Transcript Condition of Well-Being Accounts

Measuring Genuine Well-being:
The Genuine Progress Indicator
System of Sustainable Well-being
Accounts for Alberta
Atkinson Foundation Meeting
Toronto
October 1, 2001
Mark Anielski,
Director, Sustainability Measurement, Pembina Institute
Senior Fellow, Redefining Progress, Oakland CA
“The welfare of a nation
can scarcely be inferred
from a measurement of national income
as defined by the GDP…
goals for ‘more’ growth
should specify of what
and for what”
Simon Küznets
Pembina Institute
“The Gross National Product includes air pollution and advertising
for cigarettes, and ambulance to clear our highways of carnage. It
counts special locks for our doors, and jails for the people who break them.
GNP includes the destruction of the redwoods and the death of Lake
Superior. It grows with the production of napalm and missiles and nuclear
warheads. And if GNP includes all this, there is much that it does not
comprehend. It does not allow for the health of our families, the quality of
their education, or the joy of their play. It is indifferent to the decency of
our factories and the safety of our streets alike. It does not include the
beauty of our poetry or the strength of our marriages, or the intelligence of
our public debate or the integrity of our public officials. GNP measures
neither our wit nor our courage, neither our wisdom nor our learning,
neither our compassion nor our devotion to our country. It measures
everything, in short, except that which makes life worthwhile.”
Robert F. Kennedy
March 18, 1968
Redefining Economics
Economics
Wealth (Capital)
Oiko nomikus
Weal th
Household
Management Well-Being
sustainable “living capital” stewardship
Condition of
U.S. GPI.. declining economic welfare
$30,000
US $ per capita, 1992 chained dollars
$25,000
U.S. GDP per capita
$20,000
$15,000
U.S. GPI per capita
$10,000
$5,000
$1950
1955
1960
1965
1970
1975
1980
1985
1990
1995
Source: Data derived from spreadsheets from the U.S. Genuine Progress Indicator (GPI) for 1999. Redefining Progress, Oakland, CA.
www.rprogress.org
U.S. …making money, growing poor
26,000
21,000
U.S. Debt, Stock Markets, Economic Growth (GDP) vs.
Genuine Progress Indicator (GPI) and Environmental Depreciation
(in current US $)
U.S. Stock Market Capitalization Value
(NYSE/ASE/NASDQ)
16,000
Currency Govenrment Notes
U.S. GDP
11,000
U.S. Genuine Progress Indicator (GPI)
Value of Environmental Degradation &
Resource Depletion
6,000
1,000
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00
$ billions US (current dollars)
Total US Debt
(4,000)
Canada….better economic well-being?
U.S. vs. Canada GPI per capita
11000
Canada's GPI
9,000
8,500
10000
9000
8,000
7,500
8000
7,000
6,500
7000
US GPI
6,000
6000
5,500
5,000
5000
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62
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65
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68
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86
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92
19
95
U.S. GPI per capita (1992 US dollars)
9,500
US Per Capita GPI US $ 1992 constant
Canada Per Capita GPI Cdn. $ 1986 constant
Canada GPI per capita (1986 Cdn. dollars)
10,000
Genuine Progress Indicators (GPI) Sustainable Well-being
Accounting System
Quality of life needs and priorities
based on citizen input and dialogue
Key determinants of well-being
Economic
Well-Being
Quality of Life
Values
Societal and
Personal
Well-Being
Genuine
Progress
Indicators
Account
Spiritual
Well-Being
CPRN’s Quality of Life
Dialogue with Canadians
51 Indicators of Well-being
Environmental
Well-Being
(GPI) Sustainable Well-being Accounting System:
GPI Accounts
Social
Accounts
-Human Capital
-Social Capital
Economic
Accounts
- Economic Output
- Produced Capital
- Financial Capital
GPI Balance Sheet
Condition of
Well-Being Accounts
(qualitative/quantitative)
Genuine
Progress
Indicator
Account
Environmental
Accounts
-Natural Capital
- Ecosystem Services
GPI Sustainable Income
Statement
Full Cost & Benefit
Accounts ($$)
Elements of Well-being
Societal
Economic
Well-Being
Well-Being
Account
Account
•Economic Growth
•Poverty
•Economic Diversity
•Paid Work Time
•Trade
•Unemployment
•Disposable Income
•Underemployment
•Personal Expenditures •Parenting and Eldercare
•Taxes
•Leisure Time
•Debt
•Volunteerism
•Savings Rate
•Commuting Time
•Household Infrastructure•Family Breakdown
•Public Infrastructure
•Crime
•Income Inequality
