Blog #5: A Heck of a Way to Measure "Progress"

Recently, in this space, Stephen introduced us to the concept of the Anthropocene – the emerging geologic epoch that is replacing the Holocene, the epoch that we all learned about in school as the “current one.”  While the Holocene is defined as the period following the end of the last ice age starting about 11,700 years ago, the Anthropocene is characterized as the time on our planet when the cumulative actions of our species, not astronomical cycles, volcanism, plate tectonics or the like, are the dominant driver of Earth’s systems: its climate, bio-geochemical cycles and material flows. 

In that entry, Stephen maintained that the discovery and exploitation of fossil fuels provided the energy source behind the awesome surge in human activity that has given birth to the Anthropocene, and went on to say that “sustained economic growth became the unifying goal of powerful new international institutions, all national governments, and businesses of every size, supported by an unquestioningly supportive public.”  Well, the time has past arrived to deeply question “sustained economic growth” as the unifying goal for our institutions.  The renowned environmental economist Robert Costanza, and colleagues, argue just this in an important new Comment piece in Nature entitled “Time to leave GDP behind.”

While “sustained economic growth” has become the unquestioned goal of our institutions, Gross Domestic Product (GDP) growth has become the equally unquestioned metric for how we assess progress toward it.  Perhaps an argument can be made that GDP was a useful measure of human progress when it was introduced in the wake of World War II, its inadequacy is starkly apparent today, yet it remains firmly entrenched.  Just think of every unquestioning news report you have ever heard, from media and elected officials on the right to the left, blindly parroting the “fast GDP growth equals GOOD, slow GDP growth equals BAD” dogma.  The holiday shopping season is a failure if this year’s churn of material consumption fails to exceed the previous.  Constanza et al. note that famed economist John Kenneth Galbraith once quipped “To furnish a barren room is one thing.  To continue to crowd in furniture until the foundation buckles is quite another.”  

But not only does GDP fail to question the sheer fallacy of ever-expanding consumption, it credits in its accounts spending and activity that can only be understood as counter to human welfare.  The explosion of economic activity that arose along the Gulf Coast to deal with the Deepwater Horizon blow-out?  All “positive” contributions to US GDP.  Indeed, if every redwood tree in America were cut and sold as timber next year, the economic activity would be “logged” on the positive side of the GDP ledger, yet there is nowhere in its calculus to account for the barren, muddy slopes left behind.  Robert Kennedy eloquently expressed these shortcomings of GDP inremarks at the University of Kansas all the way back in 1968: “It measures neither our wit nor our courage; neither our wisdom nor our learning; neither our compassion nor our devotion to our country; it measures everything, in short, except that which makes life worthwhile. And it tells us everything about America except why we are proud that we are Americans." 

As GDP had become the metric of choice for almost every nation on Earth, its shortcomings are manifest equally across the globe.  Governments – and their citizens - everywhere have been fallen into the trap of thinking that crowding ever more furniture into well-furnished rooms will somehow make us more fulfilled.  This is not to deny that billions still live in barren rooms that must be furnished, but the goal must be pursued with a clearer concept of what truly delivers human wellbeing rather than raw GDP growth.  GDP growth has become sound and fury signifying nothing.  We can do better.

Constanza and colleagues explain that a window currently exists to deeply question the merit of GDP as a metric of our collective “success” as a species.  In 2015 the United Nations will be releasing an important set of new Sustainable Development Goals (SDG).  The process of drafting these goals will involve the collaboration of academics and government officials from around the world, and will provide a perfect forum to debate the merits and demerits of GDP as a widely used metric.  As Costanza et al. point out, a host of alternatives have been developed, including the Genuine Progress Indicator, the Happy Planet Index, the Better Life Index and more.  All seek to create a more holistic accounting of what matters, what should count and what should not. Whether or not GDP dies its long-overdue death during the United Nations SDG process or elsewhere, I urge you, every time you hear the unquestioned dogma of GDP growth being advanced, to think about what this flawed index is actually measuring.