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TechnoratiOur Three-Decade Recession
The American quality of life has been going downhill since 1975.
The news media and the government are fixated on the fact that the U.S. economy may be headed into a recession -- defined as two or more successive quarters of declining gross domestic product. The situation is actually much worse. By some measures of economic performance, the United States has been in a recession since 1975 -- a recession in quality of life, or well-being.
How can this be? One first needs to understand what GDP measures to see why it is not an appropriate gauge of our national well-being.
GDP measures the total market value of all goods and services produced in a country in a given period. But it includes only those goods and services traded for money. It also adds everything together, without discerning desirable, well-being-enhancing economic activity from undesirable, well-being-reducing activity. An oil spill, for example, increases GDP because someone has to clean it up, but it obviously detracts from well-being. More crime, more sickness, more war, more pollution, more fires, storms and pestilence are all potentially positives for the GDP because they can spur an increase in economic activity.
GDP also ignores activity that may enhance well-being but is outside the market. The unpaid work of parents caring for their children at home doesn't show up in GDP, but if they decide to work outside the home and pay for child care, GDP suddenly increases. And even though $1 in income means a lot more to the poor than to the rich, GDP takes no account of income distribution.
In short, GDP was never intended to be a measure of citizens' welfare -- and it functions poorly as such. Yet it is used as a surrogate appraisal of national well-being in far too many circumstances.
The shortcomings of GDP are well known, and several researchers have proposed alternatives that address them, including William Nordhaus' and James Tobin's Measure of Economic Welfare, developed in 1972; Herman Daly's and John Cobb's Index of Sustainable Economic Welfare, developed in 1989; and the Redefining Progress think tank's more recent variation, the Genuine Progress Indicator. Although these alternatives -- which, like GDP, are measured in monetary terms -- are not perfect and need more research and refinement, they are much better approximations to a measure of true national well-being.
The formula for calculating GPI, for instance, starts with personal consumption expenditures, a major component of GDP, but makes several crucial adjustments. First, it accounts for income distribution. It then adds positive contributions that GDP ignores, such as the value of household and volunteer work. Finally, it subtracts things that are well-being-reducing, such as the loss of leisure time and the costs of crime, commuting and pollution.
While the U.S. GDP has steadily increased since 1950 (with the occasional recession), GPI peaked about 1975 and has been relatively flat or declining ever since. That's consistent with life-satisfaction surveys, which also show flat or dropping scores over the last several decades.
This is a very different picture of the economy from the one we normally read about, and it requires different policy responses. We are now in a period of what Daly -- a former World Bank economist now at the University of Maryland -- has called "uneconomic growth," in which further growth in economic activity (that is, GDP) is actually reducing national well-being.
How can we get out of this 33-year downturn in quality of life? Several policies have been suggested that might be thought of as a national quality-of-life stimulus package.
To start, the U.S. needs to make national well-being -- not increased GDP -- its primary policy goal, funding efforts to better measure and report it. There's already been some movement in this direction around the world. Bhutan, for example, recently made "gross national happiness" its explicit policy goal. Canada is developing an Index of Well-being, and the Australian Treasury considers increasing "real well-being," rather than mere GDP, its primary goal.
Once Americans' well-being becomes the basis for measuring our success, other reforms should follow. We should tax bads (carbon emissions, depletion of natural resources) rather than goods (labor, savings, investment). We should recognize the negative effects of growing income disparities and take steps to address them.
International trade also will have to be reformed so that environmental protection, labor rights and democratic self-determination are not subjugated to the blind pursuit of increased GDP.
But the most important step may be the first one: Recognizing that the U.S. is mired in a 33-year-old quality-of-life recession and that our continued national focus on growing GDP is blinding us to the way out.
Robert Costanza is the director of the Gund Institute for Ecological Economics at the University of Vermont.
Copyright 2008 Los Angeles Times
71 Comments so far
Show AllQuick update: The great Robert F. Kennedy video on the GDP can now be seen at:
http://www.youtube.com/watch?v=77IdKFqXbUY
Thanks!
Economist that is. An economist who doesn't understand that theirs is a social science.
"Economists act like they are doing some type of pure science, but it is actually one of the most value ridden of the "sciences". "
Name one please?
The GPI is a great concept! Economists act like they are doing some type of pure science, but it is actually one of the most value ridden of the "sciences". It starts with what you choose to measure.
The Glaser Progress Foundation has been working hard to make people aware of the deficiencies of the GDP. Check out their new video about Robert F. Kennedy's challenge to the GDP.
http://www.youtube.com/watch?v=e51JnJPPY0E
We have so many superfund sites which haven't been taken care of because the money is not made available or the polluters not held accountable.
It seems there is one person navigating a toxic river and the hazardous waste is taking it's toll.
