An Abbreviated Timeline of a Problematic Standard: the GDP
Written by JULIA SCHEERES
This sidebar is a supplement to Throwaway Nation
1937: Simon Kuznets, an economist at the National Bureau of Economic Research, formulates a new way to calculate the economic output of individuals, companies, and the government in a single measure: Gross Domestic Product, which is the value of all the goods that a country produces each year.
1944: The newly formed World Bank and the International Monetary Fund employ the GDP as the standard tool for sizing up economies, making it the defining economic indicator of the 20th century.
1959: Stanford economist Moses Abramovitz cautions that “we must be highly skeptical of the view that long-term changes in the rate of growth of welfare can be gauged even roughly from changes in the rate of growth of output.” In other words: A booming economy doesn’t translate into better living standards for all.
1968: U.S. presidential candidate Robert F. Kennedy takes aim at the GDP: “The gross national product does not allow for the health of our children, the quality of their education, or the joy of their play. It does not include the beauty of our poetry or the strength of our marriages, the intelligence of our public debate or the integrity of our public officials… It measures everything, in short, except that which makes life worthwhile. And it can tell us everything about America except why we are proud that we are Americans.”
1972: The king of Bhutan, Jigme Singye Wangchuck, announces that instead of using his country’s GDP, he’ll measure the Gross National Happiness of his subjects, based on psychological health, education, environmental conservation, and other indicators. That same year, French social philosopher André Gorz proposes shrinking, rather than growing, economies in a process he calls “Degrowth.”
1973: British economist Ernst Friedrich Schumacher publishes his landmark 1973 book, “Small is Beautiful: A Study of Economics as if People Mattered.” It proposes a standard of living based on human contentment, rather than consumption.
1990: The United Nations launches the Human Development Index—which tracks elements such as education, gender equality, and health—to assess a country’s development, rather than relying on economic growth alone.
2004: China implements a “Green GDP” to measure the environmental toll—such as pervasive smog, polluted rivers, and toxic waste—created by its economic boom.
2020s: As news about climate disruption and dwindling natural resources grows increasingly dire, the global Degrowth movement swells in numbers and begins to move into the mainstream.