Categories
Wellbeing Economies: Concept

Online-Event: Maja Göpel and Lorenzo Fioramonti

On Monday, the 30th of November 2020 at 7 pm (CET), German Professor and ‘transformational thinker’ Maja Göpel will meet with Lorenzo Fioramonti (one of the two main protagonists of our film) in a live debate, streamed online. The title for the evening:

WELLBEING
How can we recreate our societies and
thereby ensure wellbeing and quality of life?

The event is organised by Arts & Nature Social Club, in collaboration with the German Chapter of the Club of Rome.

Even though we are already deep in the editing process, we will attend and film the event — to capture what will surely be an inspiring and inspired discussion about how to make our societies future-proof.

For those who want to join, here is the YouTube live link for the evening. Musical support will be provided by Frida Gold.

Categories
Gross Domestic Product Introduction WEGo in Practice Wellbeing Economies: Concept

Replacing GDP with “Girls on Bikes”.

Since early 2018, we have spent a lot of time with our protagonist Katherine Trebeck. In the summer of last year, we also traveled to Costa Rica together, to film her while she was speaking at a conference about sustainable fashion, and while she met the Costa Rican First Lady.

On that trip, she told us about an idea that I forgot about later, and that I was again reminded of recently. It is a beautiful thought that very convincingly illustrates how much we must change our notion of what progress actually means.

You have a very tough challenge to overcome when you try to move away from an economy that is measured by the “growth” it produces, in terms of financially measurable output. Or, in other words, by how much it increases GDP every year. GDP is such an established measurement: Everyone has heard of it, it seems so incredibly familiar (even though most people have no idea what it really is), and that’s why people have a really hard time letting go of it.

Now, how does the growth of GDP tell us that a society is improving?

Well, it measures how much a society makes every year, in terms of how much money is being spent on things in that society. And then it assumes that we are doing better if more things are made and sold next year. And so on. Forever. More stuff is better. It’s as simple as that.

We are now finding out that more is not better. Up to a certain point, yes. But after that, more just hurts more: It hurts nature. It hurts equality in society. It hurts the psychological health in a population. It hurts the climate. Etc.

In the western world, and after we’d broken everything in World War II (“thanks” to the nation I come from, Germany), looking at the GDP was probably a good idea, for a while. We could simply count how much we are making and then assume that we’re doing better if we are producing more next year. It meant more people in jobs, more people could afford things, life was getting better. But those days are gone. We are no longer better off if the GDP keeps growing, we’re actually worse off, nowadays. And we’re clearly ruining the planet this way.

So we speak a lot about what might be a better measure. There’s not going to be a single thing that replaces GDP, of course. But if you ask Katherine which single measure she would pick if she could use only one, to analyse if a society is actually doing better year after year, she’ll say this:

Why not get countries to measure the number of girls who bicycle to school?

Ok, this may seem very strange at first glance. What? Rather than looking at how much economic output our country is producing, let’s count girls on bikes?

Think about it. It makes a heap of sense:

If more and more girls ride a bike to school, it means it’s safer and safer to cycle in traffic.

If more and more girls ride bikes to school, it means that bikes are increasinly accepted as a means of transport. And it means less parents’ cars — who are now doing the “parent taxi” thing (a big issue here in Germany) — are polluting the air and creating dangerous traffic jams outside schools.

If more and more girls cycle to school, it means that more and more girls are actually going to school and getting an education, period. That’s an important achievement in many countries.

If more girls are cycling to school, it means that they’ll get used to this mode of transport, it will translate to better health for them in the future, and to less pollution in society in the future.

If more girls go to school on bikes, it means that they are not afraid to be attacked by predators who do them harm.

If more and more girls ride bikes to school, more and more boys will do that, too.

If more and more girls cycle to school, it means that more of them are empowered and unafraid.

I think I agree with Katherine: This is an incredibly convincing measure of progress. And one that deserves serious consideration as a replacement for GDP. And I am not joking one bit.

Free photo by @luizmedeirosph.