Hopefully, it's not a plastic boat and this person's watercraft will eventually sink as the corrosive waste eats away at the bottom of the boat. And maybe, just maybe, there'll be some one there to get this person out of those waters to recieve the proper care and rest.
"Now, jake, do you agree or disagree with RFK?"
I vehemently disagree. RFK demonstrates a profound ignorance of economics, as an example, by suggesting that air pollution or redwood destruction is counted as part of GDP. And while he is correct in showing things that it does not count, in no way does that mean that GDP is meaningless. Any freshman economics student knows that GDP doesn't measure "everything".
In answer to your question, jakenewton, as to meaningfulness (or meaninglessness) of the GDP, I offer a quote from Robert Kennedy:
"Our gross national product is now over 800 billion dollars. But that GNP, if we judge the country by that, counts air pollution, cigarette advertising, and ambulances to clear our highways of carnage. It counts special locks for our doors and the jails for the people who break them. It counts the destruction of the redwoods and the loss of our natural wonders. It counts napalm, nuclear weapons, and armored cars for police to fight riots in cities. It counts rifles and knives and television programs which glorify violence in order to sell toys to children."
"Yet, the GNP does not allow for the health of our children, the quality of their education, or the joy of their play. It does not count 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 neither wit nor courage, neither wisdom or learning, neither compassion or devotion to country. It measures everything except that which makes life worthwhile."
Now, jake, do you agree or disagree with RFK?
Ah, yes, riverman, then you are not really talking about the intellect at all, but the 'intelligence' of perception and intuition. Some might call this 'spiritual intelligence.' If this is what you making reference to, then your posts are somewhat puzzling. This 'logic' as you call it is not the sole domain of men, but includes women as well; in fact, in some ways they are closer to it.
In your posts, I also sense a kind of anger and frustration with the current state of affairs. This too I understand all too well, living in a 'red' state. Let's just face it: authentic sanity is a very rare commodity in the this world; the vast majority of us are insanely egoic. Now, that's not to say that it is hopeless, just that mankind is at a very dangerous crossroad.
J. Krishnamurti said it many years ago: "what's needed to 'save' the world from self-destruction is an inward, spiritual revolution." For me this is the elephant in the room that most do not want or refuse to see, thinking that 'they' are just fine, while it's everyone else who is 'screwed up.' That's ego rearing its ugly head again. Probably shouldn't post the here, but what the heck.
I remeber just before Reagan got into office, for some reason too many union people and lower white collar workers started complaining bitterly about government regulations. They voted for Reagan and they sold out their children and grandchildren's future. Corporation are like T rex, huge predators that care only about how much they can take.
When we removed the regulations on them, they started to consume the middle class. Slowly but surely but at an increasing rate. Their inflation figures are a lie, sure we can buy electronics cheap, but housing, food, and energy are going beyond our ability to pay. Every job the corporations can they send over seas. Instead of service and our problems taken care of, we get aggravation and the inability to rectify problems caused by the corporation.
It is long past time that we corral the corporations and make them understand that if they are going to have the protections and benefits that The US offers, they are going to have to follow rules that benefit the population as a whole. Just like the rest of us.
"We have decades, now, of empirical evidence on our economy that proves decisively that these free market theories have been a disaster for all but the wealthy."
What would be your very best examples? If you could please be very specific, and cite your sources.
"...rather than GDP, which is essentially meaningless (except if you're a Republican politician.)"
What's the very best argument you would make to support this statement?
riverman, while sane, rational, scientific reasoning ability can be of great value, it is not what is most essential. There are many scientists who are outstanding in that regard, but unethical with respect to its application. For example, those who work in weapon design.
To think clearly, we must be free of 'artificial' or unnecessary desire. Only awareness can help in this regard. Clinical thought will not of itself make us less competitive, greedy, or loving. Neither will it lead to cooperation with regards to benefit of the 'greater good.' Besides, if we pride ourselves on our intellectual ability, there's a certain vanity and condescension that usually goes along with it (i.e., they are stupid but I am smart...). And a soundly reasoning intellect does not necessarily lead to compassion or wisdom.
solutions2
Thanks for your post. It made my day much better.
If Americans can be happy with consuming too much is true, it is still true that the real necessities of a decent life (higher education for their children comes to mind)are coming to be out of the reach of many citizens. It also does not follow that if the majority of the population should be happy with less, that the wealthy and super-wealthy should continue to walk away with their tax breaks.
The UN uses the Human Development Index to evaluate/compare countries (http://en.wikipedia.org/wiki/Human_Development_Index) It incorporates GDP, but does not make that the sole criterion.
The US presently ranks 12th in HDI measures, behind Canada, Australia, Ireland and some Scandinavian countries. It would make much more sense to evaluate our "progress" by this measure rather than GDP, which is essentially meaningless (except if you're a Republican politician.)
