[IslandCrow]

As has often been stated in these forums our current economic system is one that requires growth. But growth is defined mostly in terms of economic activity (GNP) etc. This measurement of growth, is not interested in whether there is an increase in “wealth” or not. For example both building a house and demolishing it register as economic activities; - one ‘creates’ wealth while the other ‘destroys’ it.

As we are coming to the end of growth in energy (and growth in the traditional economic sense), we need some other economic models. I would propose that such an economic model should give more attention to ‘wealth’ rather than just ‘economic activity’. Such a move might help us towards a mind-set that is more open to a ‘sustainable future’.

I realise that it is a lot easier to measure ‘economic activity’ than it is even to agree on what ‘wealth’ is, let alone measure it. But there are a couple of common indicators for ‘wealth’ that we could use now. In current accounting practices firms have to produce a Balance Sheet as well as an Income and Expenditure statement. The balance sheet shows the wealth and debts of the company. The ‘fixed assets’ part of this balance sheet can be used as an indicator A second indicator could be from the registers of property values for property tax. I realise that both these indicators are far from perfect, but they are readily available (at least to governments).

A greater use of these indicators in economic discussions could help show whether wealth is being created in a local community or whether all that economic activity is just 'burger flipping'.

[MrBill]

There are already many wealth indicators that are widely used. The UN publishes its own human development index based on health, wealth, level of education, crime, etc. But there is a strong correlation between GNP/GDP and health and wealth. Ditto for Transparency Internationals anti-corruption index. They are all related concepts.


I agree that GNP/GDP only measures miss a lot of quality of life factors. But measures of economic activity are no less useful. They allow us to track changes in the real economy overtime including the negative effects of inflation or resource depletion for example. We just should not be slaves to the growth theory.

The Nordic countries tend to score very high on most economic and human development indices, but for example when you look at purchasing power parity data you see that your money would go much further in some of the Club Med countries of Europe. You do not want to be fooled into thinking you're wealthier than you actually are do you? ; - ))

[SILENTTODD]

"I have the greatest of riches: That of not desiring them." - Elenora Druse.

If most of America accepted this we would be at least 25% further along in dealing with the outcome of Peak Oil.

[MrBill]

How about a Human Decency Index that measures a country's repulsion at 'honor killings' amoung other things? How can you ever measure a country's 'wealth' if they do not extend to basic human rights and dignities for women, children and visible minorities? A country may be 'rich and totally backwards' at the same time.

$this->bbcode_second_pass_quote('', 'A') Kurdish woman was brutally raped, stamped on and strangled by members of her family and their friends in an "honor killing" carried out at her London home because she had fallen in love with the wrong man.

[IslandCrow]

$this->bbcode_second_pass_quote('MrBill', 'H')ow about a Human Decency Index....

[ushoys]

$this->bbcode_second_pass_quote('MrBill', 'H')ow about a Human Decency Index

[Tyler_JC]

$this->bbcode_second_pass_quote('ushoys', '')$this->bbcode_second_pass_quote('MrBill', 'H')ow about a Human Decency Index

[Ibon]

We have a little known country in central Asia, Bhutan, that actually replaced GDP statisitics for GNH (Gross National Happiness).

Here is a link and excerpt

http://travelbhutan.tripod.com/druk.html

$this->bbcode_second_pass_quote('', 'W')hile most developed nations fret over their gross national product (GNP), Bhutan is a place, perhaps the only place on earth, where the official government policy is Gross National Happiness (GNH)- where cultural, environmental, spiritual well being and happiness of the people comes ahead of monetary wealth

[MrBill]

I am really worried about The Clash of Civilizations. Incompatible ideologies. I am not not just talking about consumption. Because we have become 'so secular' many of us take for granted the role that Christianity played in making our society what it is today. It was a basic protection against outside invaders in, say, northern Europe that would have otherwise forced us to become, say, Muslim.

Christian values are apart of us, just like other faiths underpin national identities elsewhere. None of those values are absolute, as mentioned above, but there are a lot of core values of the Islamists and the Taliban that I could never accept for me or my family and especially not for my wife or daughters. In short, those ideals are worth fighting for.

