Going beyond growth – a key step in battle against poverty
A volunteer carries food distributed by a community action center, with the assistance of the United Nations World Food Programme, into a shelter in Port-au-Prince, Haiti, May 3, 2024. REUTERS/Ricardo Arduengo
Global consensus in UN’s Pact for the Future to measure progress ‘beyond GDP’ a huge win in the fight against poverty
Olivier De Schutter is U.N. Special Rapporteur on extreme poverty and human rights & Kate Raworth is senior associate at Oxford University and author of "Doughnut Economics: Seven Ways to Think like a 21st Century Economist."
Buried deep in the Pact for the Future – a global declaration to be agreed by heads of state and government meeting at the U.N. in New York this weekend – is a pledge that, if realised, could represent one of the greatest shifts in the way we address global poverty.
Towards the end of the action-packed document, governments “reaffirm the need to urgently develop measures of progress on sustainable development that complement or go beyond GDP”.
This technical and rather dry statement betrays the enormity of what it would mean for the world to measure progress using indicators other than gross domestic product (GDP). This indicator was introduced in its modern form in 1934 by economist Simon Kuznets to measure the size of a nation’s economy.
Since then, however, it has been used as an all-encompassing proxy for human well-being: the higher the GDP, the fairytale goes, the more people must be benefiting from raised standards of living.
In reality GDP tells us nothing about the ecological or social fallout caused by economic growth. It measures the value of goods but ignores the impact – largely on the world’s poorest communities – of the lethal pollution spewed out in their production.
It measures income, but glosses over the fact that most of this ends up in the pockets of the super-rich. As US Presidential candidate Robert Kennedy famously said in 1968, GDP “measures everything … except that which makes life worthwhile.”
Greatest global challenge
Despite the best attempts of many governments, it is becoming increasingly difficult to argue that more economic growth – with the climate chaos and gaping inequalities that accompany it – is the solution to the world’s problems. This includes poverty, which the Pact for the Future dubs “the greatest global challenge”.
For too long, the fight against poverty has been used as an excuse for pursuing endless economic growth; a strategy that has led to a world on the brink of climate collapse, in which a tiny elite possesses an outrageous fortune while hundreds of millions of people suffer the daily horrors of extreme poverty. Yet we still hold our breath in anticipation of a “rosy outlook” as the latest GDP figures are released.
Instead of fixating on GDP – a number entirely unrelated to the everyday lived experience of most people – new indicators are needed that truly capture the health of our ecosystems, individuals and communities.
Policymaking in service of improving these indicators will surely be more effective at reducing inequalities, eradicating poverty and protecting the planet than policies designed to make life easier for the economic elite.
Earth scientists have been warning for decades of the perils of putting GDP above all else. Economists have gradually taken notice and launched a quest for alternative economic models escaping growth dependency.
Economic growth, they are finding out, is not only leading us to dangerously cross planetary boundaries, it also does not ensure significant progress in the fight against poverty.
Speedy action is crucial
This message has finally reached the U.N. And by including a reference to going “beyond GDP” in what is essentially the world’s blueprint for the future, it seems governments are, at long last, paying attention. The lines are shifting. In rich countries, post-growth approaches to poverty eradication are increasingly seen as a viable alternative to current trajectories. In low-income countries, post-colonial forms of growth, that are both extractive and exploitative, are coming under scrutiny.
There will be scepticism around the latest in a long series of global declarations which, for all their calls to action and good intentions, many argue slip to the bottom of the pile once world leaders return home to their desks.
Yet included alongside the commitment to consider alternative measures of progress is a commendable action plan, with an “independent high-level group” tasked with presenting recommendations to the U.N. by September 2025.
It is crucial that work in this area moves quickly, especially as the international community begins to draft the global development goals that will follow the Sustainable Development Goals (SDGs) when they expire in 2030.
Increased GDP is baked into the SDGs as a key measure of success. Whatever follows must abandon this meaningless distraction from what really matters.
Speaking on the need for the Summit of the Future at which the Pact for the Future will be adopted early next week, U.N. Secretary-General António Guterres said “we can't build a future for our grandchildren with a system built for our grandparents”.
The same applies for GDP – a measure of progress designed for our grandparents, harming us and our children, and that urgently needs to be abandoned to protect future generations.
Any views expressed in this opinion piece are those of the author and not of Context or the Thomson Reuters Foundation.
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