A better, more meaningful measure of economic "success" would be median household income (which, interestingly, Republican politicians NEVER mention.) Personally, I would be in favor of a consitutional ammendment that tied Congressional salaries to median household income.
"The problems are like horrible unsolved conjectures in complex analysis, and we're like retarded grade-school children trying to solve them by counting on our fingers."
--That's not the problem. The problem is that we've forgotten how to live simply, and especially how to uncomplicate our lives. We gladly and willingly seek complications to relieve us from the boredom of our day to day routines, and above all to escape facing ourselves as we actually are.
We have all manner of escapes including entertainment: sports, religious, ad infinitum. Oh yes, and let's not forget our love for drama. It's not just us, though, but the whole of mankind that is caught in this miserable grind. Rather than let intuition lead clinical and logical analysis, we've put the thought process on the pedestal of being, and actually take pride in our ability to destroy ourselves!
That truly is 'retarded' because it is unnecessary. We need to get back in touch with our intuitive natures, and the only way to do this is to be watchful and aware in the present moment, where intuition resides. Further, we MUST begin to do this if we are to survive as a race. Children are not taught how to live holistically; in fact, the present educational system promotes division within egoic fragmentation. To see this is the beginning of freedom from it. And inward freedom is the only real freedom.
RUTH K: I apologize if I over use the same metaphor but it's so damned apt! Mars in astrology relates to self-interest. In extreme it champions war and violence. In mysticism, Mars is likened to the first chakra and our urge to mate (for continuation of species) as well as our survival actions. Mars is the me-first planet, and it's counterbalance, Venus, is the we-first planet. She is champion of peace, the arts, diplomacy over war, and all things that build culture.
Our nation, as a world leader, has cleaved to Mars as is seen in its bloated military budget while quite literally, children are left to starve. Inasmuch as life is a shared fabric, a weave that makes each of us a sacred strand, this leaving so many weak persons (poor, aged, diseased) to fend for themselves is proof of a Mars-run society. Darwinian "survival of the fittest" notions suit this model quite well, as does the Calvinistic premise that if you are doing well, you demonstrate God's blessing, and if not, screw you (i.e. you deserve your pain, oh, sinner!). Thus a policy that clearly disengages from the slightest sign of compassion (the US prison industrial complex, the treatment of "illegal aliens" are other examples) is one that decimates all things sacred unto VEnus.
When we look back over time, it's clear that those investments in Venus, i.e. famous paintings, cathedral ceilings, fine art and music exceed in value anything left to the savagery of war. The would-be harvest planes of nations now littered in land mines or depleted uranium are another example of this banquet of wastes left as homage to the god of destruction. Nuclear weapons stockpiled when food lots are being used to burn fuel is yet another disgusting example of this sacrilege based on worship of a principle linked to 'god' by the Romans who adapted Christianity to suit their own purposes. Evolution of the spirit has been derailed by these beliefs, and they have shaped Western civilization for 2 millennia. So deeply entrenched are these behaviors that social scientists take them for human nature, while philosophers lament that greed/avarice/aggresion are the natural aspects of the human estate. Bah humbug! Margaret Mead showed other models. Many indigenous tribes created more socially balanced models. The collapse of Western civilization based on the trifecta (for US anyway) of massive debt, lack of investment in education/infrastructure, and impact of global warming will indeed intensely alter the big paradigm.
Times have changed, but some arguments remain the same.
In March of 1968, Robert Kennedy challenged the dearly held concept that pure economic activity (usually measured by the GNP) is an honest way to measure the impact of corporations on the human community. In 1968, he said:
"Our gross national product is now over 800 billion dollars. But that GNP, if we judge the country by that, counts air pollution, cigarette advertising, and ambulances to clear our highways of carnage. It counts special locks for our doors and the jails for the people who break them. It counts the destruction of the redwoods and the loss of our natural wonders. It counts napalm, nuclear weapons, and armored cars for police to fight riots in cities. It counts rifles and knives and television programs which glorify violence in order to sell toys to children."
"Yet, the GNP does not allow for the health of our children, the quality of their education, or the joy of their play. It does not count 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 neither wit nor courage, neither wisdom or learning, neither compassion or devotion to country. It measures everything except that which makes life worthwhile."
Forty years later and we can say the same thing.
Jacob Freeze,
On the other side of the ledger, so to speak, you have a band of distinguished Nobel Laureates in Economics. Many hail from University of Chicago, some from MIT, Princeton. Milton Friedman among them.
They provided the sham theoretical framework for the concept of trickle-down economics.
Now, you might claim correctly that no one here understands the economic theory well enough to be able to discuss the merits of the theories intelligently. But, empirical data is a real bitch. We have decades, now, of empirical evidence on our economy that proves decisively that these free market theories have been a disaster for all but the wealthy.