•Democracy
•Intellectual Capital
•Life Expectancy
•Infant Mortality
•Premature Mortality
•Disease
•Obesity
•Suicide
•Substance Abuse
•Auto Crashes
•Gambling
Environmental
Well-Being
Account
•Ecological Footprint
•Ecosystem Health
•Carbon Budget
•Energy Efficiency
•Oil and Gas Reserve Life
•Agriculture Sustainability
• Timber Sustainability
•Wetlands-Peatlands
•Fish & Wildlife
•Air Quality
•Water Quality
•Toxic Waste
•Landfill Waste
Societal Well-being Indicators Account
Societal and Personal Well-being
Indicators
• Poverty (% living below LICO
and a Living Wage);
• Income distribution (Gini
coefficient)
• Unemployment rate
• Underemployment rate
• Paid work (time use)
• Household work (time use)
• Parenting and eldercare (time use)
• Free (leisure) time
• Volunteer time
• Commuting time
• Life expectancy
• Premature mortality
• Infant mortality
• Obesity
• Suicide
• Youth drug use
• Auto crashes
• Divorce and family breakdown
• Crime
• Problem gambling
• Voter participation
• Educational attainment
Societal and
Personal
Well-Being
Account
Genuine
Progress
Indicators
Economic
Well-being
Account
Environmental
Well-being
Account
Regrettable Societal Costs and Benefits **
• Value of housework
• Value of parenting and eldercare
• Value of volunteer work
• Value of free time
• Cost of unemployment and
underemployment
• Cost of auto crashes
• Cost of commuting
• Cost of crime
• Cost of family breakdown
• Cost of suicide
• Cost of gambling
• Cost of obesity and unhealthy lifestyles
• Cost of gambling
• “Cost” of income inequality (GDP
adjusted by the Gini coefficient for
income inequality)
* Indicators are expressed in non-monetary
units or normalized qualitative indices.
** All values are expressed in monetary units which
can be used to generate the GPI Net Sustainable
Income statement adjusting GDP for unaccounted
benefits and costs.
Environmental Well-being Accounts
Environmental Well-being
Indicators*
• Conventional crude oil and
natural gas reserve life
• Oilsands reserve life
• Energy use
• Agriculture sustainability
(composite index)
• Timber sustainability index
• Forest fragmentation
• Parks and wilderness
• Fish and wildlife population
health
• Wetlands
• Peatland
• Water quality
• Air quality
• Greenhouse gas emissions
• Carbon budget deficit
• Hazardous waste
• Landfill waste
• Ecological footprint
Environmental
Well-being
Account
Genuine
Progress
Indicators
Economic
Well-being
Account
Societal
Well-being
Account
Regrettable Environmental and
Natural Capital Depreciation
Costs**
• Cost of public and private
environmental clean-up
• Cost of toxic waste management
• Cost of household/business waste
management and pollution control
costs
• Deprecation cost of nonrenewable
resource use
• Cost of long-term environmental
damage from fossil fuel use
• Cost of unsustainable forest
resource use
• Cost of loss of farmland
• Cost of loss of wetlands and
peatlands
• Cost of loss of wildlife and fisheries
• Cost of loss of ecosystem services
• Cost of air pollution
• Cost of water pollution
* Indicators are expressed in non-monetary
Units or normalized qualitative indices.
** All values are expressed in monetary units which
can be used to generate the GPI Net Sustainable
Income statement adjusting GDP for unaccounted
benefits and costs.
Economic Well-being Accounts
Full costs and benefits of
economic output, produced,
and financial capital
Economic Well-being
Indicators
• Economic growth (real GDP
per capita)
• Economic diversity
(distribution of GDP by
sector)
• Trade balance (exports less
imports)
• Real disposable income
• Real weekly wages
• Personal consumption
expenditures
• Transportation expenditures
• Taxes (real $ per capita)
• Household and personal debt
per capita
• Savings rate
• Public infrastructure (value
of services)
• Household infrastructure
(value of services)
EconomicWell-being
Account
Genuine
Progress
Indicators
Societal
Well-being
Account
Environmental
Well-being
Account
• Gross Domestic Product
(GDP)
• Personal Consumption
Expenditures (PCE)
• PCE adjusted for income
inequality/distribution
(“cost” of inequality)
• Non-defensive government
expenditures
• Value of services of consumer
durables
• Cost of consumer durables
(regrettable depreciation)
• Value of public
infrastructure services
• Net capital investment
• Cost of household and
personal debt servicing
• (see also, Societal costs)
* Indicators are expressed in non-monetary
units or normalized qualitative indices.
