Official economic growth is normally measured in crude gross domestic product (GDP) terms.
GDP is broadly defined as the monetary value of all finished goods and services produced in a specific period. So the bigger the GDP, the better a nation is meant to be doing.
But this same definition regards, say, the wreck of the container ship Rena and the devastating Christchurch earthquakes as "good" for the economy because they have stimulated work for tradespeople, demand for rebuild materials, and so forth.
Sounds crazy, but it's a system that fails to factor in any associated negatives. It's a bit like saying that it's a go-ahead economic thing to have vandals going around smashing windows because it generates work for local glaziers.
Put simply, the more a nation trashes its natural resources to produce goods and services, and the more we uber-consume and get into debt to offshore banks, the better it is for GDP and purported "growth".
But what price the new SUV when mighty rivers like the Manawatu and the huge Wairoa up north have been reduced to near-fishless open sewers. Put another way, if GDP was a game of Monopoly, the first player to be bankrupted would win!
Many economists acknowledge the shortcomings of GDP criteria but, when pressed, will often respond with an "it may not be perfect, but it's the best we've got". Well ... actually, it isn't.
Recent innovatory moves are attempting to institute economic standards that recognise what is broadly defined as "quality of life". Even the New Zealand Treasury reported, in 2000, that "living standards or well-being can be far removed from the economic aggregates normally used to measure economic success, such as GDP".
Several alternatives have emerged, but perhaps the leading contender is the Genuine Progress Indicator (GPI).
The Anew New Zealand Progress Indicator Action Group has also played a strong advocacy role here. In its 2006 paper, Measuring Real Wealth in New Zealand, it cites the GPI index constructed by the Nova Scotia GPI. This is made up of 22 social, economic and environmental components under five main categories: Time Use (work, leisure etc); Natural Capital (soils, air etc); Environmental Quality; Socio-economics (income distribution etc); and Social Capital (health, negatives of crime etc).
Several local body councils here are, to their credit, attempting to bring these criteria on board for their strategic planning.
The term "economy" derives from the Greek "oikonomos", meaning management of a household. As Marilyn Waring points out in her seminal work Counting For Nothing, it's not oikonomos best practice to burn the furniture for firewood and then declare you're enjoying a higher standard of living because you're temporarily warmer.
The community - or nation - is the household writ large. Is it economically sound management if we are burning the metaphorical furniture for piddling short-term gains; if initiatives do not lead to a more balanced, stress-free lifestyle with good access to housing, community amenities and relative freedom from crime, pollution, debt, domestic violence and all the other negatives?
True growth is all about advancing genuine quality of life.
The shallow and flawed criteria of GDP economics certainly don't cut the mustard.
Coincidentally, Wairua, the name of the river boat doggedly rescued and restored by Dave McDermid and friends as shown in the This Town programme, roughly translates as the spirit associated with a person or thing.
Perhaps some of the lever-pullers should take time out up river to develop a bit more true perspective ... and wairua.
