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Forum Post: US Ranks 114th on Happy Planet Index. Why do we still use GDP?

Posted 2 years ago on Dec. 27, 2011, 4:08 a.m. EST by JadedCitizen (4277)
This content is user submitted and not an official statement

GDP per capita is not a measurement of the standard of living in an economy. However, it is often used as such an indicator, on the rationale that all citizens would benefit from their country's increased economic production. Similarly, GDP per capita is not a measure of personal income. GDP may increase while real incomes for the majority decline.

The major advantage of GDP per capita as an indicator of standard of living is that it is measured frequently, widely, and consistently.

The major disadvantage is that it is not a measure of standard of living. GDP is intended to be a measure of total national economic activity—a separate concept.

GDP counts work that produces no net change or that results from repairing harm. For example, rebuilding after a natural disaster or war may produce a considerable amount of economic activity and thus boost GDP. The economic value of health care is another classic example—it may raise GDP if many people are sick and they are receiving expensive treatment, but it is not a desirable situation.

Should we be demanding alternatives to GDP?

5 Excellent Alternatives to the Archaic GDP Measuring Stick

Genuine Progress Indicator

Quality of Life Index

The Legatum Prosperity Index

The Happy Planet Index 2.0

Human Development Index

http://newsjunkiepost.com/2011/05/04/the-top-5-prosperity-measuring-sticks-more-accurate-than-gpd/

78 Comments

78 Comments


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[-] 3 points by beautifulworld (20798) 1 year ago

Interesting. And, it has been proven that happiness levels off after a certain amount of income, somewhere around $75,000 per year.

[-] 3 points by Mattholck (51) 2 years ago

other indexes

work hours

life expectancy

infant mortality rate

emergency room visits

violent crime

number jailed per capita

[-] 2 points by JadedCitizen (4277) 2 years ago

and some more indexes

Index of Sustainable Economic Welfare, which factors in both pollution and income distribution

Genuine Progress Indicator, which tries to determine if economic growth has improved a country’s welfare

Happy Planet Index (sounds a bit goofy), which measures human well-being and environmental impact. U.S. ranks 114th on this list btw.

[-] 1 points by 99PercentFriendly (31) 2 years ago

We need an index that shows how evolved we are.

Not a measure of industrial development or materialistic dependency, but an index that shows how free spirited and intellectually advanced a society is.

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[-] 1 points by JadedCitizen (4277) 2 years ago

How can you measure free spirited?

[-] 1 points by 99PercentFriendly (31) 2 years ago

Do people think for themselves and are they free to express their thoughts, or are they told what to think and how to live their lives by the one percent. How much Respect for free speech and universal human rights there is in a society is a good measurement as to how free spirited the people in that society are.

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[-] 1 points by JadedCitizen (4277) 2 years ago

How can you measure respect? Don't get me wrong, I get what you mean. But you have to be able to quantify it somehow. It can't be opinion based. It needs to be determinative based on something you can count. My height can be measured by units of inches and everybody can agree on that standard unit of measurement.

[-] 1 points by 99PercentFriendly (31) 2 years ago

The number of people killed, tortured, suppressed, and the number of lives that are derailed or otherwise destroyed at the hands of the one percent is quantifiable.

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[-] 1 points by JadedCitizen (4277) 2 years ago

Sure. But I would rather keep the discussion broader and inclusive. There may be some in the 1% who might have something positive to add to this.

[-] 1 points by 99PercentFriendly (31) 2 years ago

The individual members of the one percent come and go and there might be some of them who have good intentions, but the collective entity that they represent continues to take us and this planet down the path of destruction.

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[-] 1 points by JadedCitizen (4277) 2 years ago

You're right.

[-] 1 points by divineright (664) 2 years ago

Free spirit may be hard to measure, but we could examine the extent to which lifestyle choices are legislated against.

[-] 2 points by JadedCitizen (4277) 2 years ago

That is a quantifiable way. We are what we count.

[-] 1 points by Mattholck (51) 2 years ago

thanks

er..

number of people on facebook

[-] 1 points by JadedCitizen (4277) 2 years ago

er....

300 million.

[-] 1 points by Mattholck (51) 2 years ago

the us population is 300 million

[-] 1 points by JadedCitizen (4277) 2 years ago

300 million worldwide. my bad.

