The Years of Our Discontent
Economists love a number. For them, like for the rest of us, a number projects certainty. Put a string of numbers together, they can make a graph; show us what’s better, what’s worse. Are we gaining or losing?
Some eighty years ago, a then relatively obscure economist Simon Kuznets created a number to measure national income. Since then the Gross Domestic Product (GDP) has been the yard stick that economists, government agencies, reporters and politicians use when talking about how the economy is doing.
In politics, the economy matters. When the economy is growing, jobs are plentiful, and people are doing well, incumbents benefit. When GDP lags, voters begin looking for change. “It’s the economy, stupid,” the iconic message that came out of Bill Clinton’s first campaign, still resonates.
But is GDP a good measure of how well the economy is doing for us? The U.S. has the highest GDP in the world. And except for occasional dips, GDP has climbed steadily over the past four decades but that hasn’t translated into a similar rise in people “doing well”. Over those years, suicides, drug overdose deaths, and the use of anti-depressants have all increased.
In his report to Congress, Kuznets clearly stated, “The welfare of a nation can, therefore, scarcely be inferred from a measurement of national income,” but that has not stopped its being used over the years for that purpose. The attraction of having a number to point to, is too tempting. GDP has become the measure of success in a global economy. Public policies are designed to increase GDP.
GDP, however, is a flawed measure. Building bombs and building hospitals are equally good. Prisons are progress. Putting pollutants into the air is not a negative. Cleaning up after hurricanes, oil spills and wild fires is counted as economic growth. If two parents work and pay for child care the economy grows by three incomes. If one parent stays home and does child care GDP recognizes only the contribution of the parent getting a paycheck.
Several years ago, a group of economists created the Social Progress Index as an alternative to GDP. Michael Green, one of the lead economists in the effort describes the Index this way.
“It's a whole new way of looking at the world. (It) begins by defining what it means to be a good society based around three dimensions … does everyone have the basic needs for survival (food, water, shelter, safety) … does everyone have access to the building blocks to improve their lives (education, information, health, a sustainable environment) … does every individual have access to a chance to pursue their goals and dreams and ambitions free from obstacles?”
The Index measures outcomes for every country; not just the availability of goods and services, but also their use and distribution. It begins to answer the question, to what extent does a nation’s productivity contribute to human wellbeing and thriving communities?
Last week the 2020 Social Progress Index (SPI) was released. It didn’t get a lot of publicity.
The United States is first in GDP, but comes in 28th in this year’s SPI, down from 19th in 2011. Despite our wealth, we come in behind poorer countries like Greece, Cyprus, Slovenia and Portugal when it comes to social progress. In the decade since 2011, the United States is one of only three countries in which Social Progress has declined. The other two are Brazil and Hungary.
There is a stark contrast between our economic productivity and social outcomes driven by political decisions. We are first in the world in great universities, ninety-first in access to quality basic education; first in medical technology, ninety-seventh in access to quality health care.
What is it about our politics that has brought us to this place? And it is politics, because social progress depends on public policy. It doesn’t happen by itself. It requires government action.
Over the past 40 years an antigovernment ideology has increasingly taken hold within the Republican Party.
The progression is seen in the changing answer to questions about the proper role of government. In his acceptance speech for the presidential nomination in 1964, Barry Goldwater, still considered by some as the political father of the modern conservative movement, called government “a durable ally of the whole man”.
By 1981, in his first inaugural address, President Ronald Reagan expressed the belief that “government is not the solution to our problem, government is the problem.” Today, in the words of Grover Norquist, head of Americans for Tax Reform and a current conservative leader, the goal is to “take government down to the size where we can drown it in the bathtub.”
The President, Republicans in Congress, Americans for Prosperity, the Heritage Foundation, Tea Party groups, and various other conservative allies have tried repeatedly to repeal Obamacare, a form of universal health insurance. In contrast, conservative economist F. A. Hayek, author in 1944 of The Road to Serfdom and one of the recognized intellectual founders of modern conservatism, believed that “in the case of sickness and accident . . . where in short we deal with genuinely insurable risks, the case for the state’s helping to organize a comprehensive system of social insurance is very strong.”
Hayek went on to caution that great care needed to be taken in designing such programs to avoid dependence, but he believed that was achievable. Even though he was an advocate of competition, individual initiative, and limited government, Hayek was open to considering the specifics of a problem and the actions government might take to make peoples’ lives better. With an unwavering belief that making government smaller will make everything else better, today’s Republicans rarely ask the pragmatic question about results.
They have also proved incapable of agreeing on policy even among themselves. Despite numerous promises over four years to propose a better alternative to Obamacare, nothing has surfaced. There was no Party platform proposed, much less adopted, at this year’s Party convention. With Covid sweeping the country and the economy tanking, Sen. Lindsey Graham, Republican of South Carolina, told Fox News that most Republican senators would not support any additional relief. “Half the Republicans are going to vote no to any Phase 4 package. That’s just a fact.”
For 36 of the 40 years since 1980, the Republican Party has controlled the presidency or either the House or Senate, giving them veto power over policy initiatives. Only during the first two years of the Clinton administration and the first two years of Obama were Republicans in the minority in both House and Senate.
With the self-proclaimed anti-government party of “no” having veto power for all but four years since 1980, it is not surprising that social progress has declined. They have done what they said they would do. They have followed their principles. We have all paid the price in the quality of our lives. The Social Progress Index puts a number on it.
Douglas Kane is the author of "Our Politics: Reflections on Political Life" published in 2019 by Southern Illinois University Press
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