Tara Hunt interviews Marilyn Waring on measuring a country’s health and wealth

The following is a guest post by Tara Hunt, aka @MissRogue.

Editor’s Note: This interview was conducted in 2010.

Tara Hunt: It’s been more than 22 years since you wrote If Women Counted, in which you describe how the standard measurement of country health and wealth we use, Gross Domestic Product (GDP), discounts women’s contributions to the economy and rewards short-term thinking in business and industry. This book changed the way I look at the world and has been influential for many, yet the GDP is still the standard measurement used to calculate national wealth. Why do you think this is?

Marilyn Waring: Habit, ideology, lack of imagination, on some counts. On others there’s still a major chasm between the statisticians production of the national income accounts, and the way in which they are then used, or abused, as a basis for strategic policy making. When these accounts were first produced in 1953, they claimed that they were indispensable for policy formation and the measurement of a nation’s ‘well-being’.

The last UNSNA iteration in 2007, reported that GDP was an economic indicator, and should not be used to stand for ‘well-being’, and is not supposed to represent directly the ‘utility’ that people may (or may not) derive from the consumption of goods. Nice that this is now clear, but I don’t think anyone has held the tutorials with Ministers, Members of Parliament, or government’s Treasury and Finance officials.

The Stern Report on Climate Change

TH: What is it about measurement that you think is so powerful? Is measurement and reporting more powerful than policy?

MW: It suits the market. It’s a single indicator that means judgment is not required. It’s such an abstract these days, so unrelated to the applied questions about policy settings to be made on the political front line. But post the recession, many are having to go back to their models, as the usual data sets are thrown by the magnitude of change we have experienced. Of course lots of it is still in the “too hard” basket.

One of the international reports on climate change written for the UK Government (by the former chief economist at the World Bank, Sir Nicholas Stern) has challenged parts of the old approach. Up until then the narrow framework of cost benefit economics, which excludes ‘externalities’ and pretends they are just not there, had argued that taking action on global warming would be too costly to be warranted.

Overnight the Stern report rewrote the traditional tightly guarded cost benefit analysis approach, adding in the externalities. He compared the costs in reduced GDP or preventing climate change, against how much climate change would reduce future growth of GDP. Although his approach to discounting and uncertainty are contested, the consequences Stern detailed were far more alarming than the projected growth in world GDP.

Melting glaciers would reduce dry season flows to one sixth of the world’s population; declining crop yields will leave millions of people in Africa hungry and even more impoverished; acidifying oceans will see less fish; rising sea levels will displace up to 200 million people; and there will be more deaths from malnutrition and heat stress – and that’s just the consequences from the human inhabitants point of view.

Climate change presents a unique challenge for economists

Stern found that ‘using mainstream economics to analyse climate change stretched the discipline to its limits’. He wrote that climate change “presents a unique challenge for economics: it is the greatest and widest ranging market failure ever seen”.

Stern’s report called for ethical perspectives “focusing on welfare, equity and justice, freedoms and rights.” It’s not quite what I expected from a former chief economist at the World Bank – but it should never be too late for epiphanies! But one of the problems of Stern’s approach, and that of many others, is to still resort to an economic modelling answer.

The example of the Solomon Islands

Let’s put the logistical and technical questions of collecting data to one side here while I talk about the Solomon Islands, where I have worked for the past 2 ½ years as Gender and Governance Coordinator in the RAMSI Mission. It’s obvious the Solomon Islands doesn’t have the capacity to collect this data. But there’s no question the World Bank and the IMF have the capacity in their narratives to draw attention to this work. It is the basis of all food security in the country. It is what keeps people alive after weather events, when aircraft don’t fly to outer islands, when the supply ships don’t make it. And even though it now falls within the boundary of production, no one mentions it in the central economic commentaries.

The Solomon Islands has one of the fastest growing populations in the world at 3% per annum. The 2007 IMF (International Money Fund) Country report describes the Solomon Islands as the poorest country in the region measured by per capita income. In 2007, growth is expected to be 5.5%, reflecting an escalation in logging to over 5 times the sustainability rate, so that the logs will run out in 2014 with a sharp decline after 2009. The logs are already being sold at a rate 50% below the international price. Living standards will stagnate with the collapse of this trade.

The other key resources traded are palm oil, with the re-development of the old gold mine and new nickel mines to come on stream. Corruption is endemic. There are serious deficiencies in all statistics. There is no agriculture sector table in any of the SI SNA economic indicators. There are frequent reports of land tenure ‘uncertainties’ but in fact there is no uncertainty about 80% of the land, which is communally owned. AusAID, the European Union, World Bank and Japan are engaged in rural development strategies. There is an abundant resource base and resilient social networks in the wontok (pidgin for extended family/relatives) system.

The majority of the population do not have access to electricity or water. Multilaterals report that 86% of the population (my emphasis) uses an open fire for cooking – (I just love it when the IMF or the WB writes this stuff – wouldn’t it be great to see 86% of the population cooking!!!) In the Solomon Islands 80% rely on kerosene lamps as their primary source of energy, 78% do not have water piped to their household and a third do not have access to safe water. Forty-five percent of the population are aged under 15. Enrolment for secondary schools is at 30%. Malaria is rampant. SI has the highest rates of malaria outside sub Saharan Africa. The IMF notes that the major weakness in measuring GDP is a shortage of data on the informal sector.