[-] 1 points by Mattholck (51) 2 years ago

going to bed

[-] 1 points by JadedCitizen (4277) 2 years ago

5 Excellent Alternatives to the Archaic GDP Measuring Stick

Genuine Progress Indicator

Quality of Life Index

The Legatum Prosperity Index

The Happy Planet Index 2.0

Human Development Index

http://newsjunkiepost.com/2011/05/04/the-top-5-prosperity-measuring-sticks-more-accurate-than-gpd/

[-] 2 points by flip (6795) 2 years ago

you are on track - thanks for pushing this line - the way we look at the economy is completely fucked and at the heart of our problems. not sure if i sent this to you before but here is max neef - AMY GOODMAN: What do you think needs to change? You’re saying it’s obvious, but what do you think needs to happen that they’re avoiding?

MANFRED MAX-NEEF: Well, to begin with, a completely new concept of economics. This economy is crazy and poisonous. I am an economist, and I have been fighting against the economy that is taught the way it is being taught and being practiced. I have been fighting it for almost 40 years of my life, because it’s an absurd economy that has nothing to do with real life. It’s all fabrications, no? If the model doesn’t work, it’s not because the model is wrong, but because reality plays foul tricks. And reality is there to be domesticated, you know, and become the model. That is the attitude. And that’s systematic, in addition.

What is the economy that is being taught in the universities today everywhere? Neoclassical economics. Neoliberalism is an offspring of neoclassical economics. And neoclassical economics is 19th century. So we are supposed to solve problems of the 21st century that have no precedent with theories of the 19th century. We no longer have a physics of the 19th century, nor a biology, nor an engineering — nor nothing. The only thing in which we stopped in the 19th century is in the concept of economics. I mean, and that is elementarily absurd. And the main journals and everything, you know — I mean, no, no, that’s the way it must be.

AMY GOODMAN: So, to avoid another catastrophe, collision, if you were in charge, what would you say has to happen?

MANFRED MAX-NEEF: Well, first of all, well, I would dramatically change, you know. For me, the problem begins in the university. The university is, for me, the main responsible for this. The university today has become an accomplice of maintaining a world which we don’t want, because if you don’t teach something different to the economists, well, how the hell are you going to change it when they are professionals, you know, working? It’s impossible. When I started economics in the early '50s, it was totally different. We had some fundamental courses like economic history, history of economic thought. Those courses don't exist in the curricula anymore. You don’t have to know the history. It’s not necessary. It’s not necessary that you know what previous economists ever thought. That’s not necessary. You don’t need it. I mean, that’s even stupid arrogance, you know. No, now we know for sure this is it forever, you know? Then it ceases to be a discipline, it ceases to be a science, and it becomes a religion. And that is what economics, neoliberal economics, is today.

So, first of all, we need cultured economists again, who know the history, where they come from, how the ideas originated, who did what, and so on and so on; second, an economics now that understands itself very clearly as a subsystem of a larger system that is finite, the biosphere, hence economic growth as an impossibility; and third, a system that understands that it cannot function without the seriousness of ecosystems. And economists know nothing about ecosystems. They don’t know nothing about thermodynamics, you know, nothing about biodiversity or anything. I mean, they are totally ignorant in that respect. And I don’t see what harm it would do, you know, to an economist to know that if the bees would disappear, he would disappear as well, because there wouldn’t be food anymore. But he doesn’t know that, you know, that we depend absolutely from nature. But for these economists we have, nature is a subsystem of the economy. I mean, it’s absolutely crazy.

And then, in addition, you know, bring consumption closer to production. I live in the south of Chile, in the deep south. And that area is a fantastic area, you know, in milk products and what have you. Top. Technologically, like the maximum, you know? I was, a few months ago, in a hotel, and there in the south, for breakfast, and there are these little butter things, you know? I get one, and it’s butter from New Zealand. I mean, if that isn’t crazy, you know? And why? Because economists don’t know how to calculate really costs, you know? To bring butter from 20,000 kilometers to a place where you make the best butter, under the argument that it was cheaper, is a colossal stupidity, because they don’t take into consideration what is the impact of 20,000 kilometers of transport? What is the impact on the environment of that transportation, you know, and all those things? And in addition, I mean, it’s cheaper because it’s subsidized. So it’s clearly a case in which the prices never tell the truth. It’s all tricks, you know? And those tricks do colossal harms. And if you bring consumption closer to production, you will eat better, you will have better food, you know, and everything. You will know where it comes from. You may even know the person who produces it. You humanize this thing, you know? But the way the economists practice today is totally dehumanized.

AMY GOODMAN: And if you’re teaching young economists, the principles you would teach them, what they’d be?

MANFRED MAX-NEEF: The principles, you know, of an economics which should be are based in five postulates and one fundamental value principle.

One, the economy is to serve the people and not the people to serve the economy.

Two, development is about people and not about objects.

Three, growth is not the same as development, and development does not necessarily require growth.

