We’ve all heard the spiel about the GDP (I got it in high school first and the media later) and how it’s the measure of a country’s economic blahblahblah, and how it’s the primary scorecard that policymakers, economists, international agencies and the media use to show how well we’re doing… but personally, I never did trust suits, so I decided to look a little further.¬† 
“The gross domestic product (GDP) or gross domestic income (GDI) is a basic measure of a country’s economic performance. It is the market value of all final goods and services made within the borders of a country in a year.”
For you math geeks:
GDP (Y) is a sum of Consumption (C), Investment (I), Government Spending (G) and Net Exports (X – M).
- Y = C + I + G + (X ‚àí M)
Perfect!  That should just about wrap it up!
Wait… What about unchecked air and water pollution?¬† Desertification from over-farming?¬† Global warming? ¬†¬† Oh we don’t count those.¬† Those are what we call Externalities!¬† That means they’re taken care of by the SEP field.
Time for more Wikipedia!
“In economics, an externality or spillover of an economic transaction is an impact on a party that is not directly involved in the transaction.”
You know… like the people who have to drink the water and till the land.¬† They can take care of it.¬† And if they can’t, well there’s always future generations right!¬† Right.
That’s OK though, because economists have figured out a way to pick up the slack with GDP growth.¬† Crime, divorce, natural disasters, putting granny in an old folks’ home… those are all transactions we can quantify, and since every monetary transaction is positive they all increase the GDP!
So I suggest you do the right thing for your country!¬† Divorce your spouse, put granny in a home, grab an axe and get clear-cuttin’!
Cheers, and look forward to seeing you at Buy Nothing Day(s)!
In my mind, this is a lot like using share price to value a company. Any investor knows that there is more to a company’s worth than the dollar figure their shares are going for. There’s the potential for growth and the potential for loss all tie up in billions on factors. And business types know it too, hiring the Arthur Andersens and the Fleishman-Hillards and their ilk to sway people’s opinions of those facts.
I guess the only true reflection of a country can be seen by what is, and that’s what GDP does, but it doesn’t paint a complete picture at all. Interesting article, Tiger!
I like calling you Tiger. I feel like Mary Jane Watson.
I really prefer you wouldn’t feel like Mary Jane Watson… you’re too big, much to ugly and far too Jim…
As for the GDP, I’m hopeful that it’s on its way out. The GPI, for example.
Maybe it’ll set the stage for a new way of doing business. Then I might feel like I’d won the jackpot.