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 Alternative
Economic Measures
Related
section>> Follow the Money
& Economic Measures
Our society places tremendous importance on a healthy, growing
economy. Somehow the assumption is made that a healthy economy
equals a healthy community, that a country's economic growth
means increased happiness and wealth for its citizens. But
many of us know that the amount of money moving through our
country's economic systems says very little about the health
and wealth of citizens. We need alternative economic measures
that reward positive growth while taxing growth that is harmful.
The usual Economic Measures
have no way of measuring how money is distributed within a
country nor how economic activity contributes to production
and services that are healthy for society and the environment.
If we look at economic growth without looking at the costs
of this growth, we leave many people out of our economy and
we create havoc for the earth. Reducing the economy to a simple
money equation means missing out on many opportunities to
care for ourselves, each other, and the earth.
 We
all make many decisions a day, some more important and having
greater implications than others. We choose how to respond
to our arguing children, which jobs to apply for, what foods
to buy, whom to love, whether or not to make large purchases
like a washing machine, and where to live. We also choose
whether to walk or take the bus, whether to buy that sweater
or not, to eat at a restaurant or at home. Our lives are full
of decisions. But how do we make decisions? For most of us,
the biggest decisions of our life, like choosing relationships,
are not made according to money. If we were asked to name
the most important aspects of our lives, those at the top
of the list are more likely to be relationships, experiences,
and opportunities, rather than our savings accounts and RRSPs.
Rather than a simple mathematical equation of GDP,
our economy needs a set of measures that includes financial
cost as well as other kinds of costs, such as costs to the
environment, costs to ourselves, costs to society. And we
need a system that allows us to measure the things that are
truly valuable in life: happiness, health, community, and
life. (See Rae's story.)
Feminist economist Marilyn Waring suggests that instead of
charting the flow of money, time-use
surveys should be the starting-point for analyzing our
society. For example, Waring points out that research done
by Status of Women Canada shows that 2/3 of primary health
care in Canada takes place in the home. This leads her to
ask why 2/3 of the primary health care budget is not directed
to the home.
Since 1996 time-use surveys have been a part of the Canadian
census. A percentage of respondents are asked to fill out
detailed forms noting all their activity in a given week.
This means that governmental officials, statisticians, and
policy-makers know how much time is spent on unpaid work in
Canada. Using different methods, they can also calculate the
monetary value of that unpaid work which turns out to be between
30.6% and 41.4% of the GDP - no small amount. The spread of
almost 12% between the two numbers is a result of the two
different valuation methods used. Replacement
value is calculated on the basis of how much it would
cost to replace unpaid workers with paid workers based on
current hourly wages for comparable work. In Canada in 1992
this was $284.9 billion. Opportunity
value, on the other hand, is calculated on the amount
women would be earning if they were in the paid labour market
instead of doing unpaid work. In Canada in 1992, the opportunity
value of unpaid work was $318.8 billion. To read more about
these measures visit Valuing
Unpaid Work (notes on a talk by Evelyn Drescher.)
 Unfortunately
both replacement value and opportunity value perpetuate the
fact that women's work, even in the paid work force, is undervalued
and paid less than men's. However, numbers as staggeringly
high as $300 billion do highlight the absolute dependency
of paid work activities on women's unpaid work of reproduction
and care of life. The calculations rely on time-use surveys
to gather statistics on unpaid work. The wealth of information
a time-use survey generates is a crucial tool to be used in
the policy creation work of the federal and provincial governments
of Canada.
The founders of Nova Scotia's Genuine
Progress Index (GPI) took Waring's suggestion to measure
time and they went even further. They wanted an economic measure
that would allow for values beyond market values. As they
say, "What we measure is literally a sign of what we
value as a society. If critical social and ecological assets
are not counted and valued in our measures of progress, they
receive insufficient attention in the policy arena."
And so they came up with a system that consists of 22 social,
economic and environmental components used to measure genuine
progress within the province. The components include:
| 1.
Time Use |
Economic Value of Civic and Voluntary Work
Economic Value of Unpaid Housework and Child Care
Costs of Underemployment
Value of Leisure Time
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| 2.
Natural Capital |
Soils and Agriculture
Forests
Marine Environment/Fisheries
Non-renewable Subsoil Assets
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| 3.
Environment Quality |
Greenhouse Gas Emissions
Sustainable Transportation
Ecological Footprint Analysis
Air Quality
Water Quality
Solid Waste
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| 4.
Socio-economic |
Income Distribution
Debt, External Borrowing, and Capital Movements
Valuations of Durability
Composite Livelihood Security Index
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| 5.
Social Capital |
Health Care
Educational Attainment
Costs of Crime
Human Freedom Index
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If the GPI were used as a measure of economic growth, governments
would not likely support the expansion of the arms industry
or the development of casinos as these are shown to have destroyed
the health of communities. In contrast, governments would
be more likely to support social services that provide for
the most vulnerable members of society.
In our own lives there are many things that we can do to broaden
the way our society measures economic growth. What can you
do?
- We all need to start talking about economics, recognizing
that it is our right to say how we want the economy to be
structured.
- All citizens of Canada have the right - and responsibility
- to talk to their elected government officials and question
on what basis they make decisions. We can ask them how they
are using time-use data collected by Statistics Canada.
We can also ask them what they know about alternative accounting
and encourage them to use measures like the GPI Atlantic
as tools for measuring healthy societies.
- We can join organizations like the Canadian
Centre for Policy Alternatives (CCPA) and GPI
Atlantic joining our voice with others to demand that
economic growth not be the only measuring stick used to
make decisions in our society. Some organizations, like
the CCPA, produce Alternative
Budgets and look for citizen input in this process.
- We can work with our governments and civil society to
ensure the maintenance of systems that protect the most
vulnerable (health care, education, social assistance).
These are not charity but rather essential parts of a healthy
economy.
- We can join trading and bartering networks or start our
own informal systems that create societies of equality and
caring. We can refuse to participate in economic activities
that are harmful to people and the earth by not buying violent
games, reducing the amount of imported foods and other goods
we consume, and choosing to support small businesses instead
of large corporations.
- We can adapt our language so that we don't say things
like, "My mother doesn't work." We can start to
see that all people of all ages and all abilities are contributing
to the society we live in regardless of whether or not they
are recognized by the monetary economy.
- We can learn to judge the richness of our society and
ourselves on things other than money. Many people who have
money are very poor in time because they are so busy working
to accumulate that wealth. Those of us who have little money
may be rich in ideas, time, sensitivity, and have other
gifts that are much needed in our society.
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