Four, no economy is possible in the absence of ecosystem services.

Five, the economy is a subsystem of a larger finite system, the biosphere, hence permanent growth is impossible.

And the fundamental value to sustain a new economy should be that no economic interest, under no circumstance, can be above the reverence of life.
[-] 1 points by JadedCitizen (4277) 2 years ago

AMY GOODMAN: While President Obama is reporting looking into tapping a former corporate executive to become his next top economic adviser, many economists question the path the United States is on. Last week, during our trip to Bonn, Germany, I had a chance to speak with the acclaimed Chilean economist Manfred Max-Neef. He won the Right Livelihood Award in 1983, two years after the publication of his book Outside Looking In: Experiences in Barefoot Economics. I began by asking him to explain what barefoot economics is.

MANFRED MAX-NEEF: Well, it’s a metaphor, but a metaphor that originated in a concrete experience. I worked for about ten years of my life in areas of extreme poverty in the Sierras, in the jungle, in urban areas in different parts of Latin America. And at the beginning of that period, I was one day in an Indian village in the Sierra in Peru. It was an ugly day. It had been raining all the time. And I was standing in the slum. And across me, another guy also standing in the mud — not in the slum, in the mud. And, well, we looked at each other, and this was a short guy, thin, hungry, jobless, five kids, a wife and a grandmother. And I was the fine economist from Berkeley, teaching in Berkeley, having taught in Berkeley and so on. And we were looking at each other, and then suddenly I realized that I had nothing coherent to say to that man in those circumstances, that my whole language as an economist, you know, was absolutely useless. Should I tell him that he should be happy because the GDP had grown five percent or something? Everything was absurd.

~~I agree completely. It's absurd.~~

[-] 1 points by flip (6795) 2 years ago

i think he is really good - pointing out the obvious flaws in economic theory. he also makes the point correctly that economics is our new religion - drives policy so we need to understand it well in order to change the system in a meaningful way

[-] 1 points by JadedCitizen (4277) 2 years ago

No doubt. His asset is an ability to weigh the importance of things and put them in proper context, and when you do that, the right questions get asked.

People vs. Money, which is more important? Why should money more be more necessary than the human beings that use it? It should be remembered that currency is a tool created by people. It should remain a necessary component of a developed economy to hold the wood together. Still, currency should only be useful, like a screwdriver, and not the holy grail of life.

In other words, when people become subservient to the tools they create, they are becoming like 'tools'.

[-] 1 points by JadedCitizen (4277) 2 years ago

Yes, you did, during my first week on here.

What needs to change? It only occurred to me the other day that no one could really answer me when I asked them what the goal of capitalism is. That led me to search for that answer - GDP. Which does nothing to measure anything I give a damn about.

This is obvious - well-being and long-term sustainability should be the goals.

Avoiding? Finite growth, I suppose.

[-] 0 points by factsrfun (7033) from Phoenix, AZ 2 years ago

Thanks for adding to this line, the CIA website even has things like life expectancy and infant mortillty, that are usefull.

[-] 2 points by JadedCitizen (4277) 2 years ago

If we measure America by GDP, we are the wealthiest nation in the world. But it is not at all representative of our overall prosperity. We should also take into account an,

Income Index

[-] 0 points by factsrfun (7033) from Phoenix, AZ 2 years ago

I'm not sure we even have the highest per capital GDP anymore. "Confession of an Ecoomic Hit Man" talks at lenght about the falicy of GDP, mostly in regaurds to measuring how much we "helped" other nations. Spoiler alert: we did it by making a FEW people very rich.

[-] 2 points by JadedCitizen (4277) 2 years ago

We may not, I'm not sure. But anybody defending America, or the sacred cow that is capitalism in general, will tell you capitalism produces the greatest wealth anyone has ever witnessed before and does more to lift people out of poverty than any other system. It seems rather evident to me this is a false claim. "C of an EHM", is that a book?

[-] 0 points by factsrfun (7033) from Phoenix, AZ 2 years ago

Oh and yes it's a book, by a guy who made his living for many years going into countries and convincing them to go into unsustainable debt.

[-] 0 points by factsrfun (7033) from Phoenix, AZ 2 years ago

I too believe a number of claims are suspect, but "ends" and "means" being ethical debates and whatnot, I'm not sure I care. What I do care about is having a strong country and decent life for me and family and if that means mixing in a little "socialism" I'm ok with that.

[-] 2 points by JadedCitizen (4277) 2 years ago

Me too.

[-] 1 points by JadedCitizen (4277) 2 years ago

GDP rat race.

