John B. Cobb, Jr., Ph.D. is Professor of Theology Emeritus at the Claremont School of Theology, Claremont, California, and Co-Director of the Center for Process Studies there. His many books currently in print include: Reclaiming the Church (1997); with Herman Daly, For the Common Good; Becoming a Thinking Christian (1993); Sustainability (1992); Can Christ Become Good News Again? (1991); ed. with Christopher Ives, The Emptying God: a Buddhist-Jewish-Christian Conversation (1990); with Charles Birch, The Liberation of Life; and with David Griffin, Process Theology: An Introductory Exposition (1977). He is a retired minister in the United Methodist Church. His email address is email@example.com..
This lecture was delivered at Luther Northwestern Seminary, September 21, 2003. This material was prepared for Religion Online by Ted and Winnie Brock.
This lecture discuss two levels of caring: 1. The need to care for others. 2. But what is the goal of that caring, the common good? American history has not been clear on what is the common good.
This title invites two levels of discussion. First, there is the urgent need to revivify belief in the importance of caring for something beyond the interests of one’s self and the groups with which one identifies. Second, there is the need to clarify what the common good may be and how we can act so as to move toward it. I am not sure which of these levels is of greater importance today.
Fifty years ago, the former could be more or less taken for granted in the sense that most Americans recognized that, at least for purposes of social policy, they should be concerned for the people of the nation as a whole and that, for purposes of international policy, they should be concerned for the world as a whole. I do not mean that in fact most Americans acted consistently for the common good. I mean only that the basic Christian teaching that we should be concerned for others as well as for ourselves was taken for granted as normative. The major need was to understand the situation well enough to see what the implications of such a belief are and then motivate people to act as they recognized they should.
Of course, the acceptance of the belief that we should act for the common good led to a great deal of self-deception and hypocrisy. We had to think up reasons why enslaving Africans was for the common good. We had to figure out justification for our genocidal treatment of Native Americans. We had to explain how economic policies that supported capital against labor were really for the good of all.
But we should not suppose that the effect of this basic Christian belief was only to stimulate hypocrisy. It also contributed to the abolition of slavery, to a belated and partial humanization of policies toward Native Americans, and to the more balanced approach to capital and labor of the New Deal. Moral beliefs don’t govern public actions, but they are not irrelevant to them either.
This basic Christian belief is by no means limited to Christianity. In one form or another it is part of the teaching of all the religions that developed in what Karl Jaspers taught us to call the axial age, the middle of the first millennium before Christ. To many people it came to seem a simple matter of common sense. Accordingly, it survived the early stages of secularization during the Enlightenment. Philosophers explained that it was a purely rational principle. Indeed, it may be that the principle received clearer expression among some Enlightenment thinkers than it had among many Christians.
However, as secularization has proceeded, the idea has lost ground. Today, ethical teachings such as this are rarely regarded as objectively given or derived by reason. Instead, they are understood to be constructed by cultures. Most cultures, or at least the ones that have survived, inculcate socially beneficial behavior within the community. But most give little attention to any notion of a wider good for all human beings or all creatures.
When individuals realize that what they understand to be their moral obligations are simply the teachings of a particular culture, they discover that they are free to pick and choose among them or to reject them all. Individuals can create their own moralities. If someone sees no reason to modify self-interested behavior for the benefit of others, philosophers can provide no reason why they should. One is free from moral restraints to act as one chooses – so far as reason is concerned. Other thinkers will argue that rational, and, therefore, good behavior is, indeed, behavior that is calculated to obtain as many desired ends for oneself as possible. If one happens to desire happiness for someone else, then benefiting that other person is rational and good. Otherwise, not. There is no reason that one should desire the well being of another.
There is, then, no reason that one should care for the well being of one’s community over against others. However, there are few who lack this preference. It is natural to identify strongly with the group of which one is a part over against others. Most people get much of their personal satisfaction from the success of the groups with which they identify.
