WASHINGTON (Bloomberg) — The US is risking its economic prosperity by failing to properly measure its successes, in areas from grade-school testing to the balance of foreign trade, a corporate advocacy group warned.The Council on Competitiveness, issuing its first global “competitiveness index” since 2001’s recession, said the US economy’s resilience in the past five years demonstrates the nation’s global dominance.

Yet US policy makers still have a poor grasp of what factors are most responsible for that success, the Washington-based council said.

Education and scientific expertise are important; creativity and flexibility are among qualities that should be equally cherished as the global economy grows, it said.

“Unless we take account of these changes, an outdated framework will serve as the implicit guide of many of today’s most vehement debates,” in areas such as trade, education, research funding and job creation, the council said.

The council is an alliance of corporate, labor and educational groups whose 130 members include Wal-Mart Stores Inc., Microsoft Corp. and Harvard University.

The index it released today has a host of statistical good news for the US economy. The US standard of living is the highest in the world, and the US economy has grown faster than any other major developed economy over the past decade, it said.

Without understanding the real reasons for its global dominance, however, the US may not stay on top, the council said.

In economic policy, the government should take steps such as measuring foreign trade balances that include intellectual property, brand reputation and other “intangibles,” said the council’s president, Deborah Wince-Smith.

That could help policy makers better understand the cost of regulations such as the Sarbanes-Oxley corporate governance and accounting law, which has “had a very detrimental effect in pushing our potentially high-growth, game-changing companies to go outside of the US for initial public offerings,” she said.

In education policy, the council’s findings suggest that test-based standards imposed on grade schools by the federal government should do more than just measure traditional academic skills such as math and reading, Wince-Smith said.

US schools do need to focus on maths and sciences, she said.

“But what we also want to recognise and nurture is our children to be exposed to art and music and socialisation and creativity and all the team-work that is embedded in our culture,” she said.

The US doesn’t necessarily need to fear facts such as China graduating 600,000 engineers a year, compared with 70,000 in the US, said Wayne Clough, president of the Georgia Institute of Technology and a vice chairman of the competitiveness council.

“China is producing 600,000 people who have some connection to technology,” Clough said.

The US engineers, by comparison, are far more capable of working in today’s economic environment, and therefore far more valuable, he said.

That’s not grounds for complacency, as the US does need more home-grown engineers, Clough said. At the same time, policy makers should understand the US needs engineers with multiple talents, who can adapt as society and technology changes, he said.

“It would be a disaster for this country to produce a whole bunch of new engineers who in ten years would be out of a job and would have no idea about how to translate those skills into the next wave,” he said.

Government policy makers who kept better track of the true economic values of such skills would fund a better variety of educational offerings, from grade school through graduate school, Clough said.

The council plans next year to begin working to develop those improved statistical measures, along with government agencies such as the US Commerce Department and the 30-nation Organisation for Economic Cooperation and Development, Wince-Smith said.