Healthy Money Healthy Planet - library.uniteddiversity.coop

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rather than adding them to the whole.
The graph below, sent by Redefining Progress, was created in 2004 using
figures collected by Jason Ventoulis and Cliff Cobb. To calculate the GPI, first a
nation’s personal consumption is taken, then categories of spending are added
or subtracted depending on whether they enhance or detract from the nation’s
wellbeing. The services of highways and streets are added in, along with the
services of consumer durables and the time spent on household work,
parenting and volunteer work. Item that are subtracted include loss of farmland
and wetlands, the cost of commuting, loss of leisure, cost of crime and cost of
water.
Comparing GPI with GDP, Redefining Progress calculated in 2004 that the
economic health of the US had in fact been overestimated by some US$7 trillion.
Emphasising the drawbacks of GDP in a media release, the organisation stated
that: ‘The wrongdoings of Enron alone will contribute up to $1 billion to the US
economy, in the form of legal fees, jail time, media frenzy and associated
payouts.’ 17
The graph shows that the GDP in the US has risen steadily. The GPI,
meanwhile, started below the GDP in 1950, rose until the 1970s, and since then
has gradually declined. The gap between the GDP and GPI is now very wide.
In fact, the rate of decline of GPI accelerated during the 1990s, 18 which is
why we don’t feel any better off even though GDP has increased. As Clive
Hamilton, Director of the Australia Institute, says,
‘In the presence of sustained economic growth throughout the 1970s, 1980s and
1990s, Australians have been strangely restive. They are disgruntled, fractious
and suspicious of the claims by politicians that the economy is doing well.’ 19