Religious communities are among those whose successes give satisfaction to their members. In a global context of religious pluralism, this has often been a source of destructive competition and even of warfare. On the other hand, we noted that the teaching of the major religious traditions has countered this tendency somewhat. “God” can function as a rallying cry of one religious community against others or as a call to be concerned for all communities and all creatures. Where this latter check on parochial tendencies is gone, a positive interest in the well being of communities alien to one’s own finds little purchase. At that point, for example, when the perceived interests of one’s country run counter to that of other peoples, it is widely felt to be unpatriotic to care about those other people. Since they oppose us, they are, by definition, bad.
If I am correct that there has been a narrowing of the horizons of concern in the American public, and a franker affirmation of individual egoism and of national self-interest as determinants of action, we need to ask why. Such changes are always complex, but I will life up two factors that I believe to be important.
First, the religious climate has changed. Christianity as a whole has lost status in the culture. It has been sharply separated from the general educational system, and its own, separate, educational system does not reach as many people, and is less effective even for those it reaches, than was the case in the decade after World War II. This is partly because the relatively stable communities in which the churches played a significant role have given way before rapid mobility.
It is true that the decline in the old-line churches has been accompanied by the rise of some conservative ones and of mega-churches. These certainly teach that individuals should be concerned for other individuals. It is less clear that most of them emphasize the concern Christians should have for people of other nations and other faiths, especially for those who do not welcome our values and ways of doing things.
Second, I suggest, the popular understanding of Christianity as it functions in the public arena is now more legalistic than ever. Fortunately, legalists teach that we should act with regard to consequences for others as well as ourselves. But this sort of obligation lies alongside rules of conduct that are not guided by love. The all-determinative importance of love as taught by both Jesus and Paul is largely lost. Since it is love that drives the authentic Christian concern for other individuals and other peoples, this shift to law is part of what weakens our witness. It also confirms the dislike of Christianity in much of the secular culture.
The vacuum created by the decline of Christianity and by its legalistic distortions has been filled by an ethics drawn from the description of behavior. The most influential is the portrayal of human behavior in economic theory. Human beings are depicted as seeking to gain as much as possible while giving as little as possible in terms of money or labor. The description has obvious applicability to how we behave in the market place. Yet even there, there are many exceptions. For example, many people choose work that they find meaningful, sometimes because it involves meeting real needs of people, rather than because it pays more. Many people financially support causes in which they believe even when there is no promise of personal reward. Even in the market we do not function quite in the way that economists regard as rational.
If this model of self-interested behavior oriented to material gain were used only in one academic discipline and successfully countered by models used in other disciplines, the consequences might not be culturally serious. However, this particular discipline has become the most prestigious and influential of the social sciences. The model of human beings developed by the economists now affects the way human beings are understood in other sciences as well, both natural and social. Government policy is affected by this one science far more than any other.
The economic view of the human being has come increasingly to be the one into which students are socialized in universities. Indeed, universities now make decreasing claims with respect to broad humanistic contributions to their students and emphasize instead their contributions to the student’s life-long earning capacity. Students who are going to universities to increase their cultural appreciation or become more effective in service are few and far between. We expect students to have practical goals, which means self-interested ones in economic terms.
We are increasingly extending this mentality to and in the church itself. We expect people to “shop around” for a church “that meets their needs.” In the face of decline, we conclude that we must “market” what the church has to offer more effectively. Calling on people to sacrifice for the sake of the neighbor, especially the neighbor who may be a competitor, does not fit this market model.
All of this is to say that the church is profoundly challenged to make its most basic message effective. It needs not only to make it clear that God calls us to love the neighbor, including the “enemy,” it needs also to help its people make this a reality in their own lives. It does not work to treat the call to love as one law alongside others. Love of others grows only as it is nurtured in a loving community that points also to God’s love of all.
In this account, I have omitted the term, “the common good.” It is, of course, not a biblical term. But it is meaningful and important. The biblical emphasis is on the love of individual neighbors and the Christian communities. In a context of political powerlessness, that is the appropriate emphasis. But when Christians have some ability to shape the society in which they live, they need to draw out the implications of neighbor love in other ways. Often the best way to show love for individuals is to improve the quality of the communities in which they live. By serving the common good, more are benefited than by trying to help each one individually. By working for the common good, we can express love for those about whom we know nothing as well as for those of whom we have personal knowledge. Since all are of equal value to God, this is important.
