GDP – This Magazine https://this.org Progressive politics, ideas & culture Tue, 08 Aug 2017 14:36:48 +0000 en-US hourly 1 https://wordpress.org/?v=6.6.4 https://this.org/wp-content/uploads/2017/09/cropped-Screen-Shot-2017-08-31-at-12.28.11-PM-32x32.png GDP – This Magazine https://this.org 32 32 Inside Newfoundland and Labrador’s uphill battle to economic prosperity https://this.org/2017/08/08/inside-newfoundland-and-labradors-uphill-battle-to-economic-prosperity/ Tue, 08 Aug 2017 14:36:48 +0000 https://this.org/?p=17088 This year, Canada celebrates its 150th birthday. Ours is a country of rich history—but not all Canadian stories are told equally. In this special report, This tackles 13 issues—one per province and territory—that have yet to be addressed and resolved by our country in a century and a half


Newfoundland and Labrador Premier Dwight Ball.

Newfoundland and Labrador Premier Dwight Ball.

At a St. John’s rally on April 6, the day the provincial government released its 2017 budget, Michelle Keep addressed a crowd of about 40 protesters. “We need ideas outside the box,” she told them. “We need them now, we need them fast.”

Keep, a best-selling romance novelist based in St. John’s, has built her living on creativity and risk—and her experiences could hold one of the keys to the future of work for Newfoundlanders and Labradorians.

In 2016, the government of Dwight Ball made many cuts, including to education spending, libraries, and the civil service, and introduced a tax on books. The economy had been deeply reliant on royalties from offshore drilling, making $2.8 billion in 2011-12. In 2015-16, royalty revenues only reached $551 million.

As the government struggled to deal with a drop in resource extraction revenues and rising unemployment, it turned to austerity. Though revenues in 2017 had been higher than forecasted, activists rallying in St. John’s had expected the year’s budget to impose more cuts. The budget didn’t offer much relief for people struggling, with higher education hit the hardest.

Now, the province is banking on industry for its financial salvation: oil, gas, seafood, hydro, mining, lumber and agri-food. “In order to return to fiscal balance we must think and act in a way that is long term,” Minister of Finance Cathy Bennett said in her budget speech. “We can no longer afford to be bound by short-term reactionary thinking.”

But it’s hard to not see short-term reactionary thinking in Bennett’s budget. They’re short-term fixes in various resource industries designed to tide the province over until commodity prices pick back up. Bennett claims that with infrastructure spending, some jobs will be created. But it’s not nearly enough.

Unifor Atlantic regional director Lana Payne and economist Jim Stanford call the province’s economy a “helicopter economy,” in which natural resource companies generate a lot of profit, but not enough of it makes it to average people. As a resource-dependent province, Newfoundland and Labrador should be able to buoy public finances with revenues from extraction. But Payne says that the proportion of the province’s GDP that went to corporate profits when revenues were at a high of 37 percent. Nationally, the percentage is 15.

The solution to improve the province’s economy isn’t hard to see, but it requires political will and more control over industry by average people. “[The] emerging struggle is the same struggle we have always had here: keeping more of our wealth, using that wealth to diversify and share prosperity, and invest more in our creative industries, green jobs, etc.,” Payne writes in an email. The province, she adds, needs to entice more youth and more immigrants to live there. Choosing to make cuts in higher education suggests that the government is forging a different path.

If the government isn’t interested in creating or protecting new, good jobs in Newfoundland and Labrador, Keep’s vision for her province should inspire people to do the work themselves. “[O]nce you no longer have to guarantee a profit for the owners or investors, a business of any sort can often securely operate for the good of the workers, for the good of the customers, for the good of the whole community without worry,” she told the budget-day protesters. “All it requires… is a change in how we as a society, and the government, view things.”

Perhaps that’s the key: Start with society, and maybe government will follow.

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Friday FTW: The crazy concept of happiness and progress https://this.org/2013/03/22/friday-ftw-the-crazy-concept-of-happiness-and-progress/ Fri, 22 Mar 2013 17:49:03 +0000 http://this.org/?p=11807 On Wednesday the UN asked us all to forget our misery; forget our stressful, routine, depressing lives and just cheer up. People all over the world listened and marked the first International Day of Happiness with events such as “laughter yoga” in Hong Kong, positive message posters at the London Liverpool train station, and free hug flash mobs in Washington (to victims of these mobs, my deepest condolences).

But happiness day wasn’t just about getting your grin on. The idea is to recognize happiness and well-being as valuable measures of growth.

Most of the world measures growth and development through gross domestic product, where increase in GDP means progress. The problem is a lot of terrible things inflate GDP. Like oil spills and wars.

As the prime minister of Bhutan, Jigme Thinley, said:

Economic growth is mistakenly seen as synonymous with well-being. The faster we cut down forests and haul in fish stocks to extinction, the more GDP grows. Even crime, war, sickness and natural disasters make GDP grow, simply because these ills cause money to be spent … We need to rethink our entire growth-based economy so that we can thrive more effectively on our own resources in harmony with nature. We do not need to accept as inevitable a world of impending climate chaos and financial collapse.

In Bhutan, a small country on the southern slopes of the Himalayas, happiness defines progress. It’s the only country where gross national happiness (GNH) replaces GDP. Bhutan’s happiness index measures factors such as cultural preservation, environmental quality, physical and psychological health, and good governance. These values are entrenched in the country’s policies with mandates that require the country to be carbon neutral and leave 60 percent of the land covered in forest. School enrollment for Bhutanese children is 100 percent, and export logging is banned.

The idea is to reduce needs to match the available resources; to strive for happiness rather than material gains. But when you’re constantly trying to maximize your resources—a la Western capitalism—your needs (or wants) increase in parallel. To fulfill our insatiable neediness, we increase our goods and services. This is what we call “growing the economy”.

For years, renegade economists have challenged this type of progress. Jeff Rubin, among others, predicted an “end of growth” economy and called for a “holistic” economic approach that factors in well-being. These economists were mostly ignored until the stock markets crashed and natural disasters became a first world problem. Clearly we’re doing something wrong.

So last April, the UN discussed “new economic paradigm” inspired by Bhutan’s gross national happiness initiative. Three months later, the UN declared March 20 International Day of Happiness, recognizing the importance of well-being in public policy.

The trouble is: how do we measure happiness? Subjective happiness is easy. Just measure someone’s general life satisfaction through surveys and questionnaires. The trickier measure, objective happiness, looks at more universal ideals presumably linked to well-being, like health levels, crime rates, literacy and life expectancy.

There’s no consensus on how policy-makers can apply well-being scores to economics or even how being happier can help the economy. The good news is people are talking about it—reminding each other that happiness is really the only important thing in life. And not just happiness for ourselves but for other people and future generations.

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