It's wide open for speculation if that was the intent all along. Knowing what academic types are like, it seems doubtful they would choose to serve as pawns in a class war rather than as researchers and social scientists.
But what is not open to speculation is the results. Real median income is down during this time period, despite spectacular gains in productivity and GDP growth with inflation in check.
The problems are like horrible unsolved conjectures in complex analysis, and we're like retarded grade-school children trying to solve them by counting on our fingers.
Mr. Costanza's suggestions are consistent with this picture. "Tax bads instead of goods."
It sounds like something a third-grader would spell out with a crayon.
Gorgeous article. I loved every word, but I'm pretty sure not so many people have been fooled by the money loving media serving up GDP booming news for the money lovingest. The recession of living conditions actually predates the 70's by a long shot as the value of the dollar has fallen precipitously and steadily since the gold standard was removed.
I think the real solution though is Direct Democracy then a vote to eliminate cash as a means of transaction to be replaced by calorie economics; each products worth equaling exactly the calories of human toil spent in producing and delivering the product; Plus all material divided evenly. While we allow people vast control, who might not work, might not contribute any value, might detract value, but allow them control because they have some moolah, we will be in trouble indeed.
riverman;for those old enough to remember-you are CD's professor Irwin Corey.Gibberish!
joneden wrote: "I think what we have here is a massive failure of people taking personal responsibility.".....I am disappointed that no one challenged this. What I really conclude is that--unless Americans are inherently less able to take personal responsibility than others--what we have here is a massive failure of public policy.
This is all good, but does not even look at the fundamental problem of WHY life has been getting worse for 30 years. The observation is real enough - the explanation is here - Banketeering - how the banks have been stealing trillions from you, and the tap is still running http://www.rudemacedon.ca/dlp/box/box01-money.html
merwan said: "Our quality of life spirals downward as our population spirals upward. This correlation is not coincidental."
But even that is related to how our society has been sold in the last 30 years. Reagan passed a law 30 years ago making the hiring of illegals illegal, but refused to enforce it. There's no question that the promoters of 'no-holds-barred' capitalism were against it: they believe they should be able to hire who they want, wherever they want. To some degree I agree with them, but believe caution is warranted, given the overpopulation of this world, and the potential for Americans to pay unfairly for it. And that's what's happened. Free-trade is hurtful for Americans if practiced with abandon. Ironically, those with a skeptics eye toward 'free-trade-anything', are better placed to protect American's from the economic dangers of global overpopulation than the 'free-trade' crowd, for whom Americans are just another group to be exploited on the way to fame and fortune.
I learned long ago that the majority of my income was spent on buying/maintaining/gassing a vehicle so that I could drive to work so I could afford to buy/maintain/gas a vehicle to drive to work.
I have it from some pretty good sources that UFO's are still on the table, but they want to try some of their other more traditional options to globalize us first. Once they do that, they may bring out the UFO's and call them space terrorists and create another War on Terror. This would be a way to justify martial law and reduce population in those areas needing it. In fact, we might nuke China and Russia, and any other opponents to the globalist agenda, and blame it on UFO's.
Bush is working on two new perpetual wars:
(1) Terrorism -- a war against a concept, without exit condition.
(2) China -- the country to which our CEO's have outsourced a good number of our jobs, manufactures most of the products in the Big Box stores, to which we've sold a lot of our debt (and they depend heavily on us as consumers).
Neither make any sense whatsoever. It tells you how far they're reaching. They'd have been better off to fake some hostile UFO landings and manufacture an interstellar enemy.
Reagan learned his lessons well while guv of California. He had the personal attention of the Orange County Repugs. They did not want to repeat the Nixon mistake.
He was really NOT supposed to end the cold war and do business with China - those items effectively ended the eternal war economy that keeps the rich, rich. Why else do you think he was impeached.
The cold war was effectively restarted under Ford by his white House staff including Cheney and Runsfeld.
Reagan was the best ever. He was such a good actor, he never flubbed his lines and delivered them smoothly (unlike Bush).
My father, a lifelong Republican and FBI agent, changed allegiance when he saw the corruption in favor of the rich installed to ruin the country.
Yo, Riverman, if there's an intelligence test to get to vote, I'm not sure you're going to make it. Want some help with the spelling and grammar? Or is literacy and logic unrelated to intelligence?
BOBBY DYKEMA: I agree with your astute comments on the power of TV to mesmerize audiences into a very unrealistic vision of "The American dream." I, too, turned mine off.
One factor no one has mentioned is global warming and the wild weather changes that are going to turn security into a passe concept. I remember in my youth when every once in a while, LIFE magazine would run a story about a devastating environmental disaster. In that time period these were few and far between. Now they are becoming the norm. In Florida, the past few weeks have seen temperature variables from the upper twenties to lower eighties, and no plants can sustain that roller coaster for long. WE may soon see interrupted harvest cycles. Life as we know it, this whole pursuit of happiness as some kind of material ends in itself is not going to be a viable path. Simplicity and a return to the realization of the sacredness of having and hopefully sharing one's daily bread... that's where things are headed for the lucky.
