Post on 27-Dec-2015
Measuring Genuine Well-being: The Genuine Progress Indicator
System of Sustainable Well-being Accounts for Alberta
Atkinson Foundation MeetingToronto
October 1, 2001
Mark Anielski, Director, Sustainability Measurement, Pembina Institute
Senior Fellow, Redefining Progress, Oakland CA
“The welfare of a nation can scarcely be inferred
from a measurement of national income as defined by the GDP…goals for ‘more’ growth should specify of what
and for what”
Simon Küznets
Pembina Institute
“The Gross National Product includes air pollution and advertising for cigarettes, and ambulance to clear our highways of carnage. It counts special locks for our doors, and jails for the people who break them. GNP includes the destruction of the redwoods and the death of Lake Superior. It grows with the production of napalm and missiles and nuclear warheads. And if GNP includes all this, there is much that it does not comprehend. It does not allow for the health of our families, the quality of their education, or the joy of their play. It is indifferent to the decency of our factories and the safety of our streets alike. It does not include the beauty of our poetry or the strength of our marriages, or the intelligence of our public debate or the integrity of our public officials. GNP measures neither our wit nor our courage, neither our wisdom nor our learning, neither our compassion nor our devotion to our country. It measures everything, in short, except that which makes life worthwhile.”
Robert F. KennedyMarch 18, 1968
Redefining Economics
Economics
Oiko nomikus
Household Management
sustainable “living capital” stewardship
Wealth (Capital)
Weal th
Well-Being Condition of
U.S. GPI.. declining economic welfare
$-
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995
US
$ p
er c
apit
a, 1
992
chai
ned
do
llars
Source: Data derived from spreadsheets from the U.S. Genuine Progress Indicator (GPI) for 1999. Redefining Progress, Oakland, CA. www.rprogress.org
U.S. GDP per capita
U.S. GPI per capita
U.S. …making money, growing poor
U.S. Debt, Stock Markets, Economic Growth (GDP) vs. Genuine Progress Indicator (GPI) and Environmental Depreciation
(in current US $)
(4,000)
1,000
6,000
11,000
16,000
21,000
26,000
1950
1952
1954
1956
1958
1960
1962
1964
1966
1968
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
$ b
illio
ns
US
(cu
rren
t d
olla
rs)
U.S. Stock Market Capitalization Value(NYSE/ASE/NASDQ)
Total US Debt
Currency Govenrment Notes
U.S. GDP
U.S. Genuine Progress Indicator (GPI)
Value of Environmental Degradation &Resource Depletion
U.S. vs. Canada GPI per capita
5,000
5,500
6,000
6,500
7,000
7,500
8,000
8,500
9,000
9,500
10,000
U.S
. GP
I pe
r ca
pita
(19
92 U
S d
olla
rs)
5000
6000
7000
8000
9000
10000
11000
Can
ada
GP
I pe
r ca
pita
(19
86 C
dn. d
olla
rs)
US Per Capita GPI US $ 1992 constant Canada Per Capita GPI Cdn. $ 1986 constant
US GPI
Canada's GPI
Canada….better economic well-being?
Societal and Personal
Well-Being
EconomicWell-Being
GenuineProgress IndicatorsAccount
EnvironmentalWell-Being
Genuine Progress Indicators (GPI) Sustainable Well-being Accounting System
Spiritual Well-Being
Quality of LifeValues
Key determinants of well-being
Quality of life needs and prioritiesbased on citizen input and dialogue
CPRN’s Quality of LifeDialogue with Canadians
51 Indicators of Well-being
Social Accounts
-Human Capital-Social Capital
EconomicAccounts
- Economic Output - Produced Capital- Financial Capital
GenuineProgress Indicator Account
EnvironmentalAccounts
-Natural Capital- Ecosystem Services
Full Cost & Benefit Accounts ($$)
Condition of Well-Being Accounts
(qualitative/quantitative)
GPI Sustainable IncomeStatement
GPI Balance Sheet
(GPI) Sustainable Well-being Accounting System:GPI Accounts
Elements of Well-being
SocietalSocietalWell-BeingWell-Being
AccountAccount
EconomicEconomicWell-BeingWell-Being
AccountAccount
EnvironmentalEnvironmentalWell-BeingWell-Being
AccountAccount•Economic Growth•Economic Diversity•Trade•Disposable Income•Personal Expenditures•Taxes•Debt•Savings Rate•Household Infrastructure•Public Infrastructure•Income Inequality
•Poverty•Paid Work Time•Unemployment•Underemployment•Parenting and Eldercare•Leisure Time•Volunteerism•Commuting Time•Family Breakdown•Crime•Democracy•Intellectual Capital•Life Expectancy•Infant Mortality•Premature Mortality•Disease•Obesity•Suicide•Substance Abuse•Auto Crashes•Gambling
