In the News (from ABC Net): “In a commentary piece in this week’s Nature, Dr Robert Costanza, chair in Public Policy at ANU, and his colleagues argue that GDP should be replaced with a more sophisticated metric that represents a more comprehensive account of a nation’s economic well-being. …
“Whatever you think it is that makes life worth living, as Robert F Kennedy pointed out in 1968, it’s almost a sure bet that it isn’t measured by Gross Domestic Product, or GDP.
GDP simply measures a nation’s raw economic activity in terms of production and consumption. It makes no attempt to factor in the depletion of natural resources or the degradation of the environment. It cares not for income inequality and all the ills that come with it. It doesn’t pretend to discriminate between beneficial economic activity (new infrastructure, investment in education, disease prevention, etc) and negative activity (the cost of crime, pollution, etc). And it entirely ignores whole swathes of fruitful activity, such as housework or volunteering in the community.
“One sign of how destitute GDP is as a metric of well-being is that it tends to go up after a natural disaster. Reconstruction and remediation spur intense activity that is registered by GDP, while the destruction, lives lost, suffering and disruption to families and communities in the wake of a flood, cyclone or bushfire are ignored.
“One of the frontrunners to replace GDP is the Genuine Progress Indicator (GPI). It was proposed in 1989 and has been developed since to accurately measure not just economic activity, but also how that activity impacts the well-being of individuals living in that economy, and how sustainable that activity is.
“It effectively uses GDP as its foundation, but then scrutinizes economic activity in more detail, making subtractions for negative activity and adding in beneficial activity that is overlooked by GDP. …
“It also factors in the environment, in terms of the cost of pollution, the loss of wetlands and farmland, the depletion of natural resources and the emission of carbon dioxide. It also takes account of the cost of crime, not only in terms of direct impacts, but also the cost of policing, prisons and even the amount of money spent on locks and alarms.
“GPI isn’t the only alternative to GDP, but it is one of the most respected by economists and public policy experts around the world. The question now is: what’s stopping us from adopting it?
“’It’s going to take some therapy to make the transition to a sustainable economy that isn’t based on growth or GDP but on improvement of well-being,’ Costanza said.
“While the unbridled pursuit of GDP growth has not done much to increase our well-being over the past few decades, it has been a triumph for big business and the finance sector, i.e. those who disproportionately benefit from raw economic activity. Not surprisingly, as a result of this windfall, these sectors – and the politicians who serve them – are likely to resist any move to a more comprehensive metric of national economic well-being.”
My Comment: No matter what is measured or how what is important is the principle, the purpose of development, for what? It is necessary to curb appetites, take from nature only what is needed, and use our free time to re-educate humanity. Otherwise, we are heading to a looming confrontation with nature, which will be reflected in all aspects of our life.
Usually people understand nature of the world around us at the levels of the still, vegetative, and animate, and exclude ourselves from this definition. This is our fault; after all, we are also under the control of nature and under its laws. We use these laws erroneously, harm ourselves, and use the intelligence that was given to us against ourselves. Kabbalah warns of the impending retribution for our disregard of nature.