not be simple. There may be lots of other aspects and what we are seeing is that some of these are not being treated or managed. Some primary care trusts are completely cutting the old programme, yet the evidence on CBT is that it won't work for everyone, and that for those people, other therapies can work."

Another question is whether CBT is enough to make a lasting change to people's lives, especially those at the bottom of the social scale who most need it. "The notion that a few weeks of CBT will transform miserable people languishing in idleness and dependency into happy shiny productive workers is embarrassing in its absurdity," wrote a GP, Mike Fitzpatrick, in the British Journal of General Practice, as the initiative was launched.

Where CBT and positive psychology do share air space is that they focus on the here and now. But while CBT is a structured therapy aimed at helping depressed people, positive-psychology techniques aim to make well people happier. Where Freud defined successful therapy as turning "hysterical misery into common unhappiness" – a negative into a smaller negative – positive psychology works on a positive scale, aiming to transform wellbeing from, say, a two to a six.

Professor Tunney, who is respectful of CBT, is a bit sniffy about positive psychology. "Martin Seligman did some really good work in the 1970s and 1980s on depression but the stuff he is doing now doesn't really hit the academic radar here." Psychology in Europe has followed a different path, he says.

So are these optimism exercises and mindfulness techniques just a jumped-up form of self-help?

I have one of the books in front of me, The How of Happiness by Sonja Lyubomirsky, professor of psychology at the University of California. As I said, I am not unfamiliar with the genre and this certainly looks like a self-help book, with its happy sunny yellow cover and its aspirational tagline "A Practical Guide to Getting the Life You Want". And it reads like a self-help book, with lots of personal anecdotes and exercises and inspirational case studies of people who are happy despite terrible circumstances and, of course, the reverse – people who have everything yet still can't seem to feel good.

Lyubomirsky insists that everything written here is backed up by science. But she loses my confidence early on when discussing her version of Seligman's happiness equation – the extent that happiness is within our voluntary control. For Lyubomirsky, circumstance accounts for just 10 per cent of happiness, our genetic set point for 50 per cent and "intentional activity" – what we make of our lives – for a whopping 40 per cent. She insists that "a great deal of science backs up this conclusion" and lists a couple of studies, but for me it is not enough to be what I would call compelling.

The exercises in Lyubomirsky's book are similar to Seligman's. A list of the chapter headings sums it up. "Practising gratitude and positive thinking", "Investing in social connections", "Managing stress, hardship and trauma", "Living in the present", "Committing to your goals", "Taking care of your body and your soul".

I have tried some positive-psychology techniques in the past. Some of it was helpful and some has even stayed with me. I think the idea that, since humans can't resist comparing, it is better to compare your situation with people who have less than you rather than more is invaluable, and I still give myself that reality check when I find myself envying someone's holiday home. And Seligman's ideas on focusing your energies on what comes naturally, rather than fighting to be good at things that don't, sticks too.

But I am starting to believe that what makes me happier than trying to improve my mildly depressed, less-than-shiny self is to spend time with like-minded people with whom I can be honest about who I am and how I feel. "I know what you mean" is one of the most beautiful phrases in the language.

So, my beef is less with the details of positive psychology and more with the way it functions. By lending academic credence to the idea that we can be better, shinier and happier if we just try, it has turned happiness into not only something we should expect, but yet another must-have commodity that you are failing if you don't achieve. The stream of studies showing that happy people have more friends and are more successful implies that we should all aspire to these things, even though they may be wrong for a lot of people. What if you are the sort of person who flourishes best in the slow lane? Or with a few close friends? At the risk of sounding incredibly homespun myself, isn't it better to know and accept yourself the way you are?

I suspect that Eric G Wilson, professor of English at Wake Forest University, would agree with me. In his book Against Happiness, he espouses the creative aspects of melancholy (how much great literature would have been written without it?) and explains how, after years of trying every self-help technique going, he has given it up. "I realise somewhere in the core of my bones that I was born to the blues," he writes. "If I don't adhere to this birthright, I would feel fake. My summons is to the mixed-up earth."

Phillip Hodson can see the benefit of encouraging a more optimistic perspective – "Life is a series of problems and you may as well enjoy it," he says, even if, as he points out, a pessimistic view is usually more accurate. His biggest concern is that this sort of approach could tip over into a fear of feeling. "Positive and negative emotions come in the same box," he says. How can you feel joy if you deny your anger? What happens, in this new world, to the dark side?

It is a question we need to ask, says the psychoanalyst Darian Leader. "We are living in a time when there is huge pressure to look happy whether you feel it or not," he says. "Despair, fracture and frustration – the only place for these emotions now is within the arts. Even in psychology, no one wants to know. But basic unhappiness and malaise are part of human life. If you can't express these emotions, they will resurface as new symptoms or as physical illness. It is important to have a society that recognises and acknowledges the darker side."

Indeed, in his new book The Uses of Pessimism and the Danger of False Hope (Atlantic, £15.99), Roger Scruton presents a robust case for optimists and idealists being responsible for some of history's worst harm and chaos. He believes there is more use for "humane pessimism".

Barbara Ehrenreich, the American campaigning journalist, blames American positive thinking for nothing less than the global economic crisis. Too much optimism can be a dangerous thing, she warns in her book Smile or Die. But there is a much more personal dimension to her exploration of this subject. Ehrenreich's experience of cancer made her examine more closely the reported links between happiness and health. This works on two levels: health, like money, is part of the big C for circumstances, and according to positive psychology has much less impact on our happiness than we would imagine. Then there is the idea that happy people are healthier.

Ehrenreich agrees that there are scores of studies linking happiness to good health, but points out that these are rarely causal. It is almost impossible to establish which comes first – health or happiness. She also digs out alternative research that seems to show that mild pessimism can lead to greater longevity, and that optimism can be dangerous to life and limb. The evidence, she says, just isn't cut and dried.

It may be that more advanced research refines positive psychology. Ehrenreich interviewed Martin Seligman for her book, and he told her that, "New evidence shows that paraplegics and the unemployed 'do not go back to where they were'" in terms of happiness after they adjust to their lives being shattered. In other words, the big C for circumstance in his equation comes in higher than was originally thought. Well, what a surprise. Next they'll be admitting that millionaires are happier than the rest of us.

For me, happiness theory belonged to the boom years when people were bilious with consumption and needed some sort of moral supernanny to reset the compass. But that's all over now and, like the proud pessimist I am, I can confidently predict that it is all going to get a lot worse. Now there's a thought to perk you up.