Measuring genuine progress


daphne wyshamKitayun Rustom (CERE) writes from Mumbai: “Have you heard of Genuine Progress Report? My friend Daphne Wysham is working on this. Better indicator than GDP.

A search revealed an article by Daphne Wysham (right) and the main points are summarised below:

At the height of the Great Depression, Congress, lacking the tools to measure accurately how the economy was faring, turned to a young Russian-American economist, Professor Simon Kuznets of the National Bureau of Economic Research, to develop a data set to assess the state of the national economy..

simon kuznetsIn 1937, Kuznets presented a vast volume of data on income to Congress. The data set became known as the Gross National Product (GNP), later renamed the Gross Domestic Product (GDP). But Kuznets warned that the GNP could never adequately measure the things we value, such as housework or caring for elderly parents. Nor could the GNP distinguish between the growth of good and bad jobs. The data would be the same if workers earned their pay from employers who endangered their lives or guarded their health and safety.  He said: “Goals for more growth should be more growth of what and for what”.

Under governor Martin O’Malley, Maryland has retained its AAA bond rating demonstrating sound financial management and, as early as 2007, established the living wage for employees working under certain state services contracts.

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Maryland is now monitoring the state’s well-being using the Genuine Progress Indicator, gathering and annually updating economic, social, and environmental data that help to measure the overall wellbeing of Maryland’s citizens.

The 26 underlying indicators, which collectively comprise the “Genuine Progress Indicator,” are a more meaningful gauge of the overall economic health and wellbeing of Maryland residents than standard economic measurements. For example the state tracks factors which help to make a society more healthy and vibrant, like volunteerism, time spent with family and loved ones and air quality. They answer many questions, including:

  • Is the landscape more or less toxic than before?
  • Is the air and water cleaner or dirtier?
  • How well-educated is the populace?
  • Is public transportation decent?
  • Is crime more common?
  • Are too many people spending more time commuting to jobs than at home with their kids?

Daphne Wysham ends: “It’s time to recall Kuznets’ warnings about the limitations of the GDP and to pick up where he left off by embracing a new set of tools that will help shape good social, environmental, and economic policy — not just for Maryland, but for our entire country and the world”.

Daphne Wysham is a fellow at the Institute for Policy Studies (IPS) and is the founder and co-director of the Sustainable Energy and Economy Network (SEEN). SEEN’s pathbreaking research has resulted in shifts in public policy and investment at the national and international level. She is a frequent guest speaker on the concerns around carbon markets — and carbon offsets in particular — in generating meaningful greenhouse gas emissions reductions. Wysham has played a leadership role on Capitol Hill, advising the Congressional Progressive Caucus on a progressive agenda for climate change.

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