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from Natural Life Magazine,
March/April 2009 Traditionally, a country’s economic health and well-being is measured by something called the Gross Domestic Product (GDP) or its cousin, the Gross National Product (GNP). The media eagerly report the number on a monthly basis and its rise or fall is used as an indicator of how well things are progressing or not. A recession, for instance, is defined as two consecutive quarters of negative GDP growth. But GDP is really just a measure of national spending with no distinctions between transactions that add to well-being and those that diminish it. As long as money changes hands, the GDP increases. The fact that this indicator is based upon economic growth is not surprising. The collection of the statistics underlying GDP and GNP, which is called the System of National Accounts (SNA), was created in the United States in the 1930s to kick start the economy out of the Great Depression by maximizing production and consumption of manufactured goods in a wartime economy. Seventy-some years later, however, the GDP’s faith in unbridled growth and efficiency is not as useful. Our current worldwide economic and environmental crises suggest that we need a new definition of progress and a new way of accounting for the costs generated by economic activity. For instance, under the GDP, environmental pollution ends up being a positive because it creates economic activity – and is even counted positively twice: once when it’s created and again when it’s cleaned up. And the result of that pollution, which is often illness such as cancer, also ends up on the plus side of the ledger because it, too, creates economic activity... To read the rest of this article, subscribe to Natural Life's online edition. Wendy Priesnitz is Natural Life magazine's editor. Visit her website and read her blog. |
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