We live in an oil soaked age of plenty, and yet some societies are completely backward. They are two steps away from the Stone Age. I do not defend 'western' values such as conspicuous consumption or unsustainable living at a huge cost to the environment and future generations. But I do defend basic human rights and scientific enlightenment.

I am not living this life for the next. I do not believe in caste society. I do not believe in royalty. It may sounds old fashioned or out of style, but I am decended from the roots of the old Protestant Work Ethic. Self-reliance, hard work and learning to read, we all take it for granted now, but even 200 years ago that defined only a tiny sliver of the human population concentrated in northern Europe. It was very democratic. I do not mean all those societies were democratic, but learning became wide spread instead of being limited to the very few.

I have no patience for history revisionism. The countries that come out on top on the UN's human development index deserve to be there. It is not an accident. Despite ancient marvels, societies evolve. A great society that created architectural or cultural wonders 500 or 1000 years ago is nothing today, unless it has evolved to respect basic human rights and has learned from its own mistakes. Indeed learned from the mistakes of others.

Many countries today do not even deserve to be refered to as countries. They should not even be in the UN. Sovereignty means nothing if there are ongoing human rights abuses or ethnic cleansing. International treaties should not protect those that carry out such attrocities. And practices such as honor killings and genital mutalation have no place in a modern, progressive world.

It despairs me that we have not solved so many problems in this age of plenty because I do not see them being solved in an age of resource depletion either. Rather more wars over resources under the guise of ideology or of religion.

It is hard to thrive when others are struggling to survive.

[Tyler_JC]

Mr Bill has my vote for world decency standards committee chairman!

It angers me that a voting bloc of African dictatorships can influence global policy in the United Nations. Why does Zimbabwe get to stay in the UN?

No one has ever given me an adequate explanation for that one.

[oiless]

$this->bbcode_second_pass_quote('MrBill', ' ')

International treaties should not protect those that carry out such attrocities. And practices such as honor killings and genital mutalation have no place in a modern, progressive world.

[Tyler_JC]

$this->bbcode_second_pass_quote('oiless', '')$this->bbcode_second_pass_quote('MrBill', ' ')

International treaties should not protect those that carry out such attrocities. And practices such as honor killings and genital mutalation have no place in a modern, progressive world.

[oiless]

Yah, I've read the study Tyler, note that it is not definitive.

http://www.doctorsopposingcircumcision. ... ement.html

Why is the foreskin rich in white blood cells? Because it's part of your bodies immune system, along with tonsils and adenoids, but that's another story.

Bottom line, it's a cosmetic mutilation of the male genitalia, one that often results in serious complications and occasionally death.

This ignores morality of torturing screaming babies of course.

[Tyler_JC]

$this->bbcode_second_pass_quote('oiless', 'Y')ah, I've read the study Tyler, note that it is not definitive.

http://www.doctorsopposingcircumcision. ... ement.html

Why is the foreskin rich in white blood cells? Because it's part of your bodies immune system, along with tonsils and adenoids, but that's another story.

Bottom line, it's a cosmetic mutilation of the male genitalia, one that often results in serious complications and occasionally death.

This ignores morality of torturing screaming babies of course.

[oiless]

Fine by me.

Global wealth is a concept of, by, and for capitalist bean counters.
It's a concept with no value or merit as far as I can see. We don't need to come up with a new way to measure it, we need a new concept that has nothing to do with "wealth".
(I use "wealth" here in the western sense of monetary and physical things.)

Perhaps a measure of contentment, because contentment is really what it's all about. In our society we are never content. It's always about the next acquisition, the next promotion, etc.. We are inculcated pretty much from birth to not be content.
What does a person need to be content? I would say that the basic ingredients are stable food supply, stable water supply, assured shelter, human companionship with minimal conflict, and something productive to do with ones hands and mind.

I'm afraid I don't know much about the Bhutan GNH concept. It sounds great, but I can't comment due to a lack of knowledge.
It way be a great step forward, or it may be a monarch coming up with an innovative way to keep the peasants subdued in substandard conditions.

