What Really Counts, by Ronald Colman (prologue)

PROLOGUE

I

n 1965, I dropped out of Economics 101 at the Australian National University. I’d faithfully gone to classes and studied the assigned textbook readings but found them dry, distant, conceptually claustrophobic, and, as far as I could tell, with little apparent relation to the conditions of life I saw around me. I knew something was wrong, but I thought that “something” was me. As a young political science major who needed at least a basic knowledge of economics, it never occurred to me to question authoritative professors and texts, let alone the reigning economic paradigm they presented or the way economics was taught.

That I literally couldn’t stomach economics had to be my problem. For years that “problem” would subtly haunt me.

In the meantime, I was taken up by my other studies (especially in Chinese and Oriental Studies); by the heady atmosphere of radical politics in the 1960s, with its teach-ins, anti–Vietnam War rallies and other crusades; and then by work and travels. And yet in the midst of all these endeavors, economic issues kept cropping up, though in ways those introductory textbooks never mentioned.

In 1969, for example, six months into my first full-time job as a reporter for the Canberra Times, I was fired for printing and distributing a leaflet detailing the newspaper’s censorship and advocating that editorial policy be made by journalists rather than owners. Why, I asked,

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did three families—Fairfax (which owned the Canberra Times), Packer, and Murdoch—control nearly all Australia’s media, and what gave them the right to decide what Australians should know or not know just because they were rich?

Soon thereafter, on July 20, 1969, aboard a boat bound for Hong Kong with my girlfriend, we got news that a man was at that moment, for the first time ever, walking on the Moon. It was incredibly impressive: human beings could come up with the technology to do the seemingly impossible and overcome just about any natural force. Then, five days later, we ran into a major typhoon that knocked the ship around like a matchstick on massive waves, a reminder that whatever we human beings did, including in our technological advances and economic activity, always took place in the larger context of nature in its awesome power and complexity—a perspective that seemed entirely absent from those introductory texts.

In colonial Hong Kong, where I taught English for six months, the police were so corrupt that they’d come by every Tuesday to collect their cut from the gambling den on the floor below our school. How, I wondered, did the city’s massive illegal economy, palpable at every turn, fit into those elegant economics textbook models?

After six months I shipped out on a freighter sailing for Calcutta (now Kolkata), where I was instantly overwhelmed by the poverty, leprosy, and homelessness I saw. Everything I’d ever considered a problem in life vanished into insignificance next to the human suffering I witnessed on the streets. Did this have anything to do with Economics 101, and if so, why did my professors keep talking about averages and national income and never about the gap between rich and poor?

Later, while teaching English to Bedouin children for nearly two years in the desert hamlet of Kseifeh in Israel’s Negev desert, I applied for and won a Fulbright scholarship that took me to Columbia University in New York, where I subsequently got my PhD in political science and Middle East Studies. At Columbia in the early 1970s, the one truly standout course I took wasn’t in my field at all; it was a brilliant course taught by the great anthropologist Margaret Mead. She taught me that a scholar could communicate the most subtle, complex truths in plain language

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without any of the academic jargon that seemed to infest much of the social sciences.

Throughout my time at Columbia and for years thereafter while teaching political science at the State University of New York, the problem that had haunted me since 1965 would not go away. Beneath the whole edifice of political systems and area studies that were my focus, it was clear that powerful economic forces were at work. And yet whatever conventional economics text or study I approached produced exactly the same aversion to and dismay with the discipline that I’d experienced years earlier when I quit Economics 101.

Still, through all these studies, a light started to flicker in the darkness.

Gradually I discovered incisive and convincing critiques of our present economic system and its root assumptions that exposed deep flaws and at least showed that it wasn’t as solid as the standard texts indicated.

Those texts had talked of demand, supply, labor, income, production, consumption, prices, and inflation almost as if they were governed by self-regulating mechanisms that governments could tweak but not fundamentally alter. But now I was also coming across writers who directly addressed issues of economic power, inequality, and systemic change that were hidden or downplayed in conventional models that focused on national income, growth, and averages such as gross domestic product (GDP) per capita. I was fascinated, for example, by Barrington Moore Jr’s analysis of the transition from feudalism to capitalism, which showed that the most dramatic political changes, including the birth of modern democracy, were intimately tied to seismic economic shifts.1 I was relieved to find that systems weren’t as static and self-perpetuating as the conventional models implied. And I was even more relieved to find that some of my earlier intuitive hunches were backed by strong argument and evidence.

But all that was still theoretical, and my problem was not just theoretical. It troubled my heart to see conventional texts sideline nature’s role in powering human systems and downplay the suffering and tensions of extreme poverty, inequality, and lopsided power dynamics. In describing the mechanics of the existing economic and political models, these texts seemed subtly to accept the validity of those models and to skirt

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even the potential for deep, systemic change. And so, despite the refreshing discovery of new approaches to economics and politics, I was still uneasy, because I could see no way forward to redirect existing economic and political forces toward greater ecological sustainability, equity, and efficient resource use. It took sixteen more years to discover a practical path toward developing new, sane, and more equitable and sustainable economies around the world.

