Media Clipping — November 2, 2004, The Hansard Record

House of Commons Discussion on a better measuring standard for our progress than the gross domestic product

By Ronald Colman

Senator Austin: The challenge for Canada is to find the way, through new technologies and better practices, to make our contribution to an environmentally safer world for not only the next generation of Canadians but for all who inhabit this planet. As Prime Minister Paul Martin stated in his address to the House of Commons on October 6 last:

...we understand that our success and our quality of life are increasingly tied to our relationship with our environment. The decisions we make now have profound implications for the future.

I want to touch briefly on a few indicators in Canada's economic performance. In terms of the prosperity of Canadians, we have navigated through difficult times in the 1980s and 1990s into a period of relative economic stability and growth. Statistics Canada advised last week that growth in the 2004 GDP would probably come in at about 3.75 per cent rather than the Bank of Montreal's prediction of 3.25 per cent or the Bank of Canada's prediction of 3 per cent. Canada has seen six straight monthly advances, including 0.5 per cent in August and 0.2 per cent in July. The August 2004 gain can be compared also, showing it is an advance of 4.6 per cent over August 2003. Statistics Canada says that both the goods and services sectors contributed, with utilities, retail trade, entertainment, manufacturing, information and communications sectors showing the way.

The Export Development Corporation recently advised that Canada would continue to show moderate growth through 2005. The United States economy, to which Canada is closely tied, is reported to have grown at 3.7 per cent during the third quarter, that is, July, August, September. Consumer spending was the leader in keeping the U.S. economy advancing.

Projections are for a sustained economic performance in both Canada and the United States through 2005. Private economists in Canada advise that the Canadian economy is performing close to its capacity, which should show working Canadians some growth in real income as well as delivering encouraging employment numbers.

From time to time, we see articles in newspapers and magazines questioning why we cannot develop a better measuring standard for our progress than the gross domestic product. The GDP is an economist's way of measuring the performance of a variety of economic actions to draw a conclusion about overall economic activity in our society. A recent article in Saturday Night magazine by Sean Butler described the shortcomings of the GDP performance index. The key concern is that no account is taken by the GDP formula of whether growth is a positive advance for society or whether it is the result of the destruction of existing capital or resources where re-investment is required. As Sean Butler notes, destruction of the environment is often a positive development in the GDP index. He describes how spending that creates disease, kills people, destroys community viability, or leads to gambling, is statistically described as positive in economic terms. If there were 10 things we could hope to see in 2005, for me one would be an alternative universal index that measured economic growth in qualitative terms.

Copyright © 2004, The Hansard Record

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