Like nurses anxiously watching the pulse rate and temperature of patients in an emergency ward, for a long time we were schooled to observe movements in Gross Domestic Product as the indication of whether a country is healthy or ailing. All of us were brainwashed into acclaiming an increase in GDP as the chief criterion of success and deploring reduction in GDP as denoting national failure. I don’t know who did the brainwashing but I suspect professional economists around the world, that most powerful of undercover trade unions, were behind it. They certainly did a very thorough job. We were mesmerized into keeping our eyes glued on GDP. This was always nonsense and should be seen to be nonsense.
In purely statistical terms GDP is a grossly unsatisfactory measurement. Published GDP figures include neither the products of self-help and self-reliance nor women’s indefatigable, daily work in the home nor the activity in parallel economies. These are glaring omissions if one wishes to measure what is really going on in any country.
What does GDP signify if you have not counted the private production and underground transactions of people anywhere but particularly people in poor countries who in great part have to fend for themselves? In India, for instance, some estimates put such unrecorded activity at anywhere up to 50% of the total economy. In Burma they are used to call such activity the 23rd Corporation because it is bigger and more efficient than the 22 state corporations put together in that country. In the absence of recording self-help efforts, women’s work and underground activity you can be sure that published GDP figures are stripped of reality.
But that is not the main reason why GDP is an inadequate yardstick by which to judge the success of a nation. To put it shortly, such measurement assumes that man lives by bread alone, that material wealth is all that counts. But compare the following: on the one hand twenty millionaires in twenty luxury apartments each dining alone or with a bejewelled mistress on tender fillet steak and vintage wine served by immaculately
dressed butlers; on the other hand a poor but cheerful family, aged grandparents to infant children gathered together, enjoying a giant meal together of spaghetti and mince, it may be, or a good curry and rice washed down by tumblers of home-made drink. The one represent hundreds of millions of GDP, the other a few hundreds. But which stands higher in the scale of real human values?
GDP cannot measure many of the things that are really valuable. How do you count the GDP, in these days of pollution, the blessing of fresh air and bright skies? The warmth and hospitality of a people adds to GDP not one iota more than a cold self-centredness and brutal selfishness. How many poems and songs and paintings does it take to add a tenth of a percentage point to GDP? Safe streets and safe homes do not figure as a plus in GDP. GDP can never reflect how independent, how free, how secure, how cultured, how humane, how, in the best sense, advanced a society really is. The fact is that GDP is grossly misleading as an indicator of what we should call TNW – True National Wealth. And TNW would have to be calculated on a very different basis. That proportion of national resources and effort expended on arms, for instance, should be deducted, not added, to the sum. The quicker the whole world measures by a TNW, not a GDP yardstick, the quicker we will be able to judge real success.
Guyana’s 2014 budget is being prepared. Yet again there will be a great deal of emphasis placed on Gross Domestic Product. It will be proclaimed that Guyana has achieved a year of excellent GDP growth and that we can look forward to equally good growth in 2014. Our success as a nation will continue to be measured in GDP terms.
But GDP is an outdated measurement of how well or badly a country is doing. The UNDP a long time ago introduced the concept of the Human Development Index as a measure of progress superior to the GDP index. The big improvement is that this Index seeks to measure not wealth itself but the way wealth is used. That makes greater sense. Humanity regresses when wealth is used for evil purposes so that simple measurement of wealth itself makes no human sense.
In the new index, for instance, longevity, measured by life expectancy at birth, and knowledge, measured by a combination of adult literacy and years of schooling in the population, are both included in calculating a nation’s success.
Guyana’s Human Development Index is higher than many countries which have higher GDP rankings. It is true that our HDI ranking is still desperately bad – 118 out of 187 countries, compared, for example, with Barbados’s astonishing ranking of 38. Still it shows that we are using what wealth we have more sensibly than many others.
So why don’t we recognize once and for all how true wealth in a nation is to be measured? In his budget for 2014 let Minister Ashni Singh count not only our progress in GDP terms but let us know what progress we are making in less statistical and more human terms.
