Media Clipping — June 19,1999, The Daily News, Halifax

A Better Measure

By Ronald Colman, Special to the Daily News

Second of two parts

Genuine Progress Index can tell us more than Gross Domestic Product

Yesterday we noted how we have confused economic growth with genuine prosperity and well being. Despite all that, some might say, growth is still necessary to create jobs. Let's look at the evidence.

First, we now know, through hard experience in the ground fishery, that depleting our natural resources in the name of economic growth does not produce more jobs in the long run, but massive unemployment. The national round table on environment and economy recently warned we face a similar prospect in our Maritime forest industry

Secondly growth is increasingly capital driven rather than labourdriven. We have seen continuous and rapid economic growth since the Second World War and a steady increase in Canadian unemployment rates. In Nova Scotia, we have gone from less than 5 per cent unemployment in the late 1960s to an average of 8 per cent in the 1970s, and 12 per cent in the 1980s and 1990s. "Normal" and even "good" employment rates today were completely unacceptable 30 years ago.

And yet, we still link "more jobs" with "more growth." "If" we forgive loans to Michelin, "if" we bring in casinos, "if" we cut a new deal with China, "if" we entice another corporation with a tax break or subsidy, it is said, "then" perhaps we can create (or more likely save) jobs.

HOLLAND: LESS WORK AND MORE JOBS

Instead of making jobs contingent on growth, we might learn from some European countries that have created more jobs by reducing and redistributing the existing workload. The Netherlands, for example, has a 3.4 per cent unemployment rate and also the lowest annual work hours of any industrialised country In that country, parttime work is legally protected, with equal hourly wages and prorated benefits. France has introduced a 35hour workweek. Danes have 5M weeks of annual vacation.

There are intelligent jobcreation strategies that are not dependent on more growth. Sweden has generous parental and educationalleave provisions that create job openings for new workers. Phased retirement options gradually reduce the work hours of older workers, who can pass on their skills and expertise to younger workers taking their place. One creative experiment gave parents the option of taking the summer months off to be with their children, with guaranteed reentry to the work force in September, thus providing much needed summer jobs for university students and cost savings to employers.

Reducing and redistributing work hours can also improve the quality of life by creating more free time. Timeuse surveys show that the Danes average 11 hours more free time per week than Canadians. But free time has no value in our market statistics.

The more hours we work for pay, the more the economy grows. Canadian women have doubled their participation in the work force in the last 35 years, fuelling economic growth. But they still do twothirds of the housework, and their newfound labourmarket freedom has produced an absolute loss of free time.

SHIFTING THE VIEW

None of this means that there should be no growth of any kind. Some types of economic growth clearly enhance wellbeing, increase equity, and protect the environment. There is vital work to be done in our society—raising children, caring for those in need, restoring our forests, providing adequate food and shelter for all, enhancing our knowledge and understanding and strengthening our communities.

Ironically, while we are so busy counting everything on which we spend money, we assign no value to vital activities that really do contribute to our wellbeing. Voluntary community service, essential household work, and parental childrearing are not counted or valued in our measures of progress, because they are not paid. If they were, we would know they add $325 billion a year of valuable services to the Canadian economy

We will never shift our attention to the work that is needed if we fail to value our natural resources, our voluntary work, our free time, our community strength, and the quality of our lives and environment. And we will never escape from the materialist illusion that has trapped us for so long, or even know whether we are really better off if we continue to count costs like crime and pollution as benefits.

Thirty years ago, Robert Kennedy remarked that the GDP "measures everything ... except that which makes life worthwhile" and noted we have for too long "surrendered community excellence and community values in the mere accumulation of material things."

What is urgently needed are measures of wellbeing that explicitly value our nonmaterial assets. The means to do so exist.

Recently 400 leading economists, including Nobel laureates, jointly stated:

"Since the GDP measures only the quantity of market activity without accounting for the social and ecological costs involved, it is both inadequate and misleading as a measure of true prosperity Policymakers, economists, the media, and international agencies should cease using the GDP as a measure of progress and publicly acknowledge its shortcomings. New indicators of progress are urgently needed to guide our society ... The GPI is an important step in this direction."

A GENUINE PROGRESS INDEX

Here in Nova Scotia, we are making a modest contribution to this effort with the construction of a Genuine Progress Index (GPI) that integrates 20 social economic and environmental indicators into a measure of sustainable development that can send more accurate signals to policy makers and public alike.

Statistics Canada has designated the project as a pilot for the country, and we hope to have it ready for use before the end of the year 2000.

The Nova Scotia GPI assigns explicit value to our natural resources, including our soils, forests, fisheries, and nonrenewable energy sources. It measures and values our unpaid voluntary and household work, and it counts crime, pollution, and road accidents as economic costs, not gains. The index goes up if our society is becoming more equal, if we have more free time and if our health and quality of life are improving.

Unlike the GDP, the GPI goes down if our crime rates increase and our environment is more polluted. It is commonsense economics that corresponds with the realities of our daily lives.

The costs of holding on to the illusion that "more" is "better" are frightening. Scientists recognize the only biological organism that has unlimited growth as its dogma is the cancer cell, the apparent model for our conventional economic theory. By contrast, the natural world thrives on balance and equilibrium, and recognizes inherent limits to growth.

The time has never been better to contemplate the legacy we are leaving our children and the society we want to inhabit in the new millennium. The cusp of the millennium is a rare moment in history when a longterm practical vision can actually overpower our habitual shortterm preoccupations.

See: Part one: Measure of Success

Dr. Ronald Colman was professor of political science at Saint Mary's University from 1993 to 1997. He is director of GPI Atlantic, a nonprofit research group that is constructing ~ index of sustainable development for Nova Scotia.

Copyright © 1999, Ronald Colman

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