•Ecological Footprint•Ecosystem Health•Carbon Budget•Energy Efficiency•Oil and Gas Reserve Life•Agriculture Sustainability• Timber Sustainability•Wetlands-Peatlands•Fish & Wildlife•Air Quality•Water Quality•Toxic Waste•Landfill Waste
Regrettable Societal Costs and Benefits **• Value of housework• Value of parenting and eldercare• Value of volunteer work• Value of free time• Cost of unemployment and
underemployment• Cost of auto crashes• Cost of commuting• Cost of crime• Cost of family breakdown• Cost of suicide• Cost of gambling• Cost of obesity and unhealthy lifestyles• Cost of gambling• “Cost” of income inequality (GDP
adjusted by the Gini coefficient for income inequality)
Societal Well-being Indicators Account
Societal and Personal
Well-Being Account
EconomicWell-being
Account
GenuineProgress
Indicators
EnvironmentalWell-being
Account
Societal and Personal Well-being Indicators
• Poverty (% living below LICO and a Living Wage);
• Income distribution (Gini coefficient)
• Unemployment rate• Underemployment rate• Paid work (time use)• Household work (time use)• Parenting and eldercare (time use)• Free (leisure) time• Volunteer time• Commuting time• Life expectancy• Premature mortality• Infant mortality• Obesity• Suicide• Youth drug use• Auto crashes• Divorce and family breakdown• Crime• Problem gambling• Voter participation• Educational attainment
* Indicators are expressed in non-monetary units or normalized qualitative indices.
** All values are expressed in monetary units which can be used to generate the GPI Net Sustainable Income statement adjusting GDP for unaccounted benefits and costs.
Regrettable Environmental and Natural Capital Depreciation Costs**
• Cost of public and private environmental clean-up
• Cost of toxic waste management• Cost of household/business waste
management and pollution control costs
• Deprecation cost of nonrenewable resource use
• Cost of long-term environmental damage from fossil fuel use
• Cost of unsustainable forest resource use
• Cost of loss of farmland• Cost of loss of wetlands and
peatlands• Cost of loss of wildlife and
fisheries• Cost of loss of ecosystem services• Cost of air pollution• Cost of water pollution
Environmental Well-being Accounts
SocietalSocietalWell-beingWell-being
AccountAccount
EnvironmentalWell-being
Account
Environmental Well-being Indicators*
• Conventional crude oil and natural gas reserve life
• Oilsands reserve life• Energy use• Agriculture sustainability
(composite index)• Timber sustainability index• Forest fragmentation• Parks and wilderness• Fish and wildlife population
health• Wetlands• Peatland• Water quality• Air quality• Greenhouse gas emissions• Carbon budget deficit• Hazardous waste• Landfill waste• Ecological footprint
** All values are expressed in monetary units which can be used to generate the GPI Net Sustainable Income statement adjusting GDP for unaccounted benefits and costs.
* Indicators are expressed in non-monetary Units or normalized qualitative indices.
EconomicEconomicWell-beingWell-being
AccountAccount
Genuine Progress Indicators
Full costs and benefits of economic output, produced, and financial capital
• Gross Domestic Product (GDP)
• Personal Consumption Expenditures (PCE)
• PCE adjusted for income inequality/distribution (“cost” of inequality)
• Non-defensive government expenditures
• Value of services of consumer durables
• Cost of consumer durables (regrettable depreciation)
• Value of public infrastructure services
• Net capital investment• Cost of household and
personal debt servicing• (see also, Societal costs)
Economic Well-being Accounts
SocietalSocietalWell-beingWell-being
AccountAccount
Economic-Well-being
Account
Economic Well-being Indicators
• Economic growth (real GDP per capita)
• Economic diversity (distribution of GDP by sector)
• Trade balance (exports less imports)
• Real disposable income• Real weekly wages• Personal consumption
expenditures• Transportation expenditures• Taxes (real $ per capita)• Household and personal debt
per capita• Savings rate• Public infrastructure (value
of services)• Household infrastructure
(value of services)
EnvironmentalEnvironmentalWell-beingWell-being
AccountAccount
GenuineProgress Indicators
* Indicators are expressed in non-monetary units or normalized qualitative indices.
** All values are expressed in monetary units which can be used to generate the GPI Net Sustainable Income statement adjusting GDP for unaccounted benefits and costs.
