If the GDP is Up, Why is America Down? is a 1995 article from The Atlantic, a still-relevant eye-opener about the consequence of the United States' commitment to Gross Domestic Product (GDP) as the measure of economic well-being. The authors say that GDP is an abstract measure of the movement of money within the economy, ignoring value that isn't or can't be monetized, and looking at the absolute value transactions without evaluating their positive or negative social or environmental impact. They argue that the GDP approach to the measurement of economic health has deleterious side effects, such as the transformation of people into statistical consumers who replace social and familial experience with canned entertainment and fast food, and the acceptance of ecological destruction because it contributes to the size and weight of the bottom line. They suggest a different measure, the "genuine progress indicator" (GPI):
The GPI includes more than twenty aspects of our economic lives which the GDP ignores. We based this list on available data and on common sense. A family does not count every dollar spent as a step forward. Rather, it tries to sort out the different kinds of expenditures--and that's basically what we did with the national accounts. We started with the same consumption data that the GDP is based on, but revised them in a number of ways. We adjusted for some factors (such as income distribution), added certain others (such as the value of housework and community work), and subtracted yet others (such as pollution costs and the like). The result is a balance sheet for the nation that starts to distinguish between the costs and benefits of "growth."Of course, our friends at Redefining Progress are all over the GPI concept.
(Thanks to John Quarterman for the pointer!)