You are a sick person, Riverman. Get some help. Seriously.
I feel you magicmary - my adult life has been one set of plans thwarted by events beyond my control too - dotcom bust, 9-11, recession, high housing costs, housing bust, etc. I worked in the corporate world and saw the greed involved in that lifestyle. I hope we can move forward as a society to the point where we value each other for who we are and not what we own or how much money we have. There is a split between conservatives and progressives but many conservative friends also lament this greedy, materialistic development in our society. Maybe if we can see past our differences on some issues, conservatives and progressives can achieve the goal of a more just society.
o 40 countries have better rates of infant mortality than the US—countries like Cuba, and Slovenia. A child born in Japan is 3 times as likely as one born in the US to reach the age of one year. (See CIA World Fact Book.)
o Our 15 year olds were recently ranked #23 and 31 respectively in science and math. (See Programme for International Student Assessment of the OECD 2006.)
o
As for Child Well Being, we rank #18 of the 21 rich countries. (See Report Card on Child Well-being in Rich Countries 2007)
o
We are about tied with Mexico for being the fattest of the OECD countries--the NIH now forecasting a declining life expectancy. (See OECD statistics.)
o As for Income Equality, we are #29 of the OECD countries—only Mexico scored worse. (See OECD statistics.)
o We now have a negative savings rate—citizens of Italy, France, and Germany are saving at about 11%. (See OECD stats.)
o We are now imprisoning 1% of all adults i.e. 1.6 million. Even China with 4 times our population imprisons less people. (See Pew research and Feb.29, '08 International Herald Tribune article.)
o Finally, our life expectancy at 78 is only 45th best in the world and this after spending twice as much per capita on health care as the average OECD country. (See OECD stats.)
I think what we have here is a massive failure of people taking personal responsibility.
Check out "Consumed: How Markets Corrupt Children, Infantilize Adults, and Swallow Citizens Whole" by Benjamin Barber. This is an amazing book!!! (BTW Barber also wrote "Jihad vs. McWorld.")
The article mentions that its data are consistent with "life-satisfaction surveys, which also show flat or dropping scores over the last several decades."
There may very well be a correlation between these statistics and the others mentioned; but it may not be the obvious one. One of the things that has changed in America over the past several decades is that television went from being a novelty to a necessity in every home. During that time also, Madison Avenue executives perfected their techniques of making viewers less satisfied with their lives in order to sell them more products. It's not just the commercials, it's the shows that are also designed to pitch a "lifestyle" to brain-dead discontented viewers--one that requires the latest cars, fashions, foods, hairsprays and deodorants. And drugs! What insignificant malady of middle-class living anymore exists that cannot be solved by an expensive prescription drug?
It seems to me that subjective "life-satisfaction surveys" may be closely related to this phenomenon, and that one of the more positive moves an individual or family can make toward her, his or their own well-being is to shut the damn thing off and get a life.
It worked for me - eight years ago when I started graduate school - and I haven't looked back.
It appears that the GPI peaked at the same time as per capita energy consumption. According to Olduvai theory, that marks the peak of a civilization.
So it's all downhill from here, folks. Tax and policy changes aren't going to fix this -- unless they put more oil in the ground.
Get used to the fact that your children and grandchildren (if you have any -- kudos if you don't) are not going to have it as nice as you have had it.
Once you've accepted that fact, then perhaps you can voluntarily cut way back, in the hope that other greedy people won't suck up what you forego, but rather save it for future generations.
Move closer to work! Move to a much smaller house! Ride a bike or walk! Plant a garden! De-consume! Starve the beast!
Emergency U.S. rate cut in the air again...
Will hyper inflation make Americans happier?
Are we 'safer' now from War, Pestilence, Famine and Death? How will stealing grandma's life savings 'save' jobs, the ecconomy or the Neo-Cons?
What will be the Bush Crime Family Legacy as measured in Gross Domestic Happiness?
What shall we do with all those 'stimulus' rebates that the GOP is printing up? Invest in Euros or just short the dollar (FXE, UDN)?
When we decend into cannibalism, as it has been shown all collapsing cultures eventually do....it's the fat rich ones we'll be looking for first. Do a bit of looting, big feast after.
Riane Eisler talks about this in her book, Real Wealth of Nations, creating a CARING economics. The book is a history of how we got into this mess--and what we can do--along with things like no longer measure GDP and replacing it with something like GPI--to get out of this.