[Tyler_JC]

I think we should create some kind of index, similar to the consumer confidence index, for the global happiness measurement.

Take the following factors, at 10% weight each, and move the index up or down based on whether or not improvement has been made on these fronts.

For example, a life expectancy of 80 adds 8 points to your score. If 75% of the population has access to clean water, you get 7.5 points.

1. Life Expectancy.
2. % of population with access to clean water.
3. % of population not living in poverty.
4. % of population with access to basic medical care.
5. % of population with a high school diploma or better.
6. % of population owning their own homes.
7. Literacy Rate
8. % of population approving of their leader/government
9. % of population who believe that the next generation will be better off than they are.
10. % of population not unemployed (or, 100% minus the unemployment rate)

I'm just picking 10 things off the top of my head.

Here's the results for the United States.

1. 7.7 points
2. 10 points
3. 8.7 points
4. 8.5 points (15% have no health insurance)
5. 8.6 points
6. 6.4 points (I'm erasing the past 10 years gains here)
7. 9.5 points (excluding a few functioning illiterates)
8. 3 points (this is where we get screwed)
9. 3.4 points (see above comment)
10. 9.2 points (I'm guessing that real unemployment is closer to 8%)

Out of a possible score of 100 points, America gets 75 points. A solid C.

Feel free to use Tyler's Index of Human Development to measure your own country.

[MrBill]

Not a bad index. I would make some changes.

Firstly, policies to encourage own homeownership are not bad per se, but they tend to have perverse consequences such as favoring home owners over renters, who are also taxpayers, and the misallocation of capital into one asset.

I would do everything possible to facilitate home ownership, but I would stop short of distorting tax policies, by for example, making interest payments on home mortgages tax deductible.

Also, no-money down mortgages are a risk to existing homeowners, so would-be buyers should be encouraged to put down 20% down payments to avoid negative equity situations. I would not 'insure' non-standard mortgages that do not meet minimum requirements such as substantial downpayments.

Afterall your objective is homeownership, not property speculation.

I would also clawback any financial aid to over-sized houses or environmentally unfriendly houses. Not everyone can or should live in a McMansion, or even a detatched home. Home size should be in the context of liveable communities. And apartments are an acceptable alternative in my own opinion. Something Europeans are very comfortable with.

However, you have to remember one thing as well. Higher incomes, health insurance and rising living standards by no means imply that voters or residents will be happy with their governments. I would discount that measurement altogether. The greatest good for the largest number is a noble policy. You cannot please all the malcontents! ; - )

[Niagara]

Nice list Tyler.

I'd like to add what Catherine Austin Fitts coined the "Popsicle Index"

Basically it's the percentage of people in a community who believe that a child can safely go to the store alone, buy a popsicle and return home.

Some neighborhoods have probably dropped from 100% to 0 within a generation or two.

I live in Canada, so I don't really know what the Popsicle Index is for the USA as an average (ours would be higher).

[oiless]

It looks to me like we backed away from happiness and got right back to measuring expansionist economics.

Home ownership is not needed for happiness. If having a home means making onerous payments to money lenders for most of you existence then it's a hindrance to happiness.

Some of the happiest people I've ever met have been dirt poor.
(But have had the five basics needed for contentment.)

Some of the happiest people I've ever met have been illiterate.
(But have had the five basics needed for contentment.)

Knowing your children will do better than you is not needed if you are happy. (The whole each generation improving its lot thing is a cornerstone of expansionist economics IMO.)

Employment is not essential to happiness, having something productive to do with your hands and mind is, most employment does not fit that criteria.

I think we are so wrapped up in our western economic system that we have a hard time even shaking it off enough to see what it is.

[Tyler_JC]

I'm not taking literacy off the list.

I don't care if you can be happy and uneducated.

Societies in which people can read are always better places to live than societies in which people cannot read.

Who could be happy knowing that his/her children will be worse off in the future?

We can increase our quality of life without increasing our strain on the environment.