Media Clipping — Sunday, July 30, 2000, The Daily News, Halifax

GPI Atlantic Offers Overdue Measures

Halifax Research Group Introduces Better Way to Assess Resources, Well-Being

Counting the things that really count

By Parker Barss Donham

A Halifax research group reported last week that the quality of Nova Scotia's drinking water is improving even as our rivers, lakes, and wetlands are degrading.

Yawn. A mundane, unsurprising conclusion about a resource so commonplace we all take it for granted.

Except that the 230-page study by GPI Atlantic, first in a series of natural resource accounts the nonprofit group plans to release this year, poses a fundamental challenge to the way our society makes decisions.

GPI stands for Genuine Progress Index, a name intended to contrast with Gross Domestic Product or GDP, the index by which governments traditionally measure economic progress.

GDP -- the old measure -- represents the total of all goods and services produced in a given country, province, or region. Originally designed to track strategic production in wartime, it remains a familiar tool for gauging economic activity.

Because it is so simple and familiar, the GDP tends to get pressed into service as a broad measure of social progress and well-being, tasks for which it is not just ill-suited but misleading.

The GDP is valueless. It makes no distinction between a dollar spent on a Lennie Gallant CD or a dollar spent repairing a window smashed by vandals. It includes a variety of expenditures defending against, or mopping up after, events that could hardly be considered marks of progress or well-being -- things like crime, pollution, and disease.

Sydney Steel's notorious coke ovens boosted the GDP once while producing the pollution that created the tar ponds, and again when millions were spent in a failed attempt to clean up. If a second cleanup attempt ever gets off the ground, the GDP will register another boost, as it does every time a patient from Whitney Pier enters hospital with pollution-caused cancer.

The GDP places no value on natural resources except while they are being depleted. So it counts any activity that consumes natural resources as a plus, with no accounting for the depleted inventory of that resource.

The GDP has other failings. It counts money spent fighting off disease but places no value on good health. It takes no account of income disparities.

The Genuine Progress Index attempts to create a broader, more accurate measure of social progress and well-being. Nova Scotia is fortunate to have, in GPI Atlantic, the first attempt to create such an index in Canada. In fact, it's the first time discussion of such an index has moved from the realm of academic theory to real-world application.

That turns out to be an immensely complex task. Where the GDP tracks objective data on the production of goods and services, the GPI seeks to account for a series of value-laden concepts like health, environment, and personal security.

"Progress" and "well-being" are subjective terms encompassing many activities and resources that are hard to translate into dollar values. But if you only count things that are easy to count, many important things get left out.

Most of us know this intuitively. Struggling to explain why we choose to live in Nova Scotia, when we might make more money elsewhere, we lapse into fuzzy sounding terms like "quality of life."

The current GPI Atlantic report focuses on water, a perfect example of a resource that only registers on the GDP when it is depleted or degraded.

When the former Liberal government allowed a friend of Environment Minister Michel Samson to mine sand off an Isle Madame beach, the GDP ratcheted upwards. But the eventual loss of the valuable beach in question will not cause a flicker in the GDP.

From a variety of sources, the report inventoried the current state of drinking water supplies, rivers, lakes, and wetlands.

"Wetlands are among the most productive ecosystems in the world," said author Sara Wilson. "They perform a host of incredibly valuable functions, including waste and nutrient cycling; protection against erosion, floods and storms; water purification; food production; and are one of the richest known wildlife habitats and an essential link in the food chain."

The report notes that Nova Scotia has lost 62 percent of its saltwater wetlands, and 17 percent of its freshwater wetlands. Using a conservative estimate of the value of those services, it estimates that these lost wetlands cost Nova Scotia $2.3 billion per year in lost ecological services.

Ironically, legislative changes over the last ten years have reduced the already meager protection afforded wetlands in Nova Scotia, by fobbing responsibility for them onto municipalities. If we had a Genuine Progress Index in place when those laws were passed, we might have made wiser decisions.

Forthcoming GPI Atlantic reports will include natural capital accounts for forests, fisheries, and soils, and agriculture; a greenhouse gas account; an ecological footprint analysis for the province; an air quality account, and a full-cost accounting analysis of different modes of transportation in Nova Scotia.

Copyright © 2000, Parker Barss Donham

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