** All values are expressed in monetary units which
can be used to generate the GPI Net Sustainable
Income statement adjusting GDP for unaccounted
benefits and costs.
A Portrait of Alberta’s Condition of Well-being
(GPI Balance Sheet) Diagnosis 1999
Educational attainment
Poverty
100
Income distribution
90
Voter participation
Unemployment
Societal and
Personal Health
Conditions
80
70
Problem gambling
Underemployment
60
50
Crime
Paid work time
40
30
20
Family breakdown
Household work
10
-
Auto crashes
Parenting and eldercare
Drug use (youth)
Economic
Well-being
Conditions
Free time
Suicide
Volunteerism
GHG emissions
Air quality
Economic growth
100
90
Household infrastructure
Premature
80mortality
Personal expenditures
Transportation expenditures
70
Water quality
Taxes
60
Peatlands
Savings rate
50
Economic diversity
Ecological footprint
Wetlands
Household debt
Fish and wildlife
Public infrastructure
50
40
30
Parks and wilderness
Landfill waste
Household infrastructure
20
Trade
Forest fragmentation
10
-
Timber sustainability
Energy use
70
50
Agricultural sustainability
Income distribution
40
Agricultural sustainability
Unemployment
Energy use
30
Underemployment
20
10
Oilsands reserve life
Disposable income
Carbon budget deficit
Educational attainment
Voter participation
Problem gambling
Crime
Family breakdown
crashes
Weekly wageAuto
rate
Drug use (youth)Suicide
10
Paid work time
Oil and gas reserve life
Savings rate
80
60
Poverty
Hazardous waste
20
-
Oilsands reserve life
90
Public infrastructure
30
70
60
Oil and gas reserve life
100
40
80
Household debt
Environmental
Well-being
Conditions
Economic growth
Ecological footprint
Economic diversity Commuting time
Landfill waste
Trade
100
Hazardous waste
Disposable income
Carbon
budget
deficit
Weekly wage rate
Infant
mortality
Life expectancy
90
Obesity
Timber sustainability
-
Household work
Parenting and eldercare
Free time
GHG emissions
Volunteerism
Forest fragmentation
Commuting time
Life expectancy
Premature mortality
ObesityInfant mortality
Air quality
Taxes
Personal expenditures
Transportation expenditures
Parks and wilderness
Water quality
Fish and wildlife
Peatlands
Wetlands
Alberta’s Condition of Well-being Diagnosis for 1999:
The GPI Sustainability Circle Index
Economic growth
Ecological footprint
Economic diversity
Landfill waste
Trade
100
Hazardous waste
Disposable income
Carbon budget deficit
Weekly wage rate
90
GHG emissions
Air quality
Water quality
80
70
Personal expenditures
Transportation expenditures
Taxes
60
Peatlands
Savings rate
50
Wetlands
Household debt
40
Fish and wildlife
Public infrastructure
30
Parks and wilderness
20
Forest fragmentation
10
Household infrastructure
Poverty
-
Timber sustainability
Income distribution
Agricultural sustainability
Unemployment
Energy use
Underemployment
Oilsands reserve life
Paid work time
Oil and gas reserve life
Household work
Educational attainment
Parenting and eldercare
Voter participation
Problem gambling
Crime
Family breakdown
Auto crashes
Drug use (youth)Suicide
Free time
Volunteerism
Commuting time
Life expectancy
Premature mortality
ObesityInfant mortality
Historical Portraits of Well-being
1999
Economic growth
Ecological footprint
Economic diversity
Landfill waste
Trade
100
Hazardous waste
Disposable income
Carbon budget deficit
Weekly wage rate
90
GHG emissions
Economic
growth
Transportation
expenditures
Ecological footprint
Economic diversity
Landfill waste 100.00
Trade
70
Taxes
Hazardous waste
Disposable income
Carbon
Weekly wage rate
90.00
60 budget deficit
Savings rate
GHG emissions
Personal expenditures
50
80.00
Air quality
Transportation expenditures
Household debt
Water quality
Peatlands
Wetlands
40
70.00
30
60.00
20
50.00
10
40.00
Poverty
30.00
Income distribution
Water quality
Fish and wildlife
Peatlands
Parks and wilderness
Wetlands
Forest fragmentation
Fish and wildlife
Timber sustainability
-
Parks and wilderness
Savings rate
Household infrastructure
Household debt
Public infrastructure
Economic
growth
Household
infrastructure
Ecological footprint
Disposable income
Carbon budget deficit 100.00
Weekly wage rate
GHG emissions
