Moving beyond the Gross Domestic Product

Being a classically trained economist, I’ve always recognized that one of the biggest problems with the old adage with “you can manage only what you measure” is the corollary that it is “what you measure, matters.”

For decades, nations have measured their progress through the horrible proxy yardstick that is the GDP or GNP, currently the Gross Domestic Product. I’m a huge fan of alternative measurement systems that include other measurements to get a true grasp of a nation’s progress and strength. Mostly because of a famous speech by Robert Kennedy which just passed its 40th anniversary this past week.

The Glaser Progress Foundation presented the video below but the in tandem with this, Senator Dorgan in the US has also been holding congressional committees about forcing the Commerce Department to adopt “satellite accounts” in addition to GDP that were recommended by the National Academy of Sciences (that, unsurprisingly, were stopped from being adopted by the Bush administration). Anyhow, inspirational video. Check it out.

Transcripted and removing the specifically about the US stuff :

For too long we seem to have surrendered personal excellence and community value in the mere accumulation of material things.

Our gross national product now is over 800 billion dollars a year, but that… gross national product counts air pollution, and cigarette advertising, and ambulances to clear our highways of carnage. It counts special locks for our doors and the jails for people who break them. It counts the destruction of the redwoods and the loss of our natural wonder in chaotic squall.

It counts napalm, and it counts nuclear warheads, and armored cars for the police to fight the riots in our city. It counts Whitman’s rifles and Speck’s knifes and the television programs which glorify violence in order to sell toys to our children.

Yet, the gross national product does not allow for the health of our children, the quality of their education, or the joy of their play.

It does not include the beauty of our poetry or the strength of our marriages, the intelligence of our public debate or the integrity of our public officials.

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 worth while.

Seriously, does anyone have a defence for still measuring national progress exclusively under GDP anymore other than the typical hand-wringing and arguing over how it should be augmented or replaced ? Would it even matter to try a couple of different measurement systems simultaneously to see what could be accomplished or makes sense ?

(via WorldChanging)