Measures of social progress are as varied as the theories on how it can be achieved. Fergus Neilson believes there can be no purpose in measurement unless the indicators are relevant and their application triggers productive action.
Let’s admit it at the outset – gross domestic product (GDP) as a way to measure social progress, has had its day. It has had a good innings and has given stellar service, but it is now time to send it to the archives.
GDP has too little recognition of the costs and second-order negative effects that simple obsession with growth can generate. It has only passing recognition of welfare factors. And, it pays no attention to the fundamental changes in society and social values evident since its introduction in 1934.
I have doubts about the Kingdom of Bhutan’s adoption of Gross National Happiness. You don’t have to live in the Eastern Suburbs of Sydney to know that there are plenty of self-pitying miserablists crying into their Tignanello that they won’t be able to afford a replacement BMW ‘tractor’ until after the next bonus cheque. Happiness is purely subjective and its measurement will only reveal that one man’s meat is another man’s poison.
On the other hand, a broader measure of a society’s (rather than an individual’s) wellbeing may lead to the tracking of a better balance of factors. Surprisingly an initiative developing in China looks to have real potential - Niu Wenyuan’s GDP Quality Inde
x. This is still an academic exercise, rather than an indication of current government priorities, but its potential is measured perhaps in the degree of consternation it has stirred up at local and provincial level.
The GDP Quality Index combines five elements (all of them accessible from existing statistical sources):
- Economic quality – considers the amount of resources and energy needed to generate each 10,000 yuan of GDP;
- Social quality – includes differences of incomes between rich and poor;
- Environmental quality – assesses the amount of waste and carbon generated per 10,000 yuan of economic activity;
- Quality of life – includes figures such as life expectancy, and other human development factors (education, access to age care, rates of infant mortality, etc); and
- Management quality – measures the proportion of tax revenue used for public security (might downplay that one in Australia), the durability of infrastructure, and the proportion of public officials in the population.
Noticeably, and understandably, there is a clear focus on the wellbeing of society as a whole, rather than the wellbeing of the individual in isolation. This visibly acknowledges that the state is only responsible for creating the conditions under which the individual can choose to be happy or not. There is no stop to individual freedoms, to retail consumption opportunities, to personal risk, or to softening the complexities an individual may encounter in day-to-day life. How the individual ultimately decides to take advantage of the social and economic context remains an individual (or family) rather than a collective responsibility. It is Confucianism to the core. John Knox and the critics of an ‘entitlement mindset’ would be sympathetic.
Right or wrong it does suggest that there are two levels at which the ‘measurement of progress’ should be tracked - the public and the private. I suggest that any attempt to meld the two into a single measure (or a single basket of measures) is fraught with complications. Assign to Caesar that which we elect Caesar to deal with, namely progress in society as a whole. While assigning to individuals all responsibility for their own lives, having first laid a framework that allows the individual to achieve his or her full potential.
Fergus Neilson is Co-Founder of The Futures Project. Fergus brings a wide range of business and life skills gathered from a career in the armed forces, investment banking, the United Nations, McKinsey & Company and private equity investment. Always sceptical of solutions imposed 'top-down' and increasingly frustrated by the default position that invariably sees cleaning equipment bought in only after the proverbial has hit the fan. Fergus can be contacted at Fergus.Neilson@dif.com.au.