Personal expenditures
Poverty
90.00
Underemployment
Air quality
Transportation expenditures
80.00 distribution
Income
Taxes
Paid workPeatlands
time
Unemployment
10.00
Forest fragmentation
Taxes
Public infrastructure
20.00
Agricultural sustainability
Energy use
-
Timber sustainability
Oilsands reserve life
1998
Personal expenditures
80
Air quality
70.00
Oil and gas reserve life
Agricultural sustainability
Educational attainment
Energy use
Voter participation
Wetlands
Household
work
Unemployment
Parenting
eldercare
Fish and and
wildlife
Underemployment
50.00
Free time
Oilsands reserve life
Problem gambling
Household infrastructure
20.00
Parenting and eldercare
10.00
Free time
Poverty
-
Volunteerism
Energy use
Crime
Commuting time
Family breakdown
Life expectancy
Oilsands reserve life
Auto crashes
Premature mortality
Drug use (youth)Suicide
ObesityInfant mortality
Oil and gas reserve life
The worst
Public infrastructure
30.00
Household work
Commuting
Timbertime
sustainability
Life expectancy
Premature mortality
ObesityInfant mortality Agricultural sustainability
Problem gambling
1961
Household debt
40.00
Paid work
time
Forest fragmentation
Volunteerism
Oil
and gas reserve life
Crime
Family breakdown
Educational
attainment
Auto crashes
Drug use (youth)Suicide
Voter participation
Savings rate
60.00
Income distribution
Unemployment
Note: 51 of 51 indicators
Underemployment
Educational attainment
Paid work time
Voter participation
Household work
Problem gambling
Parenting
eldercare
Note: 42 ofand
51 indicators
Crime
Free time
Family breakdown
Volunteerism
Auto crashes
Commuting time
Suicide
Life expectancy
Premature mortality
The best
Alberta Economic Growth vs. Genuine Progress Index
100.0
90.0
GDP Growth Index
Index (where 100=best)
Best year: 1999
Worst year: 1961
80.0
70.0
60.0
GPI Well-Being Index
50.0
Best year: 1961
Worst year: 1998
40.0
1961
1966
1971
Source: Alberta GPI Accounts 1961-1999
1976
1981
1986
1991
1996
1999
The GPI Sustainable Income statement
GDP – personal consumption expenditures
• adjust for income inequality
+ value of unpaid work (housework, parenting, volunteerism)
+ value of the household and public infrastructure
- cost of household debt servicing
- value of the loss of human and social capital:
- loss of leisure time
- cost of underemployment and unemployment
- cost of divorce, suicide, auto crashes, divorce,
gambling
-value of natural capital depreciation:
- nonrenewable natural capital (minerals, oil, gas,coal)
- unsustainable renewable natural capital (forests, agriculture)
-cost of loss of ecosystem services:
- (carbon sequestration, air pollution,water pollution, forests, wetlands,
and peatlands)
= Net Sustainable Income (output)
Alberta GDP versus Sustainable Economic Welfare
38,500
33,500
The value of unpaid work is
estimated at $38.8 billion
(1998$) or 35.4% of Alberta’s
GDP in 1999.
Alberta GDP
1998 dollars per capita
28,500
23,500
The social and human capital
costs are estimated at $23.4
Alberta GPI
billion (1998$) or 21.3% of
(net sustainable income)
Alberta’s GDP.
18,500
13,500
8,500
Total environmental costs and
natural capital depreciation is
estimated at $26.4 billion
(1998$) or 24.0% of Alberta’s
GDP.
3,500
-1,5001961
1966
1971
1976
1981
Source: Alberta GPI Accounts, GPI income statements, 1961-1999
Pembina Institute
1986
1991
1996
1999
Pictures at the Exhibition:
The Story of Alberta’s Well-being
and Sustainability
Pembina Institute for Appropriate Development, January 2001
20
Household debt
-
Disposable income
Savings rate
Weekly wage rate
Taxes
Personal expenditures
Transportation expenditures
Noteworthy:
 Real household debt per capita grew by 3.8% per annum
from 1961 to 1999, surpassing
the 2.1% per annum growth in
real disposable income and
the 2.2% per annum growth in
real GDP per capita.
 Albertans are financially
stressed with 23% reporting
in a 1999 national survey that
they would not have enough
savings to last one month.
 We estimate the total of all
debt (household, business,
farm, and all government) per
Albertan in 1999 at $60,441
(1998$); it has increased
355% since 1961, which
represents 163% of GDP .