I still remember the moment of epiphany. My wife, Gwen, handed me two articles on new ways to measure progress more holistically to account for social and environmental as well as economic factors. One was by Clifford Cobb, Ted Halstead, and Jonathan Rowe in the October 1995 issue of Atlantic Monthly, titled “If the GDP Is Up, Why Is America Down?” The second was an interview with Hazel Henderson in the fall 1995 issue of Whole Earth Review, in which she described her new Country Futures Indicators.2 The same month, the National Film Board of Canada released a documentary, “Who’s Counting? Marilyn Waring on Sex, Lies and Global Economics,” that I also found revelatory.3 All three sources had a trenchant critique of progress measures based on GDP, which were widely touted by politicians, economists, and journalists as the ultimate measures of a society’s economic health. By contrast, all three critiques saw GDP being used to prop up an inherently biased value system that assesses how well off we are simply according to whether we’re making, selling, and buying more stuff. Each source presented a vision of saner, more comprehensive progress measures that integrate social, economic, and environmental perspectives and thereby lay the foundation for a new well-being and sustainability-based economic paradigm.

And so, in the fall of 1995 at age forty-eight, a light went on that launched me on the twenty-four-year odyssey described in this book.

Suddenly I realized why I had felt that what I was reading was so claustrophobic and divorced from reality when I struggled with Economics 101 thirty years earlier. The conventional texts and professors were presenting the economy basically as a closed box in which households provide labor to firms in exchange for income that households use to buy what firms produce and sell. The larger social and environmental

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realities within which the economy operated were largely excluded from that standard equation, from the widely accepted measures of progress based on that model, and therefore from policy priorities. Although I had previously sensed that basic flaw at some visceral level, I had never seen it articulated, analyzed, or expressed within the context of a solution or alternative progress measures and a new path forward. So dominant, unexamined, and taken for granted is the conventional paradigm based on the assumption of endless economic growth that I’d just blindly assumed this is the way things are and wrung my hands in despair.

As in Plato’s famous Allegory, one has to step outside the cave even to breathe fresh air and recognize the existence of the cave in which one has been so long confined. In retrospect I now see that a major chain that bound me to the cave and a huge blind spot that stopped me from understanding the problem is our modern academic proclivity for specialization. As a so-called political scientist, I was able for far too long to keep distasteful economics at a distance and thus was shielded by my discipline from even exploring the problem. Until this revelatory moment, I could not have labeled untrammelled economic growth and its social and ecological effects as a core feature of the problem, and thus I had no idea where to search for solutions.

After considerable digging and extensive reading in the mid-1990s, my second discovery was, if anything, even more startling: outstanding scholars, statisticians, economists, and researchers, such as Herman Daly, Mathis Wackernagel, and many others, had already developed the necessary tools that could enable us to develop far better progress measures. And I realized simultaneously that those new measures could provide a practical and effective foundation for a new economic paradigm that was capable of addressing some of the world’s most pressing challenges. (See chapter 15 for an example of such a new paradigm.)

Instead of assessing how well off we are according to whether we’re making, selling, and buying more stuff, as we do at present, these experts had devised some robust ways of assessing whether we’re really making what I considered genuine progress. For example, are our communities safer and stronger? Are we healthier and better educated? Are we economically and financially more secure? Is our natural world cleaner and

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healthier, and are we leaving the conditions of life on the planet in better shape for our children and for other species?

I was particularly drawn in these analyses to the emerging discipline of full-cost accounting, which tries to include the social and environmental benefits and costs of different economic activities and thus to tell the whole story of the real impacts of production and consumption.

That same formative year (1995), for instance, saw the founding of the Victoria Transport Policy Institute in British Columbia, which worked to assess the full economic benefits and costs of car, bus, and other transport modes, including crash, travel time, and congestion costs; effects on climate change; air pollution; resource depletion and land use; and more.4 For the first time, I saw a strong economic case for public transport, renewable energy, sustainable urban planning, and other policy shifts the world seems urgently to need. Now, at last, thirty years after I’d turned my back on economics, economics started to come alive, and I was drawn to it as if by a magnet.

The new measures seemed globally relevant and revealed, more clearly than anything I had ever seen, our deepest assumptions about the meaning of prosperity and well-being and about the economy on which our livelihoods depended, and they exposed our blind adherence to the dogma of limitless growth. And they did this using hard evidence, through a medium that I thought people could readily accept and relate to, in a familiar and widely shared language, and with a terminology shared with the world of conventional economics. Most important of all, in my view, the new progress measures could serve as the thin edge of the wedge of potentially profound economic and human transformation toward a more sustainable and equitable world that could further the well-being of our own and other species.