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[-] 1 points by DYLANDIRT (44) 2 years ago

grand daddy purple

[-] 1 points by JadedCitizen (4277) 2 years ago

It sounds like English, but I can't understand a word you're saying.

[-] 1 points by hchc (3297) from Tampa, FL 2 years ago

Spoiled Brats we are...

[-] 1 points by JadedCitizen (4277) 2 years ago

As much as I hate to agree with you, I have to agree with you....

[-] 1 points by hchc (3297) from Tampa, FL 2 years ago

Why would you hate to agree with me? I bash both parties :)

[-] 1 points by JadedCitizen (4277) 2 years ago

Because it's funner being disagreeable. And who likes to be reminded we're spoiled brats, even if it is true.

[-] 1 points by JadedCitizen (4277) 2 years ago

GDP rat race.

[-] 1 points by DKAtoday (28288) from Coon Rapids, MN 2 years ago

This is why we are here this is why you are needed.

http://occupywallst.org/forum/inside-job-documentary/

Share, circulate, educate, inspire.

[-] 1 points by JadedCitizen (4277) 2 years ago

Great documentary. It should be mandatory viewing.

[-] 1 points by DKAtoday (28288) from Coon Rapids, MN 2 years ago

It really is. I'm trying to push it viral. Great education for the 99% of the world.

[-] 1 points by JadedCitizen (4277) 2 years ago

Somebody should make a shorter version if you really want it to go viral.

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[-] 1 points by JadedCitizen (4277) 2 years ago

You lost me. What does the name of congress have to do with GDP?

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[-] 1 points by JadedCitizen (4277) 2 years ago

No, I'm not looking at archaic terms, I'm looking at archaic practices.

Congress means the national legislative body of the US. They seem to be doing a fine job of legislation (NDAA, SOPA, etc.), just not on behalf of their non-adoring public or their inability to pass a damn thing. .

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[-] 1 points by JadedCitizen (4277) 2 years ago

Corpress is nice, But no, I think they got it right to begin with. The 'con' in the word congress describes their behavior to a 'T'.

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[-] 2 points by JadedCitizen (4277) 2 years ago

Damn shame.

[-] 1 points by FriendlyObserverA (610) 2 years ago

114 th seems terribly low for a nation that has everything ?

[-] 1 points by JadedCitizen (4277) 2 years ago

Well, a few of the nation anyway.

[-] 0 points by FriendlyObserverA (610) 2 years ago

On another thread I was asked to prove what I had commented about personal interest being a stronger motivator than financial incentive. I was arguing equal pay would allow for everyone to decide on a career without having financial incentive as part of the equation. And believing persons would achieve greater happiness.

With this happy planet index would equal pay improve the rating ?

[-] 1 points by JadedCitizen (4277) 2 years ago

The Global HPI incorporates three separate indicators: ecological footprint, life-satisfaction and life expectancy.

Conceptually the HPI is straightforward. It is an efficiency measure: well-being delivered per unit of environmental impact.


What I gather (looking at their website) is that the US is among the least efficient countries at delivering well-being to its citizens per unit of environmental impact. I can't say it makes an argument for equal pay, but it certainly makes a statement about how inefficient and wasteful the US is.

[-] 0 points by FriendlyObserverA (610) 2 years ago

The western world is a rat race. We work our lives away without a moment to spare. Never seeming to have enough. Leaving a terrible wake of destruction. It's called Freedom !

[-] 1 points by JadedCitizen (4277) 2 years ago

It's important to step back and look at the big picture without bias. There is nothing wrong with the concept of freedom in and of itself. Nor is there anything with the concept of equality in and of itself, though some may argue that we will never truly be equal (as I know you've experienced), there is nothing wrong with the ideal . The real problem lies in how we conceptualize and interact with the ideas of freedom or equality. In other words the goals we set to meet those ideals.

That's why I feel it is so important to bring up the the measurements of our societies. The direction we travel depends on the destination we set for ourselves. GDP tells us to do nothing more than keep producing, keep producing, and produce some more. More, more, more gross domestic products grows the economy.

Does that goal foster freedom & equality? No, it fosters a rat race, so we need new measurements that reflect what we really want to achieve.

Currently, freedom is associated with accumulating wealth, we need to make a new association - maybe our idea of freedom should be to spend less time chasing wealth and enjoying life.

By your ideals, equality is associated with equal pay, how else can it be associated or conceptualized and measured? stretch your thinking...

I've always considered respect a measure of equality myself (which is thoroughly lacking in this drastic income gap world I find myself in). In other words, I don't care if a brain surgeon makes more than me as long as he gives me equal respect.