 While real per capita household debt grew at a rate of
11.3% per annum, real disposable income only grew at 2.1%
per annum.
Debt in Alberta: How Much?
Financial debt burdens
individuals, households,
students, businesses, farmers,
and government. Debt
financing fuels economic
growth, investment and
consumption by households,
business and even governments.
Genuine progress is made if the
levels of debt do not become
excessive in relation to
disposable income and
spending power. At the
household and personal level,
debt is soaring even as the
$25,000
 We estimate the cost of household
debt servicing in 1999 at $6.6 billion
on roughly $64 billion (1998$) in
total outstanding household debt.
This expenditure is roughly 6% of
Alberta’s 1999 GDP.
1998$ per capita
 The cost of household debt servicing is based on an estimate of the
interest payments on chartered
bank consumer loans.
household debt per Albertan
has increased from 57% to
109% of real disposable
income from 1961 to 1999.
When we add Albertans’
share of outstanding federal
government debt, Alberta
Government Debt, municipal
government debt, and
business debt, the average
total debt per Albertan in
1999 was $60,441 (1998$), or
322% of average real
disposable income.
Alberta Household Debt vs. Disposable Income and Consumption
Spending
$20,000
The Cost of Household Debt in Alberta:
What is included?
Alberta Government
eliminates its debt. For our
analysis, we used Statistics
Canada data for personal and
household debt at the national
level and estimated Albertans’
share of this debt. Our
analysis shows that household
debt rose from $5,204 per
Albertan (1998$) in 1961 to
$21,172 (1998$) in 1999—a
307% increase. Real
disposable income increased
only 113% over the same
period. The average
Disposable Income
$15,000
Household Debt
$10,000
The GDP counts expenditures on debt
servicing as additions to economic growth. In
most cases, debt is a regrettable financial
burden that diminishes the economic wellbeing of households, businesses and
governments. The figure at the upper right
shows that while GDP (as an index) continues
to rise, the amount of household indebtedness
(as an index) is also increasing. Do increasing
levels of financial debt feed economic growth?
Economists such as Herman Daly have
identified that a basic growth bias is built into
the economy by the nature of our debt-based
money creation system, with total debt
growing forever and being fundamentally
unrepayable from current earnings. Since
money creation (through debt) is a synthetic
process that encourages making money from
money, there is a fundamental need to address
the long-term costs of this system to genuine
well-being and sustained stewardship of
“living” capital.
Alberta Debt Index: Where are we today?
100
100
90
90
80
80
70
70
60
60
50
50
40
40
30
30
20
Less Debt
20
Economic Growth
10
10
Debt
-
1961
1966
1971
1976
1981
1986
1991
More Debt
1996
The GPI accounts identify debt as detracting
from genuine well-being. The figure at the
Costs of Household Debt Servicing vs. Disposable Income, Alberta
lower right shows the real costs per capita of
1961-1999
household debt servicing compared to real
disposable income. Average real costs of
household debt servicing in 1999 are estimated
$3,000
$25,000
at $6.5 billion or $2,145 per Albertan (1998$).
Total real debt servicing increased 330% from
$2,500
1961 to 1999 while real disposable income per
Per capita real disposable income
$20,000
capita only rose 113% over the same period.
Government debt servicing detracts from
$2,000
economic well-being by diverting monies that
$15,000
could have been spent on public programs and
services to enhance well-being. For example,
$1,500
roughly 29 cents on every tax dollar paid to the
$10,000
federal government in 1999 went to service the
$1,000
federal debt. Genuine progress will be made
Household debt servicing costs per
when a) we begin to explore alternative money
capita, 1998 dollars
$5,000
systems to replace fractional reserve banking
$500
and a debt-based money system, and b) we
perhaps adopt a total capital and GPI system of
$0
$well-being accounts that informs and guides
1961
1966
1971
1976
1981
1986
1991
1996
national monetary policy and money creation.
Source: Debt servicing costs were estimated by the authors using the average consumer loan rate of Chartered Banks applied to total
personal and household debt estimates for Alberta (based on Statistics Canada national data; Table 378-0003: National balance sheet,
credit market summary.
$5,000
Including household, farm, Alberta Government, and municipal government debt, as well as
business debt in Alberta, and Alberta’s share of federal government debt, the total debt bill for
1999 was $179.2 billion (1998$). As an index, household (personal debt) per capita in Alberta
in 1999 scored 24.6 on a scale of 0 to 100, where 100 is the lowest level of real household debt
per capita that occurred between 1961 and 1999.