For those who do care about the common good, the next question is what it is and how it can be implemented. Utilitarian ethicists identified the common good with the greatest good of the greatest number. This is certainly a good approximation. But we are not likely to get very far in promoting the common good, if we think only in this way. The usual formulations of utilitarianism assume an individualism that in principle works against the common good.
The economic theory of which I have spoken operates in this individualistic fashion. Based on its assumptions about human beings, it argues that the greatest good of the greatest number is served best when each person works aggressively for his or her own economic interest. This theory of the coincidence of individual self-interest and public benefit has been of immense importance in shaping the contemporary mind and public policy.
Given two assumptions, standard in economic theory, the judgment that individual selfishness promotes the common good should work. First, we must assume that what human beings most want are increased consumption and possession, on the one side, and reduced effort, on the other. Indeed, we must assume that these are their only significant desires. Second, we must assume that natural resources are in principle, or for all practical purposes, unlimited. With these two assumptions in place, supporters of the theory can show that as each actor in the market behaves rationally, that is, seeks to get as much as possible for as little as possible, resources are used efficiently and there is an increase of the total quantity of goods and services consumed. Since this is the measure of the common good that has been adopted, the case is made.
Note what happens in the pursuit of the common good that follows this model! All truly personal relations are under siege. In pursuit of gain or reduced labor, persons are expected to move where production is cheapest or where wages are best. Clinging to existing human connections is viewed as irrational. Further, all relations are competitive. This is true not only of the relation of labor to capital and of corporations in relation to one another. It is also true of workers seeking better jobs or simply to keep the ones they have. This system may increase the amount of goods and services consumed, but it certainly works against traditional communities and against the formation of new ones.
The destruction of community is manifest when a factory closes and moves. According to the theory, the common good is served when capital is most efficiently invested. Accordingly, if labor becomes expensive in one locale and production can be moved to a place where it is cheaper, a rational management will move production. Since the overall effect will be to increase production and achieve cheaper prices, the common good is served. But we know from many studies that many lives are ruined.
The destruction of community is also visible in the rural area. As agribusiness replaces traditional family farming, goods are produced with less labor. This is a gain in efficiency. The result is to displace most of the former farmers. Hundreds of villages and small towns have disappeared as a result.
If we understand that human relations are important to people, then we will see how doubtful it is that the common good is served by this continual disruption of human community. This is not to deny that having more goods and services often contributes to the common good. I enjoy television and now find E-mail indispensable! These gains are ambiguous, but I give testimony to the fact that for me they seem to promote the common good. On the other hand, my participation in the common good is served far more by living in a community of retired church workers with whom I share many interests and commitments and who care for one another and help one another through the difficulties of aging and dying. We really don’t know how our lives would be improved by increased consumption.
We are not so exceptional in this respect. Studies of happiness show that beyond a certain minimal point, increase in goods and services does not add to happiness. People like to be among the more favored members of their communities, so that individuals become happier when their relative standing is improved. But to be near the bottom in a society of low consumption seems to be no worse than to be near the bottom in a society of high consumption. That means that, in general, economic growth does not contribute to happiness. Yet our whole society is organized around that goal!
I mentioned a second qualification of the validity of the theory of the coincidence of selfishness and the promotion of the common good. One must assume the practical inexhaustibility of natural resources. This has been important for economic theory and practice, and economists can point to many instances in which they have been proven correct. Their point is that technology can substitute plentiful resources for those that become scarce. Plastics replace scarce metals, for example. New energy sources replace those that are exhausted.
The issues here are complex. But those who pay most attention to our natural environment see signs of decay everywhere. Soil is washed away, aquifers are exhausted, forests disappear, animal and plant species become extinct, the ocean is polluted, and weather changes for the worse. Perhaps we can find new sources of energy as oil gives out, but their use is likely further to degrade the world. All of this reduces the quality of human life as well as of the created order in general. As prospects of shortages loom, the United States uses its military power to insure its control. To use a notion of the common good that ignores all this, seriously misdirects human efforts.