But it took one more revelation in the mid-1990s to set me on the long journey described here. Through all my voracious reading, one puzzling question kept recurring, to which I simply could not find an answer no matter where I looked. Why was no government anywhere in the world using such robust methods and insights as the basis for actually formulating policy? Why were policy makers ignoring both the analysts and the telling facts and figures being churned out by their own

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statistics agencies? And so I started wondering: might one government somewhere on this planet be persuaded actually to adopt and use the new tools to gather better and more accurate evidence and thereby be able to craft good, innovative policies that would lay the foundations of a viable and sustainable new economic system that furthers economic, social, and ecological well-being? And might its success not provide a beacon for others at a time of increasing global insecurity and concern about the future?

Thus began a journey that started with developing a rigorous, policyrelevant set of measures for what was now my home province of Nova Scotia. That work made the rounds of all major Canadian political parties and then took me from the briny, sea-tossed shores of Canada’s Atlantic coast to the islands of New Zealand in the South Pacific, to the high mountains of the Himalayan Kingdom of Bhutan, to one of the world’s largest summit conferences in Rio and the halls of United Nations headquarters in New York, and back again to tiny villages in the foothills of the Himalayas. For twenty years I worked with governments, including directly with the prime minister of Bhutan, to try and bring the new measures and the powerful social, economic, and ecological evidence they revealed into the fabric of government policy making.

This is the story of my roller-coaster adventure—with tremendous hopes as the practical foundations of a new, sane, sustainability-based economy seemed to be laid, and with equally bitter disappointments as those efforts encountered enormous resistance from powerful, entrenched interests with a vested stake in holding onto the conventional way dedicated to economic growth for its own sake. Most challenging, I was to discover, because it was so difficult to spot, was the way those established interests often co-opted the rhetoric of sustainability and well-being to resist real change and to maintain and even strengthen business as usual.

There were watershed moments, such as Bhutan’s dramatic 2012 presentation of a “New Economic Paradigm” based on sustainability and well-being to the United Nations. In response, UN Secretary-General Ban Ki-Moon declared: “The old model is broken. We need to create a new one.” And my colleagues and I then went on to assemble a global

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team of 70 top-notch economists, scientists, and other scholars to craft a possible framework for that new economy. Recalling the pivotal 1944 Bretton Woods gathering, which laid the foundation and created the institutions of the present global economic system, we dared to say we were crafting a “new Bretton Woods.”

And then there were heartbreaks as we watched that initiative (and others) unravel in so many places. Along the way from Nova Scotia to Bhutan, my colleagues and I learned compelling lessons—as much from our failures as from our achievements. Human and social (let alone global) transformation is not an easy process, and it runs up against deeply ingrained patterns, greed and ignorance, vested interests, fear of the unknown, and one’s own impatience. But in the midst of all those challenges, we did gain some hands-on insights into what works, what doesn’t, and why, and we have had some successes. There are some hard, practical lessons here that can teach us what it will take to create the new economic system that the world so desperately needs if humankind is to have a future on this planet.

Praise for What Really Counts “This moving firsthand saga explains why brilliant solutions so often languish on the periphery of public policy. What Really Counts is the compelling and inspiring story of a life dedicated to promoting holistic progress measures. It charts a practical and painfully learned path to the saner sustainable future we all need.”

—JIGMI Y. THINLEY, FORMER PRIME MINISTER OF BHU TAN

“What Really Counts is a fantastic journey on a topic—the measurement of well-being—that should be at the core of the transformation of our economies and societies. We urgently need this perspective, especially after the coronavirus outbreak, to take our world onto a sustainable development path.”

—ENRICO GIOVANNINI, UNIVER SIT Y OF ROME TOR VERGATA , FORMER OECD CHIEF STATISTICIAN

“Colman’s pioneering roadmap, built on creating a Genuine Progress Index in Canada and on his many years working with the government of Bhutan, is a mustread for anyone interested in building a future that works for all. A page-turner!”

—MATHIS WACKERNAGEL, COCRE ATOR OF THE ECOLOGICAL FOOTPRINT AND COFOUNDER OF THE GLOBAL FOOTPRINT NET WORK

“Unique, important, compelling, and timely, What Really Counts gets below the surface of what keeps our misguided reliance on GDP in place. Colman uncovers the political forces and vested interests involved with GDP measures and how they work together to stifle meaningful change toward a sustainable well-being economy and planet.”

—ROBERT COSTANZ A , AUSTR ALIAN NATIONAL UNIVER SIT Y, COFOUNDER OF THE FIELD OF ECOLOGICAL ECONOMICS

“I had the pleasure of working with Ronald Colman on the establishment of GPI Atlantic. He worked tirelessly on this mission in Nova Scotia and Bhutan, producing first-class, thoroughly researched reports that push for political change on levels from local to international. This book is timely and readable in its understanding measures of progress in terms of social and intergenerational equity.”

—HANS MESSINGER , FORMER DIRECTOR OF INDUSTRY ME A SURES, STATISTICS CANADA

Columbia University Press | New York | cup.columbia.edu Printed in the U.S.A.