Obsession with GDP is fuelling inequality, injustice and climate breakdown – Joyce McMillan

In GDP terms, the Raac concrete crisis – or rather the large amount of repair work it has created – is a good thing

September, and a new political year rolls in, bringing with it Scotland’s latest programme for government, announced by Humza Yousaf at Holyrood on Tuesday. As many have observed, the programme showed very little variation from the policy priorities set out by Nicola Sturgeon in recent years, and enshrined in the SNP’s 2021 election manifesto.

The First Minister also made it clear that he is sticking to the ideological position, on the relationship between social spending and economic success, that helped win him his narrow victory over Kate Forbes in the recent SNP leadership election. Indeed the First Minister draws on his own grandfather’s migrant story in insisting – probably rightly – that economic success is not a precondition for social spending, as business lobbyists often suggest, but that in modern developed economies the two act in partnership, with robust social provision forming the essential basis for a strong economy.

Where these strands of political opinion come together, though, is in agreeing that one essential aim of policy is to achieve higher levels of economic growth. Humza Yousaf described his first programme for government as “unashamedly anti-poverty and pro-growth”; and the assumption that more growth is a good thing still goes almost unchallenged, across mainstream western politics.

This week, for example, a pro-free-enterprise Brussels-based think tank released a comparative ranking of EU countries and US states by headline gross domestic product (GDP), rating almost all EU economies, including those of France and Spain, as less successful than the vast majority of US states, including notorious poverty hot-spots such as Arkansas and West Virginia. The list, of course, mainly generated an unlovely session of “my GDP is bigger than yours” boasting on social media.

Yet in truth, what it revealed is the increasing absurdity of GDP as a measure of human achievement that has nothing to say about the distribution of wealth and well-being, and simply prefers any economic activity measurable by cash to peace, quiet and inactivity, regardless of the context. It makes a positive number, for example, even out of events like this week’s headline Raac concrete crisis, which will precipitate a large amount of repair work, and is therefore better for GDP than building schools that might last.

By the same token, it prefers sickness to health, and destructive paid employment to constructive volunteering. And of course it places no value at all on happiness or well-being, both of which tend to diminish the human need for excessive material consumption. An Oxfam report once characterised the ideal citizen for GDP growth purposes as a dying man receiving heroic medical treatment, who smokes and drinks heavily, and crashes his car three times a week.

And now, of course, we also know that our obsession with GDP growth is killing our planet as a habitable human environment. Governments like the Scottish one, which embrace ambitious climate targets, like to believe that there is something called “green growth”, which will enable economic activity to continue on its ever-upward path by developing “green” technologies and industries.

Yet a worrying report published this week by researchers at the universities of Leeds and Barcelona suggests that in the world’s developed economies, “green growth” is simply not happening. Even in those countries which have achieved some decoupling of growth from increased carbon emissions, the average rate of decline in emissions was only two per cent; and the researchers calculate that at that rate, it would take them 200 years to reach zero emissions status. “There is nothing green about this,” said lead author Jefim Vogel, of Leeds University. “Continued economic growth in high-income countries is at odds with the goal of averting catastrophic climate breakdown, and with the fairness principles that protect development prospects in lower-income countries.”

Now of course, other voices will dispute this view. Yet as the UK swelters in unprecedented September heat, it seems to me that we have to find the courage to face what science tells us is the truth; that unless we find ways to live more simply and sustainability, with less frantic economic activity, fewer miles travelled, fewer buildings demolished and rebuilt, less food transported over long distances, and much less waste in general, then much of our beloved world will be gone, before children born this year even reach middle age.

We could, of course, if we choose to make the right changes, end up with more rather than less of the things that truly make life worth living; not a lesser world but a better one, in which we learn to live in balance with the natural environment on which we depend, and create systems which reflect all aspects of human nature, and not just our capacity for boundless material greed.

What is clear, though, is that we cannot get there if we continue to measure our success by gross domestic product alone. So far, international attempts to construct alternative measures of achievement based on well-being and human development have failed to gain the levels of credibility and clout that GDP still enjoys; and those like the Scottish Greens who raise the question of whether unlimited economic growth is a good thing are dismissed as eccentrics.

Yet according to Oxfam, the dominance of GDP is now steering policymakers towards priorities that are fuelling lethal levels of inequality, injustice and climate breakdown. And although the usefulness of endless growth to politicians is obvious – in that it enables them to spend without having to tackle the politics of redistribution – the moment must come, and soon, when some brave mainstream politician finally admits that our traditional method of measuring economic progress is no longer fit for purpose, and that his or her government will not only be exploring alternatives, but will no longer be using conventional GDP growth as a yardstick, either in developing economic policy, or in measuring its success.