Personal Consumption
Expenditures
$1961
1966
1971
1976
1981
1986
1991
1996
Source: Debt figures estimated for Alberta from Statistics Canada, Table 378-0003 , National balance sheet, credit market
summary; Expenditures and Disposable Income figures from Alberta Economic Accounts 1999
$17
9
B il . 2
li o n
Real disposable income per capita, 1998 $
So What?
Trade
40
Debt Index, benchmark year =100
60
Public infrastructure
Indicator # 10, HOUSEHOLD DEBT
Household deb servicing costs, 1998 $ per capita
Household
Debt
Economic diversity
80
GDP Index, benchmark year =100
Economic growth
100
Household infrastructure
ENVIRONMENTAL
WELL-BEING
Genuine Progress Indicators (GPI)
GPI
Condition
Index in 1999
(100 = best)
(0 = worst)
20
Best Year
Worst Year
*
Oilsands reserve life
79
1979
1998*
Energy use
44
1962
1999*
Agriculture sustainability
62
1999
1961*
Timber sustainability
79
1994
1998*
Forest fragmentation
11
1961
1999*
Parks and wilderness
33
1999
1995*
Fish and wildlife
45
1980
1999*
Wetlands
40
1961
1999*
Conventional crude oil and natural
gas reserve life
1966
1999*
Trend
19611999
Description of Trend
Natural gas and conventional crude oil
reserves continue to decline with
replacements not keeping pace with
extraction.
Oilsands reserves are relatively constant
given that there an estimated 300 billion
barrels of economic reserves of oil that
could last hundreds of years.
Total energy demand (intensity of use)
continues to rise at a rate of 2.2% per
annum, per capita, similar to the GDP per
capita.
The agriculture sustainability index (a
composite index of yields, soil organic
carbon, summer fallow, pesticide use and
salinity) has increased somewhat in the
1980s and 90s. However, increasing farm
debt, and fertilizer and pesticide use may
become problematic.
The Timber Sustainability Index (ratio of
timber growth to all timber capital
depletions) continues to decline falling
below sustainable thresholds in 1998 and
1999.
The fragmentation of Alberta’s forests
(due to industrial development) has risen
so dramatically since the 60s that an
estimated 90% of Alberta’s vast
productive forest land base is now
fragmented.
While the area of parks and wilderness
under protection has increased slightly, not
all landscape types are adequately
represented.
Caribou populations are falling; grizzly
bear populations are uncertain, and sport
and commercial fishing are declining.
Area of wetlands has declined at an
estimated 0.6% per year since 1961.
GDP grows but to whose benefit?
40,000
GDP Per Capita (1998$)
30,000
Despite increasing
economic growth since
1981, average real
disposable incomes
have stagnated since
peaking in 1981.
35,000
30,000
25,000
25,000
20,000
20,000
15,000
15,000
In a 1999 national survey, 23% of
Albertans (highest in Canada)
said they would not have enough
savings to sustain themselves
beyond one month’s salary.
(Source: Canadian Council on Social Development)
10,000
Economic growth
5,000
Disposable income
-
10,000
5,000
1961
1966
1971
1976
1981
1986
1991
1996
Personal Disposable Income Per Capita (1998$)
35,000
40,000
Economic well-being at risk?
24,800
Disposable income
19,800
1998 dollars per Albertan
Personal consumption
expenditures
14,800
Personal and household debt
9,800
Taxes on persons
4,800
Savings
(200)
1960
1965
1970
1975
1980
1985
1990
1995
1999
Sources: Alberta Treasury, Alberta Economic Accounts 1999; Statistics Canada, CANSIM Table 384-0035 and Table 384-0012 (92-99)
Pembina Institute
Another day older….
40,000
7,000.00
35,000
6,000.00
30,000
25,000
4,000.00
20,000
Premature mortality from all causes has been
declining steadily since 1980; the average life
expectancy of Albertans (men and women) has
increased more than 7 years from 72.0 years in 1961
to 79.3 years in 1999.
15,000
10,000
Economic growth
3,000.00
2,000.00
1,000.00
5,000
Premature mortality
-
1961
1966
1971
1976
1981
1986
Pembina Institute
1991
1996
Premature Mortality
GDP Per Capita (1998$)
5,000.00
…. and deeper in debt
40,000
GDP Per Capita (1998$)
30,000
Household debt servicing costs now exceed real
disposable income for the first time in history. The
average household debt per Albertan has almost
doubled in 40 years from 57% of real disposable
income in 1961 to 109% in 1999
45,000
35,000
25,000
While real per capita household debt
grew at a rate of 11.3% per annum, real
disposable income grew by only 2.1%
per annum (1961-1999).