All of this is doable if we work together to shift from a consumer (carbon) economy into a caring economy. We decide what to value--and the old story no longer works. Let's create the new story.
www.realwealtheconomy.com
Until Greedism is recognized - and treated - as the severe mental disorder it is, nothing can change, because Greedism negates empathy, and, hence, sufferers lack the ability to even comprehend the definition of "the well-being of others."
I got mine - screw you, versus everybody got enough to eat? Can't have both...
"By some measures of economic performance, the United States has been in a recession since 1975 — a recession in quality of life, or well-being."
AKA - My entire adult life.
I have a long list of directions thwarted because of politics and the economy, budget cuts, Nafta, etc. Now at 52 I fear for my ability to retire and pay off a mortgage.
Our quality of life spirals downward as our population spirals upward. This correlation is not coincidental.
A good place to start in understanding the nexus of economics and ecology is Herman Daly's book, "Beyond Growth: The Economics of Sustainable Development." It's geared toward the non-economist, and places human economic activity (extraction, production, consumption, waste) into its proper context.
Well, it's not been ALL bad since 1975. The advances in personal computers and electronic miniaturization have been astonishing. Some of it is annoying; I don't think people need to shut out the world in public with their cell phones and iPods. However, I love that I'm able to check the news from multiple sources and get access to library catalogs all over the world at a pretty cheap rate. Giant LCD TVs are pretty neat, though we're better off not watching television at all. I read a Robert Putnam article that posited a measurable loss of civic participation and after sorting out other factors put the blame squarely on television. Those who grew up watching TV participate a lot less than those growing up in the pre-TV era, even after accounting for education, wealth, gender, race and other variable.s
GDP certainly gives a false reading of the well-being of our society. But we all know the reality of the situation. The more we listen to economists, political candidates and the MSM to evaluate our lives and draw our attention away from our communities, our neighbors and our families the less we are able to control our own economy and make our own choices.
Expecting change from the top is expecting manna from heaven. You can vote for whoever you please, the hardwire still drives the same machine.
The only real answer is to take control of your own situation; work in your community among your neighbors to carve out a self-sufficient niche beyond the control and reliance on your government. Set up local foods systems, take charge of education, housing, energy needs, and work on bringing the means of production for life's essentials under the control of worker owned cooperatives within your community. Only when the government is made irrelevent can it be changed.
This is not some utopian dream but an attainable vision for a better world. It does require work, dedication and considerable fence mending between all members of your communities. It is time well spent for a cause of absolute importance. It is up to you now to deliver a future to the next generation that you can be proud of. It may require some sacrifice but the sacrifice is far better than to have to explain to history that you just didn't have the time or ambition to get it done.
Time's Up - get to know your neighbors and make a difference. Break a stupid government law just to you get yourself on the right track - once you've become a revolutionary you'll never want to go back!
Big_Money, I've looked at that link before, and it looks like you have to subscribe to get any real information. Do you have the inside word on that? Thanks.
re: jakenewton 12:59 pm
An excellent source of information about the manipulation of CPI and GDP, and the disappearance of M3, can be found here:
http://www.shadowstats.com/
Real government numbers, with the cold hard facts about the prisms they get shone through.
Thanks for the link middlec. I checked the article and saw no reference to 600 billion of anything being wiped out. They do estimate 200 to 300 in defaults, but that wouldn't represent a loss of that much.
Do you play piano or something?
"America the criminal enterprise calculates the CPI omitting the cost of energy and food."
That's not CPI, It's Core CPI. They calculate both with and without and report both regularly.
"Yes Dorothy, they believe their own lies."
They detail the methodology on the BLS website. Did you miss that? Is that lying?
America the criminal enterprise calculates the CPI omitting the cost of energy and food. Yes Dorothy, they believe their own lies.
Criminal business, government, and media are having a wonderful time and live in economic bliss. They are always reminding us just how well off we are. Well take this you &$)(%@%$$+*ers, you don't know shyt and you don't care either. Go to blazes and do it now! I don't want to hear your gazillion dollar investment commercials, your quadrillion dollar cars and drug ads. I don't buy your propaganda or your hideous smiles. You are the creatures of death and destruction and your economist whores spin your bedtime tales of false well being. Collapse you human crustations of the 20th Century and lie in the dust until you become nothing more than a dark layer of historic silt. Damn you all for the purposful hardships you have imposed upon the people. Happiness index indeed......
http://en.wikipedia.org/wiki/Subprime_mortgage_crisis
"600 billions (and counting) wiped out during the mortgage fallout."
WHat exactly is the 600 billion figure for please? Thanks in advance.
klasseng - That was a very honest post and you make a point everybody seems to forget. Most progressives would vote for measures that helped poor people at the expense of the rich. Yet when it comes to countries, we seem to be all up in arms that USA is suffering economically so that poorer countries can raise their living standards. Seems like a double-standard to me.
Now of course there's tons of waste and graft in the way Globalization is currently implemented. But does that mean it's wrong per se? Aren't we all each others brothers and sisters?