Categories
WEGo in Practice Wellbeing Economies: Concept

A Breakthrough: The Scottish First Minister’s TED Talk – Let’s Move Beyond GDP

I can hardly contain my excitement: the Scottish First Minister Nicola Sturgeon gave a TED Talk, and only two hours ago it was published on the TED.com website. In her talk, she makes the case for governments focussing the efforts of their work no longer on GDP, but on increasing the well-being of their citizens:

In early 2018, we decided to tell the story behind the Scottish and other governments who were trying to join forces, to move beyond GDP, in the documentary film that this website is about, that we are currently editing, and that we are hoping to release early next year. Not knowing if this would happen, and not knowing how it would play out. The fact that the Wellbeing Economy Governments now exist, and that Nicola Sturgeon just delivered this courageous message brings us incredible joy. And reason for hope.

Categories
Behind the Scenes Gross Domestic Product OECD South Korea On the Road Wellbeing Economies: Concept

Film: Thoughts from the OECD Forum in South Korea.

In November our documentary film took us to Incheon in South Korea for the OECD World Forum on Statistics, Knowledge and Policy. Here’s a little video from the trip!

Categories
Behind the Scenes On the Road

Hope.

Sometimes, when you are making a documentary, what you learn most about is yourself.

This video was from our last trip to the UK, in the second week in November:

Categories
OECD South Korea

What We Learned In South Korea: the Wellbeing Agenda Is Making (Slow) Progress.

The last week was intense. We spent three days at the OECD World Forum on Statistics, Knowledge and Policy in South Korea. The title of the conference: “The Future of Well-Being” — and that makes it quite topical for our film, of course. And even more specifically: The “WEGo” initiative — which stands for Wellbeing Economy Governments — was publically launched there, and it is one of the key projects that our film is about.

Here are a couple of tweets that document the launch — Gary Gillespie, Chief Economist for the Scottish Government, posted this after the announcement:

And we ourselves summarised the launch as follows:

As we have explained in our initial video on this blog, we are making a film about people who want to help move our world towards a new and different thinking about the economy. That sounds a bit technical, but it concerns every person on this planet — and the rest of the living world, too. If we cannot manage to find another way to run our economies, we will crash and burn our world. And the governments that got together here and launched the WEGo project — Scotland, New Zealand, Iceland — are among the leading governments worldwide in this area.

What makes them different from the rest?

One part of the OECD (an organisation founded to coordinate the economic collaboration among some of the richest countries in the world) is all about numbers. If you want to run an economy, you need numbers. The key number that almost all governments are most interested in is GDP growth. (We talked about what that means in our video about the GDP.) But there are more: the unemployment rate. The exchange rate. The stock market index.

These are the “traditional” measures that economists have been using for decades now, in order to figure out if a country is doing well or not. These numbers helped us a lot to rebuild our world after World War 2, and to build the Western societies of the sixties and seventies — which were incredibly prosperous, and where the idea was developed that every generation will have a better life than the one before. Many decisions that were made in the last fifteen to twenty years were all taken based on these indicators. The Maastricht treaty was designed around the idea that GDP Growth is the thing that every country needs.

Today we are seeing that these traditional indicators do not work anymore. They promote increasingly bad decisions for people and the world. They lead to favouring investors over normal people. They give more and more power to the rich, and tear at the social fabric of our societies. We are getting to a point where it is becoming clearer and clearer that we are no longer creating good and prosperous societies that way. Just the other day we had posted a text that shows how the UK is actually promoting poverty with the way politics are making decisions there — decisions that are taken primarily to promote economic growth.

In other words: the idea that every generation will have a better life than the one before it is being reversed — if we continue like this, the quality of life will drop significantly, for all of us. And we need to do something about this.

The realisation that this whole idea of GDP growth and our over-reliance on “old numbers” must end is not at all new to the statistics people at the OECD. Quite the contrary — they publish studies and talk about what we need to focus on: other numbers, those that promote real wellbeing.

One example: Is it enough to simply ask whether we have less unemployment? Or shouldn’t we start asking what kind of jobs we are creating? It’s not the number of jobs alone, it is the type of jobs and how well they are paid, and what they do to our societies. If you ask that type of question, you will act very differently when Amazon comes and wants to get subsidies for creating jobs in your town or region or country. If you look closely, you may realise that the jobs Amazon can offer may not be good at all for your communities. And so you may say “no, thank you”, to Amazon and try to find investors and companies that offer actually decent jobs.

