The rise and fall of the GDP
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Sichuan is leading the rest of China along the new path. But national economic planners have already realized that taking the GDP track has been at the cost of a deteriorating environment. Nationally, air pollution, water shortages, polluted water, desertification and soil pollution all worsened as the GDP indicators improved. Gaps between rich and poor widened and there was uneven development between regions.
Sichuan's success will depend, to a great extent, on the ability of the national planners to wean economists off their cultish obsession with GDP growth. This is especially so as local governments everywhere else in China are required to make due contributions to the nation's annual GDP growth.
But while China awaits the result of the Sichuan experiment, other nations are quickly following suit.
Shortly after his five-day visit to China, Britain's Prime Minister David Cameron publicly announced that is government will be relying less on GDP as a yardstick of national progress.
The developed nations are also slowly coming around to the reality of the GDP yardstick. Canada earlier this year introduced an Index of Well Being to reduce reliance on and offer a counterweight to the GDP. France and Germany have also been making silent moves in that regard.
The USA is also silently moving towards reducing reliance on the GDP. President Obama's Health Care Bill included a demand that Congress finance and oversee the creation of a "key national indicators" system called "State of the USA", to be published online. It challenges the GDP by having hundreds of measurements for key national indicators and came into force last summer.
French President Nicolas Sarkozy appointed a special commission – the Stiglitz Commission – to find an alternative to the GDP, which has submitted a report and recommendations. The Commission concluded that assessing a population's quality of life will require information from at least seven categories: health, education, environment, employment, material well-being, interpersonal connectedness and political engagement. The recommendations have also been adopted for debate by the Statistics Office of the European Union and by the Paris-based Organization for Economic Cooperation and Development (OECD).
The world is coming around to accepting that indicators take into environmental and social factors into consideration.
But while the rest of the world and the rest of China are proceeding at a snail's pace, some are already thinking of how best to quicken the pace.
"People should be happily busy and busily happy," says Professor Chu Guangyou, former vice president of the China Foreign Affairs University.
He too proposes new yardsticks. By his measurement, "Development, reform and stability are the three basic ingredients for success". He also adds, simultaneously, that "income disparity, social equity and justice" are three necessary indexes also to be measured.
China's figures tell the story well. Since 1978, some 250 million Chinese have been removed from poverty, but 40 million still live in abject poverty and 120 million exist below the poverty line – as defined by the UN. It is also estimated that in the PRC, the top 1 percent of the population account for 40 percent of its economic and financial wealth, while the bottom 1 percent account for only 4 percent.
Redressing these imbalances is a mammoth, monumental task of seismic proportions.
The author is a journalist from St. Lucia. embousquet@gmail.com
Opinion articles reflect the views of their authors, not necessarily those of China.org.cn