-
10
20
30
40
50
60
70
80
90
100Economic growth
Economic diversityTradeDisposable income
Weekly wage rate
Personal expenditures
Transportation expenditures
Taxes
Savings rate
Household debt
Public infrastructure
Household infrastructure
Poverty
Income distribution
Unemployment
Underemployment
Paid work time
Household work
Parenting and eldercare
Free time
Volunteerism
Commuting time
Life expectancyPremature mortality
Infant mortalityObesitySuicideDrug use (youth)Auto crashes
Family breakdown
Crime
Problem gambling
Voter participation
Educational attainment
Oil and gas reserve life
Oilsands reserve life
Energy use
Agricultural sustainability
Timber sustainability
Forest fragmentation
Parks and wilderness
Fish and wildlife
Wetlands
Peatlands
Water quality
Air quality
GHG emissions
Carbon budget deficitHazardous waste
Landfill wasteEcological footprint
A Portrait of Alberta’s Condition of Well-being (GPI Balance Sheet) Diagnosis 1999
-
10
20
30
40
50
60
70
80
90
100Economic growth
Economic diversity
Trade
Disposable income
Weekly wage rate
Personal expenditures
Transportation expenditures
Taxes
Savings rate
Household debt
Public infrastructure
Household infrastructure
-
10
20
30
40
50
60
70
80
90
100Poverty
Income distribution
Unemployment
Underemployment
Paid work time
Household work
Parenting and eldercare
Free time
Volunteerism
Commuting time
Life expectancy
Premature mortality
Infant mortality
Obesity
Suicide
Drug use (youth)
Auto crashes
Family breakdown
Crime
Problem gambling
Voter participation
Educational attainment
-
10
20
30
40
50
60
70
80
90
100Oil and gas reserve life
Oilsands reserve life
Energy use
Agricultural sustainability
Timber sustainability
Forest fragmentation
Parks and wilderness
Fish and wildlife
Wetlands Peatlands
Water quality
Air quality
GHG emissions
Carbon budget deficit
Hazardous waste
Landfill waste
Ecological footprint
EnvironmentalWell-being Conditions
Societal and Personal Health
Conditions
EconomicWell-being Conditions
Alberta’s Condition of Well-being Diagnosis for 1999:The GPI Sustainability Circle Index
-
10
20
30
40
50
60
70
80
90
100Economic growth
Economic diversityTradeDisposable income
Weekly wage rate
Personal expenditures
Transportation expenditures
Taxes
Savings rate
Household debt
Public infrastructure
Household infrastructure
Poverty
Income distribution
Unemployment
Underemployment
Paid work time
Household work
Parenting and eldercare
Free time
Volunteerism
Commuting time
Life expectancyPremature mortality
Infant mortalityObesitySuicideDrug use (youth)Auto crashes
Family breakdown
Crime
Problem gambling
Voter participation
Educational attainment
Oil and gas reserve life
Oilsands reserve life
Energy use
Agricultural sustainability
Timber sustainability
Forest fragmentation
Parks and wilderness
Fish and wildlife
Wetlands
Peatlands
Water quality
Air quality
GHG emissions
Carbon budget deficitHazardous waste
Landfill wasteEcological footprint
Historical Portraits of Well-being
-
10.00
20.00
30.00
40.00
50.00
60.00
70.00
80.00
90.00
100.00
Economic growthEconomic diversityTrade
Disposable incomeWeekly wage rate
Personal expenditures
Transportation expenditures
Taxes
Savings rate
Household debt
Public infrastructure
Household infrastructure
Poverty
Income distribution
Unemployment
Underemployment
Paid work time
Household work
Parenting and eldercare
Free time
Volunteerism
Commuting time
Life expectancyPremature mortality
Infant mortalityObesitySuicideDrug use (youth)Auto crashes
Family breakdown
Crime
Problem gambling
Voter participation
Educational attainment
Oil and gas reserve life
Oilsands reserve life
Energy use
Agricultural sustainability
Timber sustainability
Forest fragmentation
Parks and wilderness
Fish and wildlife
Wetlands
Peatlands
Water quality
Air quality
GHG emissions
Carbon budget deficitHazardous waste
Landfill wasteEcological footprint
Note: 51 of 51 indicators
-
10.00
20.00
30.00
40.00
50.00
60.00
70.00
80.00
90.00
100.00Economic growth
Disposable incomeWeekly wage rate
Personal expenditures
Transportation expenditures
Taxes
Savings rate
Household debt
Public infrastructure
Household infrastructure
Poverty
Income distribution
