Mike Miller asked:
>Misha, is Redefining Progress the group that developed the Genunine
>Progress Indicator, GPI, that counts the costs associated with say cancer
>or automobile accidents as a negative number instead of adding them to the
>GNP/GDP which defines them as "growth" and therefore "a good thing"
>economically speaking for the economy? Mike Miller
Yes, Mike, that's us. RP's purpose as an organization is to stimulate
public debate over the nature of economic progress and the best means of
attaining it. We take it as a given that a growth- and consumption-based
model of progress provides perverse incentives for resource destruction and
unsustainability in general.
The Genuine Progress Indicator, GPI, is our flagship program; many people
remember reading about this in the October, 1995, issue of /The Atlantic
Monthly/ ("If the Economy Is Up, Why Is America Down?"). See:
Reprints of that article can be ordered from us.
Redefining Progress updates the GPI annually; the last one was in November
http://www.rprogress.org/pubs/gpi1999/gpi1999.html (HTML and PDF versions
The Genuine Progress Indicator calculates and includes the value of
benefits currently ignored by the GDP, such as the value of housework and
parenting, the value of volunteer work, services of consumer durables,
services of highways and streets, and net capital investment.
The GPI also subtracts from the GDP
1. Economic costs (the widening gap between the rich and the poor, the
future costs of borrowing from foreign countries to pay for consumption,
and the cost of consumer durables)
2. Social costs (crime, automobile accidents, commuting, family breakdown,
loss of leisure time, and underemployment)
3. Environmental costs (costs of household pollution abatement, water
pollution, air pollution, noise pollution, loss of wetlands, loss of
farmland, depletion of non-renewable resources, long-term environmental
damage, ozone depletion, old growth forest destruction, and anything that
pollutes or depletes the stock of natural resources).
So, for instance:
--More than $100 billion was spent on addressing water, air, and noise
pollution. This was considered growth by the GDP.
--Foreign lending accounted for $238 billion of the GDP--but this is really
debt for future repayment, so how can it be a measure of progress?
--The costs of crime (replacement of stolen goods, purchase of home
security systems, building of prisons) amounted to $28 billion--yet were
chalked up to the GDP as growth.
--How about the fact that six million American children under age 12 are
taking Prozac or other anti-depressants--these drug sales are contributing
over $1 billion to the GDP. This is happening at a time when America's
increasingly obese, sedentary, and depressed children are spending $24.4
billion on junk food, cigarettes, liquor, drugs, toys, and other consumer
products. Did I mention that youth suicide has tripled since 1950, and
bankruptcy by people under 25 has grown 50% since 1991?
--The food industry spends $10 billion a year in direct advertising and
another $20 billion on coupons, games, and gimmicks trying to convince
Americans to add new food products--and calories--to their diets. This is
because, as Marion Nestle pointed out, the food industry produces enough
food to supply 3,800 calories per day to every American. Yet the average
woman needs only 2,000 calories a day, the average man, 2,500, and children
much less. As a result of the marketing of this surplus, one in three
American adults (58 million) is overweight. Ah, but then Americans turn
around and spend $30 billion on diet products! This $60 billion
contribution to the GDP results in serious health problems. Should
overeating, then dieting, liposuction, and the development of eating
disorders be considered progress?
--And then there's the loss of old growth forests, farmland, wetlands, and
other environmental degradation. Like I need to tell you all.
My point here is NOT to overwhelm you with bad news--yimminy, those of us
in sustainable ag live with bad news, and do it constructively. My point is
to hang some facts onto our sound bite: "Progress is more than money
The GDP is, like any indicator, a construct. The point of the GPI is to let
people see the big disconnect between what the government is tracking, what
the politicians are calculating, what the media are reporting--and what
Americans are experiencing.
By our calculations, while the GDP rose from $20,310 per capita in 1980 to
$27,939 per capita in 1998, the GPI fell from $8,722 to $6,649 during the
same period. And what do you think the experience of just plain citizens
has been? The boom has passed them by--and they know it. It doesn't matter
how many dot-com tycoons you read about or programs you see on TV like "So
You Want to Marry a MultiMillionaire." As the media pound away with their
bass drum message of economic boom, it's the highest income earners in
America who have benefited from the growth of the GDP. So that, from 1975
to 1998, the proportion of total income received by the poorest fifth of
the population dropped from 4.4% to 3.6%, while the proportion received by
the richest fifth increased from 43.2% to 49.2%.Yet work hours are steadily
climbing, leisure time eroding, and the work of shopping, cooking,
clearning, childcare, and household upkeep (generally women's work) is
Hey, but you knew all that. :^)
To point back to my earlier message of today--that bulldozed community
garden in New York City will at some point be tallied as economic growth
for the city. And the losses will be ignored--the destruction of community,
of productive greenspace, of food production, and more.
Now, having said all that, RP does more than the GPI. In fact, that fits
with just one of our four program areas. I'll have more to say about the
others as time goes by.
One Kearny St., fourth floor
San Francisco, CA 94108
I prefer a rude vigor to a common banality. --Utah Phillips
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