If individualistic and materialistic thinking had not become so dominant, noone would suppose that aiming at endless economic growth by encouraging self-interested behavior on the part of all was the way to advance the common good. The very idea of the common good implies that we are bound together, that the good of one depends on the good of others and supports their good. Of course, the idea of the common good does not exclude elements of competition. Competition can sometimes bring out the best in people. But surely competition should operate in a larger context of cooperation and mutual support if there is to be any advance of common good.
I find of interest here an experiment that was conducted rather widely a couple of decades ago. In this game, people were given tokens that they could use in one of two ways. If they wished, they could exchange them for one cent each. The other choice was to put them in a pool in which they would be worth 2.2 cents each, but which would then be divided evenly among all players. According to economists, rational players would exchange all their tokens for one cent each. They would still share in whatever other players put in the collective pot, thus maximizing their income. In fact, however, most players divided their money more or less equally, saying that they thought this was fairer. The one exception was a group of first year graduate students in economics, who put only 20% of their money into the collective pot. Two economists commenting on the experiment wrote: “Evidently the run-of-the-mill players are not strategically sophisticated enough to have figured out” that they should have kept all their money for themselves. (For the Common Good, p. 91)
Ironically, however, we notice that it was these unsophisticated people who profited most from the game. In fact, they would have profited still more had they put all their money in the collective pot. The sophisticated economics students got less monetary returns from their more rational strategy. If they had been still more “rational” and exchanged 100 % of their tokens for cash, they would have gained still less. Those groups where an interest in the common good was greatest were the ones who individually gained the most.
My fear is that if the same experiment were repeated today, the percentage of the money put in the common pot would be less. The idea that true rationality is pure selfishness, and that one’s self-interest is always to get the most one can for oneself, is becoming more pervasive in our society. But as we see from this experiment, the result is that we all lose.
We have seen extreme expressions of this individualism in our corporations recently. We have long expected corporations to behave in a primarily selfish way, seeking profits for their stockholders above the well being of their employees or the public. But within the corporation we have assumed that cooperation and personal service to the corporation were normative. Now we find that many executives put their personal profits above the well being of the corporation and its stockholders, sometimes in extreme ways. That this “rational” behavior is profoundly contrary to the common good is surely apparent to all.
In case anyone is still not convinced that narrowly self-interested individual behavior, far from advancing the common good, is profoundly inimical to it, let me illustrate its adverse effects in one more way. I spent most of my career teaching in a theological seminary. Like most such institutions, raising sufficient money each year to pay its bills was an ongoing challenge. If one part of its budget was increased, other parts of the budget had to be cut. Our salaries were below average; so faculty had some justification for asking for more. Nevertheless, an increase in salaries either meant fewer colleagues or less money for staff and students.
Now in such a context some faculty are more mobile than others. That is, some could easily find other positions, perhaps ones that paid better; others could not. Those who could most easily move were also those who brought most prestige to the school. Consider two ways they could behave.
One way would be to demand higher salaries for themselves. This would be rational behavior as that is generally defined today. Administrators would be under great pressure to give all money available for raises to these professors, taking advantage of the fact that others had no good alternatives to accepting whatever they were offered to deny them raises. Indeed, that might be considered rational behavior on their part. However, I do not need to describe the result in terms of faculty morale and the loss of faculty solidarity.
We would have to ask whether a professor who got a larger raise in this way would truly be better off in the resulting context of decaying community. I think we all know that, even measured by quite selfish standards, the answer is No. Destroying our social context for the sake of greater income does not enhance our personal well being. Some economic sacrifice for the common good works much better in that regard.
Perhaps I am too long repeating the obvious. At least this is obvious to me, and I think should be obvious to all Christians. However, I state and restate the obvious because we have collectively acquiesced in a system that is based on the opposite assumptions, one that endlessly destroys human community and degrades the natural environment on the grounds that this increases total wealth. Frankly, I am keenly disappointed that the policies that are grounded in this egocentric understanding of human beings are still supported by many Christian ethicists and church leaders. I am glad to say, on the other hand, that other voices have gained the upper hand in important circles.
Let me make the contrast clear in terms of actual choices that have been made and are continuing to be made by people of good will. I will take the field of Third-World development as my example. People of good will agreed, after World War II, that there was too much poverty in these countries and that an increase of goods and services was needed. There were two quite different approaches to improving the economic life of the poor, most of whom lived in agricultural villages.
