Transcript GEOG 352: Day 13 – Changing the Metrics

GEOG 352: Day 13 –
Changing the Metrics
Housekeeping Items
Today, one of the debate is postponed yet again. However, we do have the
Seeds group.
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Ian and Craig need to remind me as to when they're presenting their book
reports. Also: this is the schedule for the tool presentations (Rob, David and
Tracy TBA):
name
date
topic
Rick
March 2
land trusts?
Samantha
March 4
CBA (Olympics)
Matt
March 4?
alts. to GDP
Julian
March 11
hedonic pricing?
Shaunda
March 11
?
Dan
March 16
company profile?
Alan
March 16
Happy Planet Index
Ian
March 16 (18?)
?
Rich
March 23
human capital/ immig.
Bob
March 23
EA/ full-cost account.
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Porritt on “Changing the Metrics” -A Few Highlights
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How is Gross Domestic Product (GDP)
defined and what are some of its main
deficiencies?
One of its strengths is that it measures
growth. Is growth essential to a capitalist
economy? Is a steady-state economy actually
possible?
Is it the case that capitalism is “all that is on
offer” at the present?
Porritt on “Changing the Metrics” -A Few Highlights
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Please look at Anielski and the web link
mentioned in the syllabus for Wednesday. For
now, a main point that is that to measure whether a
society is getting better or worse through growth
and economic activity, one must take into account
the net impact on natural (and possibly social)
capital [see the example about the impact of
logging activity in the Yangtze Basin in China].
Currently, we calculate national income by
subtracting capital depreciation from GDP, but not
natural capital depreciation.
Porritt on “Changing the Metrics” -A Few Highlights
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One of the most popular alternatives to GDP, invented
by Herman Daly and John Cobb and since refined by
others, is the Index of Sustainable Economic Welfare
(ISEW).
These researchers suggest that in most countries where
ISEW measurements have been attempted, economic
welfare (which includes natural capital and the degree of
socio-economic equality) has been declining since the
late 1970s.
Porritt notes that these findings would be further
strengthened if combined with quality of life surveys, a
gap that Mark Anielski has tried to address.
Porritt on “Changing the Metrics” -A Few Highlights
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Another metric is the UN Development Program's Human
Development Index. This is based on three main components:
life expectancy, education and literacy levels, and GDP per
capita.
Another one is Resource Efficiency Index. Most developed
countries have seen a decline in throughput intensity per unit
of production – that is, consumption of resources ('total
material requirement') has not kept pace with growth in GDP,
indicating a partial 'decoupling'.
Paul Ekins suggests that the environmental intensity of
consumption in the rich countries has to become a 1/10th of
what it currently is, and thereafter decline more rapidly than
any growth. Is this possible?
Porritt on “Changing the Metrics” -A Few Highlights
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See the list of all the different ways this decoupling needs to
occur.
Porritt and others have also been working on ways of
measuring well-being (see the well-being map). What do you
think of the result? Does this match at all your definitional
criteria for a sense of personal well-being, and what if
anything would you substitute?
Porritt notes how much the economy has changed in the last
50 years – what are some of principal changes, and what are
some of the ways it is likely to change in the future?
Given the important role of price in a capitalist society in
sending economic signals, Porritt is a big proponent of using
green taxes to change the prices of things in the marketplace.
Porritt on “Changing the Metrics” -A Few Highlights
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He cites Ekins on the potential benefits of green taxes. [See
also the box on 'old' and 'new' approaches to taxation.]
He addresses the important issue of avoiding regressivity –
having taxes fall disproportionately on those of lower income.
Giving everyone access to a minimum of untaxed resources
(as is practiced by Portugal and Holland), and providing
rebates, are two ways this can be achieved.
He also offers advice on how to make taxes more palatable.
He discusses the one-time Canadian proposal for a Tobin Tax
on all foreign exchange transactions, which is aimed at
speculative currency trading (one can think of other forms of
speculation that arguably should be taxed) and which could
bring in enormous resources for global development goals.
Porritt on “Changing the Metrics” -A Few Highlights
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He talks about perverse subsidies and how much they cost the
taxpayer. Any ideas as to why these are so hard to remove?
How do we find the courage as a society, and through our
politicians, to make the bracing changes that were needed in
the past to eliminate choking air pollution and streets running
with sewage, and to make our own misdeeds and irrational
practices appear quaint in the future?
He talks about Rich's idea of the carbon quotient – equal for
every person on the planet, and how certain industry sectors
will prosper in a low-carbon economy and others will wither.
He notes that, given our short-sighted instant-gratification
society, it will involve significantly greater challenges
introducing carbon rationing than wartime food rationing.