What Is GDP?

Bullfight by Pablo Picasso

Whenever their stuffed animals fall apart, my kids get their great-grandmother’s to stitch them up. It’s an emergency and they rush to the hospital for broken toys, which is luckily next door. This activity adds nothing to GDP but it makes the children happy and probably adds years to the old lady’s life. I think about it and I wonder. We’re really measuring the wrong things. We’re not measuring what matters at all.

As the original Robert F. Kennedy said about GDP, “it measures everything, in short, except that which makes life worthwhile.” A forest adds nothing to GDP while cutting it down is valuable. Care work, repair work, share work, these are all worth nothing. Raising children, caring for elders, caring for yourself? “Do that on your own time.” That’s the message from the ruling oligarchs, and ‘serious’ economists. Seriously? What is GDP even measuring?

These people only look at the speedometer, never glancing at the fuel (E), and never thinking that the two might be connected. And we must just keep accelerating forever, they have no concept of a destination at all. Of course this ends in ruin. How could it not? We measure only prices and destroy that which is priceless. That’s what GDP is a measure of.


What GDP really measures it the rate at which we take things out of the Earth and put them in the bin. We’re literally standing in front of a steaming trash can crowing about how big it’s getting. In geological time, that’s all GDP is. Garbage Dug from Planet. In the long run every single human product is thrown away. Every service leaves only waste heat behind. What economics calls a measure of growth is, geologically speaking, just a measure of pollution. Every year we make things that don’t decompose for hundreds of years, using resources that took millions of years to form. What kind of math equation is this? How do you think it ends?

Pollution, of course, is not a biological concept. The oxygen ‘pollution’ of photosynthesizers became the manna of aerobic lifeforms. The ‘pollution’ of your own butt can grow the plants you eat. Nature is a cycle, and one creature’s shit is another’s breakfast. Economics, however, is a closed system which does not acknowledge (or measure) the existence of nature at all. Both the amount of resources nature has and the amount of waste it can take are assumed to be infinite. The only limiting factor is, within macroeconomics, nothing. It’s all just disembodied numbers that can keep growing forever.

In conventional economics, it is just assumed that you can keep drawing resources forever and dumping them forever and thus grow forever. Does this make sense in physics? No, but economics both not integrated with any of the other sciences (because its assumptions aren’t even provable) and simply doesn’t give a shit. ‘Don’t you like iPhones?’ is the general answer to questions about growth, and as long as iPhones can be produced, this is satisfying. As Upton Sinclair said, “It is difficult to get a man to understand something, when his salary depends upon his not understanding it.” Such is with the global economy, where our salaries literally depend on not understanding that the whole thing is a planetary Ponzi scheme.

The planetary Ponzi proceeds by taking resources from millions of years ago and dumping the costs on creatures not yet born. This is done not so much out of malice as sheer ignorance. Economics has no concept of the environmental space it operates in, nor the geological time. Because this trick has worked for 400 years is convincing enough to anyone that looks at quarterly reports, but to anyone that can do math the situation is completely fucked. As the physicist Tom Murphy says, “Having witnessed a half-dozen rabbits come out of the hat in the example of lighting technology, we are conditioned to believe more are forthcoming. It will be true until it isn’t any more. One way to put it is that 6 rabbits does not imply an infinite number.” We are now at least six doubling cycles into the garbage measurement we call growth, and now the whole thing is going in the bin. Garbage in, garbage out, as the computer scientists say.

Waste Heat

GDP is also not just a measure of useful things, it’s increasingly a measure of useless profit. Effectively waste heat. As the second law of thermodynamics says: “Not all heat energy can be converted into work in a cyclic process.” In the same way, not all value goes to the worker, increasingly most of it goes to the capitalist. Nobody sells anything at ‘cost’, and the goal is actually to maximize the waste (profit). Given that everything requires energy to produce, this actually accelerates the heat death of the livable planet.

