On June 25, the U.S. Bureau of Economic Analysis released its highly anticipated gross domestic product numbers and revised the negative first quarter estimates downward. Increasingly, the fate of presidents and governors as well as macroeconomic policy is tied to these numbers. But as we consider the economic challenges of the 21st century, it is increasingly clear that conventional metrics of growth are inadequate.
GDP measures the economic output of a coal plant, but it doesn’t tell us how many children get asthma or tally deaths from coal-related air pollution. As Robert F. Kennedy said in 1968, “We seemed to have surrendered personal excellence and community values in the mere accumulation of material things. Our gross national product now is over $800 billion dollars a year, but … that gross national product counts air pollution and cigarette advertising and ambulances to clear our highways of carnage.”
Economists have long known the difficulties in using production as a proxy for progress, but that arcane debate has rarely leaked into the broader public discussion. More than four decades later, the threat of climate changes forces us to confront the question of what we are sacrificing for growth.