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Economic growth or quality of life

By Everald Compton - posted Wednesday, 6 November 2013


Politicians and economists calculate the stature and prosperity of a nation by the annual percentage increase in its Gross Domestic Product. Governments rise and fall on the basis of this statistic, mainly because nations are declared to be in recession if there is negative GDP growth on three successive occasions.

However, the thoughts of many support the view that it is long overdue for this inadequate gauge of a nation's growth to be declared the farce that it is.

I want to suggest that it should be replaced by a new measure that could be called General Domestic Prosperity. This means that a GDP will still be calculated, but it will have a new meaning and a different basis of measurement.

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A fundamental and urgent reason for the change is that the world is now grossly overpopulated. Seven billion of us now occupy the planet, rising to 9.5 billion in 2050.

When I was born in 1931, there was a population of two billion and, even then, this was considered to be too many. Added to this is the current reality that half of the world does not have even a minimal standard of housing, and too many have neither water nor energy connected to those inadequate dwellings. Most live in poverty, have insufficient food and little education, all of which manifests itself in massive unemployment - a positive recipe for economic and social disaster.

It goes without saying that this crisis cannot be fixed by setting-out to remove excess population, although there can be a much more determined effort to curb population growth. No matter what the solution to over-population, it is indisputable that the crisis will give us no option but to make far better and smarter use of the world's overtaxed resources.

What is clearly evident is that even a very basic living standard will not be achieved just by striving to significantly increase the productivity of every nation. Nor will it be fixed by persevering with the outdated thought that greater prosperity eventually will trickle down from the wealthy, an economic theory which has never materialised, and never will. In fact, it is a blatant lie that has been perpetuated for centuries to justify unbridled plundering by a select few.

Even in prosperous nations like Australia there is no level playing field, and the basic reason for this deficiency is our obsession with economic growth while ignoring the social fundamentals that create quality of life in a nation.

A constructive start can be made on changing the way the world humanises its economics by calculating General Domestic Prosperity on a combined value calculation of all of these issues - Education, Housing, Health, Ageing, Innovation, Employment, Environment, Conservation, Opportunity and Stability.

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It will not be difficult to have an agreed international basis to calculate the quality contribution of each of those as assets of a nation. What is quite clear is that any nation that does not score well in such an assessment is not a good place to live, nor does it have a future.

We can pause for a moment to take a closer look at the impact of each one of them in the creation of an ideal nation.

  • The only way to overcome poverty in the long term is by universal access to a practical education which not only provides training for a career, but ensures a basic understanding of human relationships, community service, politics, government and money.
  • Having a home is a fundamental right of every human being, as is having a job. Yet provision of housing is largely in the hands of profit-makers, not social innovators, while employment is controlled by too many Unions protecting the privileged perks of too few workers.
  • Access to basic health facilities at minimal cost is another right of humanity, but the overuse and abuse of this right is an act of irresponsibility tolerated by most nations for political purposes while they massively neglect programs of preventative health that will retard the rapid growth in health costs.
  • As the world is ageing at lightning speed, the active involvement of the elderly in every facet of national life is now vitally essential. There can no longer be a permanent concept of a retirement age if the world is to avoid economic collapse.
  • Innovation must have a high rating as an essential element of calculating prosperity. Without rapid innovative change in the way we sustain and expand the good life in all of its facets, nations can only drift backwards.
  • The importance that a nation places on care of the environment and the conservation of all natural resources must have a heavier loading in the overall GDP calculation than all the above, as billions of people are polluting and destroying the planet while unnecessarily depleting its finite resources. Nations that fail to recycle resources must be rated with a minus.
  • No-one in the world can live without hope. Opportunity provided within a competitive arena can lead to a realisation of this hope. The denial of hope leads only to anarchy. Any nation that operates on the basis that an open marketplace will, by itself, provide opportunity for all must get a low GDP rating, as uncontrolled markets lead to the domination of a few.
  • Stability in economics, politics and social interaction clearly makes all of the above actually happen. But, it must be based on the unshakeable principle that no nation can spend money that it does not have, nor can it print money to keep itself going. Curbing all of the financial engineers who manipulate financial markets without creating a single job will be the first step.
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This article was first published on Everald@Large.



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About the Author

Everald Compton is Chairman of The Longevity Forum, a not for profit entity which is implementing The Blueprint for an Ageing Australia. He was a Founding Director of National Seniors Australia and served as its Chairman for 25 years. Subsequently , he was Chairman for three years of the Federal Government's Advisory Panel on Positive Ageing.

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