The problem of a population exhausting resources is wildly exacerbated by a few capitalists trying their damnedest to maximize the waste. The incentives of capitalism are wildly aligned with the living planet. They make GDP go up and crow about their own ‘innovativeness’ which is just innovation in bullshit. The resources come from the past and the costs are dumped in the future. All they ultimately produce is a bunch of hot air called profit, and still die in their god-measured years.

Wasted Energy

GDP is denominated as money, but what is money? Since the gold standard tarnished it’s assumed that money is created out of thin air (by fiat) but it’s not called the petrodollar for nothing. USD is a promise that you can get oil, generally at gunpoint. As Vaclav Smil says in the first line of Energy And Civilization: “Energy is the only universal currency: one of its many forms must be transformed to get anything done.” As he continues, “Only the inputs of fossil energies — directly as fuels and electricity, and indirectly in agricultural chemicals and machinery — could sustain both an expanding population and a higher per capita supply of food.” I would add is per capitalist greed, ie the waste heat above.

Whatever civilizational ‘progress’ that GDP measures, it’s all paid for by ancient sugar daddies. There is a huge (and magnificently dense) energy subsidy built into every single good and service we buy. The source of this growth is not mere human ingenuity, we have dug up millions of years worth of more intelligent lifeforms and used their ingenious harnessing of solar power as stored energy. What did we do with this solar inheritance? Blew it all in a few centuries.

The almighty dollar is really backed by finite fossil fuels, which really backs us into a corner. Cut off this subsidy and civilization as we know it crashes. Keep it plugged in and this civilization burns. So our proximate choices are crash and burn, or both, as we seem to be choosing. To switch to renewables A) doesn’t allow this civilization and B) at best buys you a few centuries of snorting some other resources before the chessboard problem spills us out the petri dish once again.

The fact is that GDP is effectively a proxy for fossil fueled growth, and if we keep growing, we’re fucked either way. If we replace fossil fuels to keep growing, then we’re just fucked in a million other ways. Climate collapse is just a symptom of seeing the world this way. An electric bulldozer still bulldozes the planet, however green the paint.

What Now?

What does this have to do with a Paati stitching the leg on a stuffed animal for a child? Nothing. I have no solution. The thread she used is probably made out of petroleum, what do I know about solutions? I’m just a particle in the stream. What does one do about this problem? I dunno. We’re in much bigger doo-doo than ‘one’ can undo.

One ‘lesson’ is that we already live most of our lives outside of capitalism and that we could contract the role of markets instead of putting our hospitals and schools and town square in them, but that’s just one point among trillions of dollars saying the opposite. That’s the best I can come up with, and it’s still a political solution to a philosophical problem. It’s still wildly inadequate, like bringing a knife to a gun fight.

The deep philosophical problem is the very idea of endless growth, but changing that is a whole-ass shift in consciousness, which is way above my pay grade. All I can do is my dharma, which seems to be complaining to a few people that already know.

As long as people measure GDP and don’t measure the living planet, we’ll get more of the former and less of the latter. As the old business school adage goes, ‘you get what you measure’. The corollary of that is that ‘you lose what you don’t measure,’ ie everything that which makes life worth living. In fact, as long as we require measurement and science to understand our place in the world, we’ll keep getting lost in abstractions and miss the point, which is spiritual. But who am I to tell you that? I’m here in front of a screen, pointedly not looking out the window or playing with my children.

From where I sit GDP has nothing to do with me. It’s something stupid and meaningless and frankly evil compared to my own life, let alone the living planet. My kids don’t understand it and the dogs don’t understand it and I think they’re on to something. We somehow believe that GDP is important cause we see it on TV, but it’s not. It’s just a made up number to glorify waste, and waste heat, and wasted energy.

GDP is bullshit, but to someone under the bull, this is a purely academic observation. You can’t get the bullshit back in the butt, nor can you immediately the bull off’a you, especially with so many hopes riding on it. The best you can hope for is to try again over the next few lifetimes, with the ruins of GDP as fertilizer.