Monday, December 31, 2012
Politicians gauge prosperity in Germany
Steady growth used to be the measure of prosperity, but entirely different things are important for people's contentment and satisfaction. Now, German parliamentarians are out to gauge true wealth.
In 2011, the German economy generated some 2.57 trillion euros ($3,32 trillion) in GDP, once again topping previous years - according to calculations by the Federal Statistical Office of Germany, based on figures compiled by German companies, chambers of commerce and trade associations.
German parliamentarians, however, began wondering what the bare numbers said about the true satisfaction and prosperity of German citizens. Two years ago, they decided that question had to be studied more closely. Polling institutes discovered through surveys that many in the general public felt that "those at the top had no idea" what they were concerned about and what hardships they had.
With the effects of the 2008 financial crisis still rippling across the world, and the gap between rich and poor continuing to grow, it's clear that something isn't right with the system.
Is growth at any cost a guarantee for future prosperity? Since last year, 34 German parliamentarians - women and men of every party and commissioned by parliament - have been addressing the issue.
Daniela Kolbe of the Social Democrats (SPD) and Matthias Zimmer of the Christian Democrats (CDU) lead the work group. Kolbe told Deutsche Welle that all politicians in the group, regardless of their political affiliation, agreed that growth alone did not reflect a society's true prosperity and contentment. A new index is now in the works for measuring that prosperity.
Happiness as a nation's gross domestic product?
Growth alone does not reflect prosperity, says Daniela Kolbe
The Buddhist Kingdom of Bhutan believes that prosperity should be measured by the happiness of its citizens. With a focus on its Gross National Happiness Index (GNH), the right to happiness is at the core of the nation's public policy. Germany may not follow suit completely, said Kolbe, but the hope is the country could learn something from nations, such as Ecuador, Bolivia and Great Britain. The British government, for instance, plumbs the mood of its population by way of a "happiness survey," attempting to reveal what makes people "rich and content."
The German parliamentary work group is also reviewing opinion polls among its own population. According to data analyzed by the German Institute for Economic Research (DIW), Germans list the following as ingredients for prosperity and contentment: health and health care, social contacts and participation in society, free and life-long education, and quality work and employment. In addition, people's lifestyles should be environmentally-friendly and sustainable enough to ensure that future generations will have a chance at prosperity.
"With regard to the environment, one sees that there's a price for some of the things one regards as signs of prosperity." But it is not Germans who are paying that price right now, Kolbe noted, but people in other parts of the globe, or people who have not yet been born.
Tightening belts as the goal?
When prosperity ends up not being defined by whether one owns the biggest and most expensive car, takes three vacations a year, or continually gets a raise, then politicians may be able to shape life in the future differently.
Members of the Commission on Growth, Prosperity and Quality of Life, as the work group is officially called in the German parliament, have already defined their first concrete goals: the economic system, particularly wage labor, should focus more on the needs of the people in future. That means, on the one hand, that people's work should be better appreciated and protected, while at the same time, it should not play such a central role in people's lives as it has up to now.
"We will not be able to abolish the hamster wheel, but it has to be possible that there are phases in which people work less, times in which people do further training or take care of their kids or aging parents," said Kolbe.
Financial excesses at citizens' expense should be avoided, the commission said. "We agree that more stringent regulations are necessary in financial markets," said Kolbe. Banks, for instance, should have greater capital resource requirements. But the commission, so far, has not been able to agree on just how important growth should be in the economy.
Part of that discussion also includes unconditional basic incomes and a more just distribution of income that would perhaps see a stricter tax system or greater interaction between unions and management.
The work group, at any rate, has discovered that an allegedly rich industrialized nation, like Germany, is actually home to only a scarce amount of contentment and prosperity. "Inconvenient questions pop up in the process," said Kolbe. When people talk about austerity, then the immediate question is how one advances economic growth and increases employment when there's a call for restricting consumption.
"Perhaps the whole system will have to be turned upside down," Kolbe reflected. For now, she'll wait for the results of the prosperity and contentment index, which are supposed to be announced in May, 2013, and discussed in parliament.