Simple American economics 101:
(1)we are in the down slope of Peak Oil discovery.
(2)An increased demand in China and India cannot keep pace with production of established oil fields.
(3)oil prices will rise at a much faster pace now.
(4)we are entering a period know as stagflation which means inflation during a stagnate (recessionary) economy.
(5)America has a negative savings rate. The last time this happened was during the Great Depression.
(6)A 150 Bn bailout to Americans will not replace the estimated 600 billions (and counting) wiped out during the mortgage fallout.
(7)As the dollar collapses, crude oil prices rise.
(8)The dollar is worth 65 cents on the dollar compared to the Euro.
(9)Unfortunately, it appears that the self fullfilling prophecy is playing out before our eyes.
Reaganomics destroyed the Unites States.
I remember well growing up in the 1970's. My dad worked as an auto body mechanic and supported a family of four by himself. And we eventually bought a 2nd car in 1976. We even took vacations every summer out to the Poconos in Penn. We went to Catholic school. How did they do it?!
I noticed during the 80's and onwards a marked decline in the quality of life and the quality of most products. I guess I wasn't crazy after all, as this report proves!
Quality of life in the US has been smashed to bits and replaced with a hedonistic and materialist culture. I don't blame Repugs or Democrats but the entire US GOVERNMENT of liars and thieves!!
Ronald Reagan relly got the downward spiral going. He was such a fool he didn't even know he was under the control of the super rich.
Globalization has been an increasing trend over the last couple of decades. Multi-national companies like it and there's no doubt that it has increased international trade. Trade barriers are lowered and goods flow. I'm not saying that's good, there are many instances of abuse of the system by profit seeking companies.
Generally globalization (when not abused) can result in a levelling of standards of living between rich countries and poor ones. Poor ones develop goods at a lower cost than rich ones do. Money flows from rich ones to poor ones.
I'm not surprised that the standard of living in more wealthy countries is decreasing . . . maybe it should!
"Ever since then, the gov. has cooked the books to create lower inflation numbers, resulting in an ongoing understating of inflation."
Could you be more specific please?
"When the cost of buying a house is high and renting one is low, they apply the cost to rent."
This too please, thanks in advance.
I was born in 1959 -the 6th of what was to become 9 children. It's pretty obvious that my parents were Catholic.
But that little comment aside, my father was an architect and land use planner. He made good money and we were well in the upper middle class of those times.
The story of my family changed rapidly when my father died and all of us got a job of some sort to help with school costs and food, etc..
Today those jobs I did as a high school student are now being done by educated adults or immigrants. The point is, that even being no economist, it didn't take much thought to realize that since Reagan, things such as the quality of life have gone downhill, with the middle class disappearing quietly but relentlessly. The truly wealthy have gotten wealthier as the rest of us were stuck in economic time as safety nets began to disappear while trying to make a decent living appeared more and more difficult.
I have no children, but before leaving the USA when Bush was given back his crown in '94, I know that what a two parent home with two children and all the related costs needed to raise a family and enjoy a few comforts in the San Francisco Bay area, was much different than what the government considered you had to be earning to be living at the poverty level.
Just living in an apartment sharing rent I needed to earn more than $25,000 a year to live comfortably and be able to buy books or go to the cinema or go backpacking as often as I did. I can't imagine how a family of two parents and two children would make ends meet today on what I earned a little over three years ago.
Nine children in today's world is an irresponsible thing in my opinion but all that aside, my father was able to provide for all of us alone. In a normal family today, that would be impossible - unless you're one of the wealthy.
Not only do we need to come up with a more accurate way to measure the well being of a nation, we need to bring back the "quaint" idea that it is the responsibility of a government to ensure the education and health of every citizen. I'm not talking about hand outs or creating new ways in which the lazy can live comfortably off the sweat of the hard working people, I'm simply saying that we all encounter difficult times of one sort or another and need help at times. Far too many people are living one small catastrophy from being homeless - if only temporarily. And that help is harder and harder to find or get these days.
It's late here in South East Asia and this post has been written poorly, but I think I've gotten my point of view across. And thank goodness that I can live comfortably on less than $6 dollars a day. And a sonograph I needed done a few weeks ago cost less than $3 dollars. I feel very fortunate.
First, I would say that i would agree that finding additional ways to measure the economy is desireable. I have a couple issues here though.
"An oil spill, for example, increases GDP because someone has to clean it up, "
This ignores the Opportunity Cost of things like oil spill cleanups or replacement of broken windows. That cost is likely to keep GDP down indirectly. See here about the "Broken Window Fallacy":
http://en.wikipedia.org/wiki/Parable_of_the_broken_window
"GPI peaked about 1975 and has been relatively flat or declining ever since."