What we learned at the OECD Forum, in a nutshell, is this: Statisticians and economists from governments all around the world and at the OECD as well have developed many new ways of measuring and assessing whether people and nature in a country, or in all countries around the world, are doing well or not. And they are sharing these ideas at these conferences, they are discussing them, and they have answers and ideas for a different way of organising our world.

But the politicians, the people who actually make these decisions, are not listening yet. Except for a few. The governments of New Zealand, of Iceland, of Scotland — they are. They have started to realise that the old numbers don’t work anymore. They have developed and implemented new numbers and new systems to look at how people are actually doing. And in the WEGo initiative, they are getting together and trying to learn from each other.

That is why the WEGo initiative is so important, and that is why we are following that project for our film.

 

Categories
Gross Domestic Product Sustainability

World Economic Forum: “Forget GDP.”

On November 13th, Pushpam Kumar — Chief Environmental Economist at the UN — published a text on the “Agenda” blog of the WEF website, cautioning against the use of the GDP as the primary yardstick for economic and societal progress. Titled “Forget GDP – for the 21st century we need a modern growth measure“, he is quite explicit about the GDP’s shortfalls:

GDP provides measurements of output, income and expenditure quite well, and these are needed to understand and devise fiscal and monetary policies. But this measure flatly fails when it comes to wellbeing.

And he quotes a UN report that shows that nature “goes down” while the GDP goes up:

The UN Environment Programme-led Inclusive Wealth Index shows the aggregation through accounting and shadow pricing of produced capital, natural capital and human capital for 140 countries. The global growth rate of wealth tracked by this index is much lower than growth in GDP. In fact, the 2018 data suggests natural capital declined for 140 countries for the period of 1992 to 2014.

As a consequence, he advocates five factors that a better measure for progress should consider: financial and produced capital (these are the more traditional output-based measures, interested in assessing whether more has been produced and earned), plus: skills in the workforce (human capital), cohesion in society (social capital) and finally, the value of our environment (natural capital). The approach is still a very monetary one — he argues in terms of what all this is “worth” to us, financially speaking:

Natural capital assets such as forests and water bodies have only been valued for the products they provide for the market, such as timber and fish. However, these ecosystems offer a much larger suite of services, such as water purification, water regulation and habitat provisioning for species, among many others. These are clearly valuable services.

I am unsure if true change can happen if we keep considering the financial measurement of outputs as a core element of our economic systems, and if we evaluate nature as “but a resource” that provides services which we just haven’t started including in the calculation yet. The chosen vocabulary betrays a viewpoint that still considers the “accumulation of wealth” as the core idea of any economic activity — just a more varied range of “wealth types”. And yet, it seems like a helpful starting point for those who come from a GDP point of view.

Finally, he presents a Canadian approach to measuring progress more holistically, the Comprehensive Wealth Project, which now includes the five factors. And its current results are summarised as follows in the text:

The report raises several red flags, most notably that Canadians’ comprehensive wealth only grew at an annual average rate of 0.2% from 1980 to 2015. In contrast, GDP grew at an annual average rate of 1.31% over the same period.

In other words, if you look at all five facets, the GDP of Canada may have been growing by 1.31% per year on average — so the country keeps making and earning more. But in terms of a more overall approach to wellbeing, the development has been pretty much flat.

In other words, and once again: More GDP does not mean better lives.

Categories
Gross Domestic Product Sustainability Wellbeing Economies: Concept

Criticising the GDP: a Key Concept for Wellbeing Economies.

One of the key ideas driving the fight for wellbeing economies is the realisation that the Gross Domestic Product — the GDP — and its “endless growth” may no longer be the right measures to guide our economic policies. What served us well in the past, particularly after the end of World War 2, seems to be increasingly dangerous for the development of our societies. In our latest short video, we’re explaining why that is:

Update December 3rd 2018: If you’re interested in this, here is another blog post that describes what an alternative to “GDP-thinking” might look like, and what countries are doing to implement it.