What about the subsistence sector? Right across the vast expanse of the Solomon Islands, women are the farmers. This would easily be the single largest sector of the SI economy measured in terms of the number engaged and the time spent in these activities. In the Solomon Islands, the majority of the male population is also engaged in some forms of subsistence work in fishing, farming and building and maintenance work. I’ll attach some photos for you of typical subsistence production and services.

TH: Are there rumblings anywhere in the world today that have the promise of reforming GDP?

MW: There are mixed approaches to the challenge, which is now not so much how do we change the GDP, but what alternative new material can be brought to the data… I am on the Board of the Canadian Index for Well Being, and I think this is the most promising work in the so-called ‘western world’. I’m an admirer of Mark Anielski’s work, particularly his work in Nunavat, capturing another cultural expression of what well-being might mean.

TH: Much ado has been made over Bhutan’s Gross National Happiness – even France’s President, Nicolas Sarkozy, recently proposed France adopt a similar measurement of wealth. What are your thoughts on measuring happiness?

MW: I don’t think we can measure happiness, but what the discussion does illuminate is the need for different populations, communities, cohort groups etc, to be entitled to assemble what they believe to be the key characteristics of their well being, as opposed to the imposition of the characteristics of well being on a population, after having been determined at a central national level, by the same people who continue to bring us GDP.

My own response to the Bhutanese situation is affected by the treatment by the Bhutanese of the Nepali peoples who had been living there for several generations. It’s also affected by the number of women in their House of Representatives (6 out of 25), and the fact that a candidate for office has to have a degree. Now why do I think that a degree wouldn’t mean you had a better sense than others of legislating in the direction of the greatest happiness of the greatest number????

TH: I was excited to see you have a new book of writings out in Canada, 1 Way 2 C the World: Writings 1984-2006. Being a bit of a web nerd, I love the title. Is there an homage in there to the social web and mobile revolution?

MW: I liked the title and thought the only way to get it accepted and on the front of the jacket was to go to txt language. It’s a university press, though, so I think there had to be a meeting about whether they could use that on a cover – the first for UTP I believe. The book is a series of essays written over two or more decades, but the last section is very influenced by Canadian opportunities I have had, and people I have known. Who’s Counting made a difference to my life in Canada.

TH: It’s no doubt that you have been a major influence in political thinking, but it’s taken people over 20 years to start to grasp your ideas. You probably hate this question, but I’d love a glimpse into what you think the pressing issues will be 20 years from now?

MW: I am working with a lot of rights-based approaches in my work – lately with the Commonwealth Secretariat – our research on The Economics of Dignity, which looks at the situation of the unpaid carer inside a household with a person living with HIV/Aids, does this.

I’m also lucky in that I supervise a large number of doctoral students who wrestle with many public policy topics. At present a colleague and I are editing Permanent Head Damage and other thesis stories, which has been fun. It’s a collection of 20 essays.

I gain enormously from my association with AWID, the international feminist organization, and this feeds my feminism, and the knowledge that the next generations of women have energy and passion and intellect and resilience, and for those of us my age, it’s been worthwhile.

We are not disconnected with nature

In general I think about things other than the UNSNA. Most questions are more profound than economics. How do we manage and use water? There’s a major challenge around ‘public goods’. We are not disconnected with nature. We are nature. Thinking we are separated is a disorder, and economics is a key tool in this process. All of our lives are subsidized. We take from the earth without paying properly, dependent on extraction. Externalities are vast and interconnected, including major health outcomes such as the rise in asthma and bronchial disorders.

There is a convergence of crises- every living system is in decline – coral reefs, aquifers, rivers, the condition of the soil, air ….a staggering destruction of eco systems and the services they have provided and that economics has ignored. If we didn’t have occasional breakthroughs it could be very depressing.

TH: You were my thought-leading hero as my idea of the world was being formed. I’m curious. Who were yours? Who are yours today?

MW: I was lucky that my university years coincided with a wave of publications from the feminist movement: both academic and activist. So I remember names such as Jessie Bernard, Fatima Mernissi, Christine Delphy, but frankly it takes a lot to beat Virginia Woolf’s Three Guineas. Earlier I had been influenced by Bertrand Russell, and documentaries such as Peter Watkins The War Game. By the early seventies it was Bonnie Sher Klein’s Not a Love Story, and good crafted writing, fiction or non-fiction.

These days, as formerly, I am most influenced by life – what I experience and observe – which raised my initial questions which led to Counting for Nothing in the first place. I like excellent fiction at all times.

Who’s Counting? Marilyn Waring on Sex, Lies and Global Economics, Terre Nash, provided by the National Film Board of Canada

Tara “missrogue” Hunt, named as one of the most influential women in technology by Fast Company Magazine, has spent the past 15 years living her life online. In April 2009, her book on Web 2.0 and community marketing The Whuffie Factor was released with Crown Publishing. She lives in Montreal, travels around the world speaking, is writing her next book (working title ‘Happiness as Your Business Model’), is a mother of a teenager, caregiver of a small dog and is working on the launch of her startup, Shwowp. She is working on changing the world in her spare time.