Mahatma Gandhi favored community development. He thought that the economic condition of the villagers could be improved by introducing what is now called appropriate technology, that is, technology they could easily learn to use and to maintain. The symbol of this was the sewing machine. Others have favored the steel plough, or solar cookers. Community development can also focus on nearby wells and woodlots, which can save large amounts of labor. Sometimes the issue can be better access to markets. Often educating women about contraception and providing elementary medical care are of crucial importance to the quality of life in rural villages. In any case, in community development, what is needed must be the decision of the villagers, and they must have ownership of any new equipment that is provided them.
Improvements of this sort increase the income of the villagers. This leads to expanded consumption. Gradually, small industry should develop in some towns to meet the new needs and desires of the peasants. The villagers will be ready for somewhat more complex equipment. Technological advances will occur organically. But these should be judged by their impact on the land as well as their labor-saving character.
Many NGOs, church related and others, work at this kind of development. It can only be done village by village by people who are willing to spend time living with the villagers. Accordingly, the increase of per capita production and consumption is slow. But this increase is hardly an adequate measure of the full improvement in the quality of life that can occur as the villagers are helped to work together to solve their own problems. The quality of human relations is likely to improve as well as the self-respect of the villagers.
The other form of development aims to increase per capita production and consumption rapidly. In India, it was favored by Nehru, who succeeded Gandhi as leader and was informed by his British education. The symbol was the large steel mill that the Soviet Union gave to India. The World Bank favored large dams that would produce water for irrigation and electrical power. This is, of course, the industrial model.
The standard procedure is to move large numbers of people from agricultural production to industrial production. To pay for the industry, agriculture must produce products for export. Shifting from peasant farming to agribusiness both increased produce available for export and drove peasants off the land into industrial cities. The Green Revolution supported this change. With fewer farmers producing as many or more products, and others available as cheap labor for industry, the overall productivity of workers is quickly increased.
The downside is that this type of development is directly destructive of existing community and works against the development of new forms of community. Villages are flooded or depopulated as the young women and men, finding little to do there, are forced to move to industrializing cities. Traditional values are weakened, with only money offered as an alternative. Although the income in cash in cash of the new workers is likely to improve, the quality of their lives rarely does. Whereas, in the village, the peasants may have some control of their own lives, and they tend to help one another through crises, laborers in factories have very little control of their lives and few systems of mutual care. Self-esteem often suffers. Those left behind are often poorer than ever.
Meanwhile, another segment of the population, able to control the new agribusiness and industry, grows much wealthier. The gap between rich and poor widens. Both agribusiness and the new industries tend to degrade the natural environment. Nevertheless, this is the kind of development to which the industrialized nations, the World Bank, the International Monetary Fund, and the World Trade Organization are committed. It is the justification for the North America Free Trade Agreement and of the proposed Free Trade Agreement of the Americas.
It is believed that this kind of development can proceed most rapidly through foreign, corporate investment. To encourage this, Third World countries remove barriers to trade and investment, lower their wages and environmental protection, and put their businesses and even their infrastructure up for sale to the highest bidder. This “liberalization” has come to be a central demand of the economic rulers of the world.
According to standard economic measures, the success of a few Third World countries, especially in East and Southeast Asia, has been remarkable. They have attracted huge amounts of investment capital and have industrialized rapidly. Chiefly, it is a matter of foreign corporations producing goods for foreign markets, but fairly rapidly indigenous ownership and consumption also rise. The costs of which I have spoken are paid, but at least in some countries the desired economic growth has also occurred with one segment of the population profiting impressively.
I say this to give a balanced picture. Opinions differ as to whether the people of Thailand, for example, are truly better off now than they were several decades ago, but to whatever extent well being is measured by the availability of modern conveniences, they certainly are. Those who are doubtful point to the deepening misery of the poor, the loss of traditional values and community relationships, the looming ecological crises, and the structural dependence of prosperity on decisions made in financial centers in other parts of the world. From the point of view of serious Buddhists, the new religion of consumerism is a spiritual disaster.