20,000
25,000
15,000
15,000
10,000
5,000
Economic growth
5,000
Household debt
-
(5,000)
1961
1966
1971
1976
1981
1986
Pembina Institute
1991
1996
Debt per Capita (1998$)
35,000
55,000
More GDP…more poverty?
35,000
GDP Per Capita (1998$)
30,000
25,000
30
Between 1961 and
1999, the level of
poverty (LICO)
increased 37.1%;
Alberta had Canada’s
third lowest poverty rate
25
20
20,000
15
15,000
We estimated roughly 20% of
Albertans used the provinces 74 food
banks; 17.2% of households are
estimated to live below a living wage
($24,332 per annum for family of
four).
10,000
Economic Growth
5,000
Poverty
-
10
5
1961
1966
1971
1976
1981
1986
Pembina Institute
1991
1996
Poverty (% of all persons living below the low income cut-off)
40,000
GROWING GAP: Gap Between Alberta’s Rich (Top Income Quintile)
and the Poor (Lowest Income Quintile) Comparing Incomes on a Before
Government Transfers, After Taxes, and Total Income Basis, 1981 to 1998
Ratio of top 20% of income group to lowest 20%
15.00
13.00
Market income inequality
11.00
9.00
Total income inequality
(after Government transfers)
7.00
5.00
After-tax income
inequality
3.00
1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
Source: Statistics Canada, "Income Inequality within provinces", Dimitri Sanga, Perspectives, Winter 2000, Catalogue No. 75-001-XPE, Table, p. 35
Hourly Income Comparisons, Alberta, 1998
Jubilee?
Minimum wage earner
Welfare Single Mom with two children
Poverty/Living Wage
Youth (15-24) Median Wage Earner
Average Personal Income of Albertans
Average Canadian Worker
Federal Public Servant
Registered Nurses
Teachers (Edmonton Public Schools)
$5.90
$6.16
$7.60
$7.75
$14.20
$16.15
$17.19
$23.48
$25.86
$52.34
Edmonton Mayor Bill Smith
Calgary Mayor Al Duerr
Premier Ralph Klein
Top Provincial Deputy Ministers
Sheila Weatherill, President, Capital Health Authority
Top Federal Government Bureaucrat
Mary Cameron, President, Alberta WCB
Average CEO Salary
Average Salary of Top 100 Canadian CEOs
The top 20% income group of Albertans
earned 14.5 times more than the lowest
20% almost double the ratio of 8.2 in
1980.
$58.33
$63.33
$70.42
$123.96
$125.00
$185.26
The eight wealthiest Albertans earned an
estimated 5,645 times more per hour
than an Albertan working full-time at
the minimum wage.
$448.96
$1,822.92
$33,307.29
Richest 8 Albertans (Average)
$-
$5,000.00
$10,000.00
Source: 2. "Who's worth what, Who's Paid What, Where the Money Goes", Special
Report, National Post, April 22, 2000; Alberta Public Accounts 1999-2000
$15,000.00
$20,000.00
$25,000.00
$30,000.00
$35,000.00
Less time with the kids but more GDP
200
180
35,000
160
30,000
GDP Per Capita (1998$)
140
25,000
120
20,000
100
The value of unpaid work in Alberta in 1999
is estimated at $38.8 billion (1998$) or 35.4%
of Alberta’s GDP.
15,000
80
60
10,000
40
Economic growth
5,000
Parenting and eldercare
Nearly 70% of full-time employed, married
mothers feel rushed and stressed on a daily
basis
-
20
1961
1966
1971
1976
1981
1986
1991
1996
Parenting and Eldercare (hours per person 15 years and over per
year)
40,000
More divorces add to GDP growth
55%
The rate of divorce rose
4.6% per annum
compared to real GDP
growth of 4.4% per
year, 1961 to 1999
35,000
GDP Per Capita (1998$)
30,000
45%
35%
25,000
20,000
25%
The estimated cost of divorce and family
breakdown in Alberta in 1999
is estimated to contribute $148 million(1998$)
to Alberta’s economic growth.
15,000
10,000
5%
Economic growth
5,000
15%
Family breakdown
-
-5%
1961
1966
1971
1976
1981
1986
Source: Statistics Canada, CANSIM special retrieval and Alberta Economic Accounts 1999
1991
1996
Family Breakdown (% of marriages that end in divorce)
40,000
Rising suicide adds to the GDP
$40,000
20.0
18.0
$35,000
16.0
$30,000
$25,000
12.0
Suicide is the leading
cause of death amongst
Calgary males aged 1049 years.