[-] 0 points by FriendlyObserverA (610) 2 years ago

The big picture is multidimensional.

I've been stretching my mind.

GDP may be an indicator of a nations wealth. But somehow the markets manage to take that wealth from the nation , leaving a huge debt in both government and public sectors. Which creates that never ending rat race.

[-] 1 points by JadedCitizen (4277) 2 years ago

The practical, fundamental problem is the goal of growth, not the ideal goals of equal pay or equal opportunity.

Ideals, by their very nature are difficult to achieve because they are the optimum, or ideal, situations & outcomes we strive for.

Ideally, I would like to be happy every moment of my life, but it is improbable for all sorts of reasons, car breaks down, someone dies, etc.

Ideally, I would like to be completely free and do whatever I want, like soar through space and go visit other planets, but I am limited and constrained by the reality that I can't fly on my own power into space like Superman and our technology is not advanced enough for me to go Star Trekking in a spaceship.

So, it is necessary & worthwhile to strive toward ideals, but actual goals must be practical and attainable.

Like limiting growth. and focusing on development.

MANFRED MAX-NEEF: Growth is a quantitative accumulation. Development is the liberation of creative possibilities. Every living system in nature grows up to a certain point and stops growing. You are not growing anymore, nor he nor me. But we continue developing ourselves. Otherwise we wouldn’t be dialoguing here now. So development has no limits. Growth has limits. And that is a very big thing, you know, that economists and politicians don’t understand. They are obsessed with the fetish of economic growth.

http://www.democracynow.org/2010/9/22/chilean_economist_manfred_max_neef_us

[-] 1 points by FriendlyObserverA (610) 2 years ago

The development of civilization has been oppressed by the lack of imagination. Without imagination there is no growth. As you mentioned it is the goals we strive for. There is plenty of technology, plenty of GDP , but greed prevents fair and equal distribution. This is the next hurdle mankind must overcome. It is attainable.
We have come far - we will go further.

[-] 1 points by JadedCitizen (4277) 2 years ago

The necessary leap over that hurdle seems obvious to me. Greed focuses on the goal of growth, creativity focuses on the goal of development.

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[-] 1 points by JadedCitizen (4277) 2 years ago
[-] 0 points by stinkyhippy (-6) 2 years ago

Yea..I'm pretty upset after getting edged out by Niger on the "Happy Planet index"

You fucking loosers...always searching for some poll to confirm your self loathing and how miserable you are

[-] 1 points by JadedCitizen (4277) 2 years ago

I would throw wisdom glue at you, but wise doesn't stick on stupid.

[-] 0 points by factsrfun (7033) from Phoenix, AZ 2 years ago

I love this post great ideas.

[-] 1 points by JadedCitizen (4277) 2 years ago

What do you think should be the goal of capitalism?

[-] 0 points by factsrfun (7033) from Phoenix, AZ 2 years ago

I apologize up front if sometimes my style seems harsh, but capitalism being an economic system does not process motives in my opinion. I’m not pointing this out to be an ass, but I believe that many in the country treat capitalism like a religion and then bend their knee to it as if their own judgment would be a sacrilege to consider. However public policy does have intent, and I firmly believe that public policy should benefit the many if possible without removing all incentive to excel. In general I believe that our country is strengthen when we have policies that result in the vigorous churning of our economy so opportunity and wealth are up for grabs for those that are smart enough and quick enough. I believe that most of our economic problems stem from the fact that so much of our capital has fallen, through inheritance, into weak hands.

[-] 2 points by JadedCitizen (4277) 2 years ago

Don't worry, I don't treat anything as a religion. I'm simply wondering if we are focusing on the wrong goals. Is GDP sacred? It shouldn't be. It should be open to discussion about how effective or ineffective it is and compared to newer ideas that come along. GDP measure production, but who benefits from all that production.

[-] 0 points by factsrfun (7033) from Phoenix, AZ 2 years ago

I think I was on point to this in another response to you, teach me to start two lines, I'm kinda new at this, (but even I know the way to keep control is not to take the bait, sorry troll fighting advice) bottom line is I fully agree with your positon that there are many measures and we should talk about many of them much more, esp. on the airwaves.

[-] 2 points by JadedCitizen (4277) 2 years ago

Spread the word.

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[-] 1 points by JadedCitizen (4277) 2 years ago

No, just bored.

edit: nothing but thrasymaque bashing going on around here.

edit 2: and Ron Paul spammers.

[-] -1 points by SteveKJR (-497) 2 years ago

Hey, if there is a "happier place" that you would like to live - have at it.

[-] 1 points by JadedCitizen (4277) 2 years ago

One planet, to many idiots.