In other parts of the world, there is no ambiguity. In much of Africa, standard development policies have left social and ecological havoc in their wake while largely destroying what industrial production was once there. In Argentina, the modern economy has simply collapsed. In much of Latin America losses have outweighed gains by almost any measure.
Ironically, although much of this havoc has been through the imposition of policies desired by Washington and thought to be beneficial to us, we as a people have not gained. Following the theory faithfully, American corporations have moved their production in large part across the border to Mexico and across the ocean to China and Southeast Asia. The gains of some sections of those populations have been at the expense of industrial workers in the United States. Now a similar movement of work is taking place for clerical and more skilled workers. In this context, American wages have not kept up with inflation, job security has become a rarity, increasing numbers have no medical insurance, fulltime work does not enable families to support themselves, infrastructure declines, and the natural environment suffers. The only incomes that increase significantly are those of the rich. Nearly half of all Americans now have virtually no net worth or have debts that exceed their assets. Half the wealth of the country is in the hands of a small percentage of the population. The federal government has unprecedented debt, much of it owned by foreigners.
True believers in the dominant model tell us that the solution of our problems is to reduce taxes on corporations and the rich, reduce government services to the poor and middle class, improve the climate for business by reducing work place and environmental protections and minimum wage requirements, privatizing public services, and facilitating the investment of capital overseas. One wonders how much more the nation and the world must suffer before we will recognize that the fundamental view of the common good that is taken to justify all these steps is radically erroneous!
I concentrate on theoretical questions, one might say, theological ones. It may be that those who press hardest for the dominant policies are in fact aware that they do so for simple self-interest, not because they really believe that these policies will benefit the people of the nation or the world. It may be that, for them, the theoretical justification is irrelevant. But they would not have been able to dismantle so much of the painfully won gains in the common good achieved during previous decades had they not had the support, or at least the acquiescence, of many people of good will. I include among these most professional economists. I also include many conscientious ethicists. And I include many who look to economists and ethicists for guidance without reflecting much for themselves.
Even today, our government uses moral arguments to press for popular support of the Free Trade Agreement of the Americas. It tells us that only further liberalization can solve the economic problems of Latin America. Even today, people who should have learned from experience, people who should listen to the misery of the victims of these types of policies, continue to support them because they are told that experts do so. We continue to destroy the common good in the name of serving it.
It is my view that people of good will should be able to see that an individualistic and competitive approach to the common good is wrong in principle. They should also be able to see that, after our government and its allies have applied it vigorously for several decades, the ills of the world have increased. But sadly, I know that many still do not agree. Hence, I add a final word.
Even if we suppose that the only considerations that matter are economic ones, present policies are misdirected. The growth at which they aim is costly in economic terms. Today the cost of growth, at least of the growth that is attained by present policies, equals or exceeds the value of the growth itself. We are making enormous efforts, and the result is to stand still even in purely economic terms. If we employ broader social and psychological measures of human well being, our present policies have led to massive losses. On the other hand, if we redirected our efforts we could make genuine economic progress, even if it would be slow, and social and psychological progress could replace the present decline.
Obviously, I need to explain this. First, note that when we are told that we are making economic progress, we are referring almost always to Gross National Product or Domestic Product. No economist claims that this is a direct measure of economic well being, but almost all economists acquiesce in its use as if it measured something economically desirable. This assumption has been challenged from time to time, and this challenge should be vigorously pursued.
So far as the GDP is concerned, governmental expenditures on war in Afghanistan and Iraq count as much as similar expenditures on health or education. You may think that on some other than economic basis, such as security, these expenditures have improved your lot, but economists would not regard this as economic gain. Similarly, when crime increases, increased expenditures to counter it add to the GDP. Economists do not regard this as an economic gain. Indeed, when pressed, economists do not consider government expenditures in general as a contribution to the economic well being of the nation. They focus on the other segment of the GDP, personal consumption. They would approve, I think, if we used just that figure to measure how well we are doing economically.
However, they acknowledge that even that figure excludes important contributions to economic well being and includes expenditures that do not add to such well being. For example, the positive contribution of housework is not included. Yet the cooking, cleaning, home improvements, and childcare that homeowners and parents provide is just as much a benefit, in strictly economic terms, as when the cooking, cleaning, home improvements, and childcare are provided commercially. Part of the increase in GDP during the past thirty years results from a shift from families meeting their own needs to paying for services from others.