I was able to find a PDF about this that is informative, from the Redifining Progress website. Search for it, it's titled "The Genuine Progress Indicator 2006 A Tool for Sustainable Development". It helps to explain the methodology, which the authors admit has been criticized as arbitrary. It also shows a chart supporting the above quote from the article. I think we need to be cautious about simply accepting the numbers as reported.
Let me see if I got this right: The author is suggesting that a greed-based capitalist society that has successfully trained its citizens to value greed and material acquisition should change what it values to "well being"?
Even more applicable to the fate of the working class than the GDP is how the government calculates the consumer price index (CPI).
During the 1970s the calculation was relatively straight and the CPI came close to identifying the true rate of inflation. The business community, however, did not like giving workers COLAs commensurate with inflation, and politicians did not like getting blamed for high inflation. Gerald Ford (in 1976), and Jimmy Carter (in 1980) lost election bids, due in part to their being blamed for high inflation.
Ever since then, the gov. has cooked the books to create lower inflation numbers, resulting in an ongoing understating of inflation.
Understating inflation works against the working class in several ways, including but not limited to the following:
1) Results in lower annual COLAs for workers.
2) Results in lower annual COLAs for social security recipients and pensioners
3) Lowers the interest rate that banks pay the Federal Reserve for money they borrow, resulting in 4 through 7.
4) Inflated the value of stocks
5) Inflates the value of real estate
6) Inflates the cost of food and energy
7) Devalues the US dollar.
The gov. also routinely changes the criteria it uses to calculate CPI. For example: When the cost of buying a house is high and renting one is low, they apply the cost to rent.
There are also multiple concurrent CPIs. Two years ago my CPI-based COLA was 3.2%, while Social Security recipients' CPI-based COLA was 4.1%.
Perhaps our quality of life is going downhill because many in my generation (and I am 36) were brought up with the religion of consumerism that my parents (boomers) embraced wholeheartedly. My grandparents (WW2 era)lament that no one volunteers anymore because everyone is so busy with work and kids' activities.
More isn't always better, sometimes it's just more.
Another good example of defining and controlling the language.
I am going to read up on some of these new (to me) indexes and try to apply/redefine them for local groups.
We could bolster the 'care economy' by giving a stay at home primary care giver (male or female) during our children's formative years, a significant tax break.
Local economies could encourage fair labour goods exchange barter systems to increase GPI without factoring into GDP.
Perhaps Hollywood could do it's part to make Bohemianism popular again as we get off the corporate plunder consumerist treadmill.
Carnival
Here's to life as an on going carnival…
Of simple joys.
Here's to a pink cheeked glide skiing forward.
Here's to a stretched out carousel of forever moments.
Shii, shii, shii,…..
Here's to gliding in that perfect moment, as the creaking aspens whisper It is nice here….. shi, shi, shi,
Here's to a fleeting childhood memory
Of a ride on a smoothly rising and falling wooden horse reaching for that ring. A ring to nail that clown's mouth with,. and ride on gratis…..shi, shi, shi,…..
Here's to gliding in that perfect moment, as the creaking aspens whisper It is nice here….. shi, shi, shi,…
Here's a toast to life as a shared carnival of special moments of toasting all the joys that shared celebrations can bring.
Here's to gliding in that perfect moment, as the creaking aspens whisper It is nice here….. shi, shi, shi,…
For life ought to be a carnival of shared joys.
So grab that special ring
And hit the mark of that open mouth corporate clown of greed.
Life ought to be a carnival
Shi, shi, shi,…..
Here's to life as an on going carnival…
Of simple joys. A pink cheeked glide, sliding forward, a braced pumping of a stretched out carousel of forever moments.
Can we learn to have happy, productive lives on that level of income and even less? What skills are needed to live a happy life with what we have?
--of course, we can. But first we much learn to distinguish between needs and wants, and not equate our self-worth with the number of things we possess and/or the size of our bank account. Fat chance of that happening, eh?
Americans have been lulled into believing that shopping for junk they don't need is quality of life...being in debt, working until you are too tired to think to get this junk, is upward mobility. And of course, once Americans are so in debt they have few options but to be docile.
Yes lets set our goal as increased well being as opposed to increased consumption. The US is clearly the leader of consumption in the world. I think we need to somehow reduce our national drive to indiscriminately consume
and begin to actually reduce our consumption. The median household income in the US is around $48,000. Can we learn to have happy, productive lives on that level of income and even less? What skills are needed to live a happy life with what we have?
Big money and greed have pretty well taken the country over. It will not be easy to reverse what has happened over the last several decades as most people do not voluntarily give up their monetary gains for the benefit of others. We can only hope that many will see that we will not have a decent country to live in unless the present conditions are turned around.
Businesses know that they get more of anything they measure. If we can just get the GPI measured, and that measurement published, I think we can start making progress.