$20,000
$15,000
10.0
8.0
6.0
GDP at market prices, expenditure
based (1998$ per capita)
Suicide rate for both sexes per
100,000 population
$10,000
4.0
$5,000
2.0
$-
1961
1966
1971
1976
1981
1986
Pembina Institute
1991
1996
Suicide rate per 100,000
GDP per capita (1998$)
14.0
Health of democracy?
40,000
100
90
35,000
80
GDP Per Capita (1998$)
70
25,000
60
20,000
50
40
15,000
30
10,000
20
Economic growth
5,000
Voter participation
10
-
-
1961
1966
1971
1976
1981
1986
Pembina Institute
1991
1996
Democracy (voter participation %)
30,000
Growing Ecological Deficits…
40,000
12.0
35,000
GDP Per Capita (1998$)
30,000
8.0
25,000
20,000
Alberta has the fourth largest ecological
footprint in the world after the United Arab
Emirates, Singapore and the United States of
America.
15,000
6.0
4.0
10,000
2.0
Economic growth
5,000
Ecological footprint
-
0.0
1961
1966
1971
1976
1981
1986
Pembina Institute
1991
1996
Ecological Footprint (hectares per capita)
10.0
Alberta’s Footprint, fourth largest in the world….
5 times the global ecological carrying capacity
13
11.9 ha
12
Alberta
10.7 ha
11
10
9
8
[ha/capita]
7.4 ha
7
6.3 ha
6
5
5.2 ha
Global Biological Capacity
4
3.6 ha
2.8 (per capita ecological footprint)
3
2.5 ha
1.8 (per capita global biocapacity)
2
1.4 ha
1
0.8 ha
10%
10%
54%
0
% of global population
Pembina Institute
3%
11%
3% 2% 5%
Depleting oil and gas capital…more GDP
$40,000
45
There are less than 10 years of natural gas
reserves remaining, based on current production
and stocks. However, Alberta has more oil in the oil
sands than Saudi Arabia’s official reserves, more
than 300 years of production.
GDP per capita( 1998$)
$30,000
40
35
30
$25,000
25
$20,000
20
$15,000
15
$10,000
GDP at market prices, expenditure
based (1998$ per capita)
Crude Oil and Natural Gas Reserve
Life Average
$5,000
10
5
The estimated cost of depreciation of nonrenewable resources is
estimated at $10.6 billion in 1999 or 9.7% of GDP.
$-
0
1961
1966
1971
1976
1981
1986
1991
1996
Crude Oil and Natural Gas Reserve Life (years remaining)
$35,000
Depleting timber capital…more GDP
$40,000
4.00
$35,000
3.50
$30,000
3.00
$25,000
2.50
$20,000
2.00
$15,000
1.50
GDP at market prices, expenditure
based (1998$ per capita)
$10,000
1.00
Timber Sustainability Index, the ratio
of annual increment (growth) divided
by total harvest, energy and
agriculture depletions
$5,000
0.50
$-
1961
1966
1971
1976
1981
1986
1991
1996
Timber Sustainability Index (ratio of growth to depletions)
GDP per capita (1998$)
More than 90% of Alberta’s forests are fragmented
Growing Carbon budget deficit…more GDP
40,000
35,000
5
The estimated cost of Alberta’s carbon emissions
to global warming in 1999 are estimated at $4.1
billion (1998$) or 3.7% of Alberta’s GDP.
4
25,000
3
20,000
2
15,000
Economic growth
10,000
Carbon budget deficit
Carbon budget deficit
1
Carbon budget surplus
5,000
-
1961
1966
1971
1976
1981
Pembina Institute
1986
1991
1996
Carbon Budget
GDP Per Capita (1998$)
30,000
Water quality improving but is it sustainable?
40,000
100
90
35,000
80
30,000
25,000
60
20,000
50
40
15,000
While surface (river) water quality has improved
very little is known about the long-term
sustainability of Alberta’s groundwater aquifers.
10,000
5,000
Economic growth
30
20
10
Water quality
-
1961
1966
1971
1976
1981
1986
1991
1996
Water Quality Index
GDP Per Capita (1998$)
70
Next Steps….
GPI Sustainability Accounting and Reporting
National GPI Accounts:
Canada, U.S.
GPI Accounts for
Ontario, Quebec, B.C., Alberta
Maritimes
Quality of Life Indicators
Global Reporting Initiative (GRI)
National GPI
Provincial/State GPI
Local GPI
Corporate GPI
For additional information:
www.pembina.org
[email protected]
Pembina Institute