To get some sense of what is entailed, consider the change that occurs when a second parent goes to work, usually the mother. The family begins to spend much more money, and all of this is counted as an increase in personal consumption. But half or more of this may be for services that the parents can no longer provide themselves or for needs that arise just so that the mother can get to the job, dress properly for it, and meet other attendant obligations. Sometimes a second car is required. There is also the possibility that the children may need more psychiatric care when they see so much less of their parents, but I will not get into such indirect costs. My point is that there are, here, strictly economic costs of the increase of the measured personal consumption.
Now consider a quite different example of the uncounted cost of growth. Suppose an earthquake causes five billion dollars worth of damage. Nothing is subtracted from the personal consumption figure in the GDP as a result. But when five billion dollars is spent on restoring the destroyed homes and businesses, this is added in. Common sense would suggest that in fact, in strictly economic terms, nothing has been gained. Actually, all the extra costs involved in detouring around broken bridges and arranging for temporary housing will show up as positive contributions to personal consumption rather than costs to be subtracted from it.
Another large area is environmental costs. All of our consumption of scarce resources, such as oil, adds to personal consumption. Nothing is subtracted for the reduction in what is available. Similarly, when we cut down our forests, that adds to personal consumption. The fact that there our forest resources are not diminished. If extracting oil from the earth becomes more and more expensive as it becomes scarcer, that simply adds more to personal consumption. Consumption is not measured by the amount of gasoline purchased or the number of miles it enables us to drive. It is measured only by the cost. As gasoline becomes scarcer and more expensive its use adds more to the personal consumption figure.
Increased pollution similarly shows up as a positive at least insofar as we respond to it. If pollution kills trees, that does not subtract from personal consumption, but if we spend money on gasoline additives or add equipment to reduce this killing, that improves the personal consumption measure. When the air becomes polluted so as to increase asthma, the increased costs of treating asthma adds to personal consumption. When costly steps are taken to reduce this pollution, that also adds.
Now it would seem to make more sense to subtract the economic costs of dealing with pollution and its consequences from the gains that have been made in the act of producing that pollution. The present system treats the costs of restoring the situation to what it was before we polluted to the economic gains made in the process of polluting. In other words, the costs of growth are added to the benefits of growth. If we are seriously interested in aiming at the improvement of the economic condition of a people, then this seems crazy. I think it is.
Let me note that some economists who recognize that personal consumption is not a good measure of economic well being say that it is good measure of market activity and that, for some economic purposes, it is important to measure this. My quarrel is not with measuring market activity and drawing conclusions from its increase and decrease. My quarrel is with selling an increase of market activity to the public as if it were in itself an economic advantage. It may or may not be. That can only be determined by subtracting the costs of the economic activity from the gains it pursues.
Sadly, in my view, very few economists are interested in this project and no governments have yet undertaken it. I have heard recently that it is possible that the government of Canada will do so. But in the meantime we must acknowledge that we do not know just what the results will be.
Nevertheless, the question has seemed important enough to me to press ahead in an amateurish way with some colleagues and especially with the help of my son, Cliff. You can find our results for the United States in the period after World War II in an appendix in the book I wrote with Herman Daly. Although our efforts have had little influence among mainstream economists or governments, groups in ten or more other countries have developed similar measures. An organization in San Francisco has developed our measure for the United States, and it annually reports on what it calls the Genuine Progress Indicator.
, None of the statistics that have been produced thus far have the benefit of the resources of a national government for the collection of the needed data. Little of the work has been informed by the skills of the more prestigious economists. Accordingly, it would be unwise to lean heavily on the exact figures in any of these measures. But it is significant that almost all of these measure show that the cost of growth in recent years equals or exceeds its benefits. Whereas there have been periods in the past when economic growth definitely benefited people economically, this is no longer the case. Surely that is an important fact. It makes no sense to commit ourselves to policies to increase something that does us no good. Surely it is time for us to shift our shared national goal from increasing economic activity to enhancing the common good. Otherwise, what is government for?