Last week, we asked readers to respond to the prompt, “What economics term would you get rid of, and why?” Here is our favorite reply:
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Gross Domestic Product & Gross National Product are backwards conceptions for measuring the totality of what is going on in an economy. They further bury already largely hidden externalities that have huge consequences on people, the planet, and the economy—things like pollution or illness caused by unsafe workplaces or destruction wrought by natural disasters that are made worse by economic activity that contributes to climate change. They weigh the production of military weapons that sold for X dollars as equivalent to the production of food or healthcare that sold for X dollars, when the actual impact of the weapons is far more likely to be destructive, whereas the food and healthcare are far more far likely to be constructive. It’s bad enough the way GDP & GNP add everything up willy-nilly (negative and positive things are all counted as positive numbers), but the way they are used makes it worse: the bigger the number the better! This leads to “growth at all costs” as our driving story.