Beyond GDP: How to Measure Progress

The European Commission published today a Communication on how to measure progress in a changing world. It proposes to go beyond the best known measure of economic activity, the Gross Domestic Product (GDP) and to develop more inclusive indicators that provide a more reliable knowledge base for better public debate and policy-making.

Stavros Dimas, Commissioner in charge of Environment, explained in a press conference that GDP was not intended to be a measure of wellbeing and does not pick-up on issue that are vitally important to the quality of lifes such as a clean environment, social cohesion or even how happy people are.

The Communication outlines five actions and among them it proposes a pilot of an environmental index that will assess progress in the main fields of environmental policy and protection. The index will cover areas such as greenhouse gas emissions, loss of natural landscapes, air pollution, water use and waste generation.

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Title
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General view of the press conference room
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SOUNDBITE (English) Stavros Dimas, EC Member in charge of Environment: GDP is a rigorous indicator for economic purposes and it will continue to play a role in political decision making. But GDP is no more than an indicator of economic activity. It was not intended to be a measure of wellbeing, it does not pick-up on issue that are vitally important to the quality of our lifes such as a clean environment, social cohesion or even how happy people are.
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Cutaway journalist attending the press conference
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SOUNDBITE (English) Stavros Dimas: A pilot of an environmental index will be proposed in 2010 that will assess progress in the main fields of environmental policy and protection. The index will cover areas such as greenhouse gas emissions, loss of natural landscapes, air pollution, water use and waste generation.
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SOUNDBITE (English) Elisabet Falemo, State Secretary to Andreas Carlgren, Swedish Minister for the Environment: The transformation to an eco-efficient economy requires other national indicators and tools in addition to GDP that provides better signals for policy makers regarding the path towards an eco-efficient economy.
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SOUNDBITE (English) Stavros Dimas: An example: if a country cuts down its forest and sells its timber, this will increase its GDP, but in the medium to long term, destroying the natural capital which is not measured will not be beneficial for the country, for the environment or for the wellbeing of the people.
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SOUNDBITE (English) Elisabet Falemo: I think that GDP is established rather well for what it stands for, but we need complementary systems. What it is important to know is that quality of life and welfare is not only material. And we need to put figures on even other qualities of life. In that way the GDP will not be the only way to measure the welfare.
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News & Politics

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• Simon Kuznets
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[bootylicification]

The debt when George W. Bush took office was $5.727 Trillion when he left it was $10.627. The debt/GDP increased by 27.1% in eight years of office (It was 83.4% when he left office).

.

Obama claims that his spending is reasonable better than Reagan. He proposed 3.7 Trillion with a deficit of 1.4 Trillion for 2011. Currently based on usdebtclock org, the debt/GDP is 97.2%. Obama in two years of office increased the debt/GDP by 13.8%.

.

Allen West 2012

[poldavo]

Interesting role of the Commission.... just a handful journalists attending this important meeting.

[loomingdespicens]

how....happy people...are

[WeAreTheEuropeanz]

P.S. Don't tkae the phrase "HDI + some environmental indicators" literally. By HDI I mean some social and economic indicators.

[WeAreTheEuropeanz]

Do I understand it right? Will it be HDI + some environmental indicators?

Anyway, this is a good initiative, it will help to highlight the importance of responsible usage of natural resources, etc. I'm glad that EU is taking the lead of suchlike understangind and responsibility.