Unemployment
Underemployment
Paid work time
Household work
Parenting and eldercare
Free time
VolunteerismCommuting time
Life expectancyPremature mortality
SuicideAuto crashes
Family breakdown
Crime
Problem gambling
Voter participation
Educational attainment
Oil and gas reserve life
Oilsands reserve life
Energy use
Agricultural sustainability
Timber sustainability
Forest fragmentation
Fish and wildlife
Wetlands
Peatlands
Air quality
GHG emissionsCarbon budget deficit
Ecological footprint
Note: 42 of 51 indicators
-
10
20
30
40
50
60
70
80
90
100Economic growth
Economic diversityTradeDisposable income
Weekly wage rate
Personal expenditures
Transportation expenditures
Taxes
Savings rate
Household debt
Public infrastructure
Household infrastructure
Poverty
Income distribution
Unemployment
Underemployment
Paid work time
Household work
Parenting and eldercare
Free time
Volunteerism
Commuting time
Life expectancyPremature mortality
Infant mortalityObesitySuicideDrug use (youth)Auto crashes
Family breakdown
Crime
Problem gambling
Voter participation
Educational attainment
Oil and gas reserve life
Oilsands reserve life
Energy use
Agricultural sustainability
Timber sustainability
Forest fragmentation
Parks and wilderness
Fish and wildlife
Wetlands
Peatlands
Water quality
Air quality
GHG emissions
Carbon budget deficitHazardous waste
Landfill wasteEcological footprint
1999
1961
1998
The best
The worst
Alberta Economic Growth vs. Genuine Progress Index
-
10
20
30
40
50
60
70
80
90
100Economic growth
Economic diversityTradeDisposable income
Weekly wage rate
Personal expenditures
Transportation expenditures
Taxes
Savings rate
Household debt
Public infrastructure
Household infrastructure
Poverty
Income distribution
Unemployment
Underemployment
Paid work time
Household work
Parenting and eldercare
Free time
Volunteerism
Commuting time
Life expectancyPremature mortality
Infant mortalityObesitySuicideDrug use (youth)Auto crashes
Family breakdown
Crime
Problem gambling
Voter participation
Educational attainment
Oil and gas reserve life
Oilsands reserve life
Energy use
Agricultural sustainability
Timber sustainability
Forest fragmentation
Parks and wilderness
Fish and wildlife
Wetlands
Peatlands
Water quality
Air quality
GHG emissions
Carbon budget deficitHazardous waste
Landfill wasteEcological footprint
40.0
50.0
60.0
70.0
80.0
90.0
100.0
1961 1966 1971 1976 1981 1986 1991 1996
Ind
ex
(wh
ere
10
0=
be
st)
GDP Growth IndexBest year: 1999
Worst year: 1961
GPI Well-Being IndexBest year: 1961
Worst year: 1998
Source: Alberta GPI Accounts 1961-1999
1999
The GPI Sustainable Income statementGDP – personal consumption expenditures
• adjust for income inequality+ value of unpaid work (housework, parenting, volunteerism)+ value of the household and public infrastructure- cost of household debt servicing - value of the loss of human and social capital:
- loss of leisure time- cost of underemployment and unemployment- cost of divorce, suicide, auto crashes, divorce, gambling
-value of natural capital depreciation: - nonrenewable natural capital (minerals, oil, gas, coal)- unsustainable renewable natural capital (forests, agriculture)
-cost of loss of ecosystem services:- (carbon sequestration, air pollution,water pollution, forests, wetlands, and peatlands)
= Net Sustainable Income (output)
Alberta GDP versus Sustainable Economic Welfare
-1,500
3,500
8,500
13,500
18,500
23,500
28,500
33,500
38,500
1961 1966 1971 1976 1981 1986 1991 1996
1998
dol
lars
per
cap
ita
Alberta GDP
Alberta GPI(net sustainable income)
Source: Alberta GPI Accounts, GPI income statements, 1961-1999
1999
Pembina Institute
Total environmental costs and natural capital depreciation is
estimated at $26.4 billion (1998$) or 24.0% of Alberta’s
GDP.
The value of unpaid work is estimated at $38.8 billion
(1998$) or 35.4% of Alberta’s GDP in 1999.
The social and human capital costs are estimated at $23.4 billion (1998$) or 21.3% of
Alberta’s GDP.
Pictures at the Exhibition:The Story of Alberta’s Well-
being and Sustainability
The Cost of House-hold Debt in Alberta: What is included? The cost of household debt servic-
ing is based on an estimate of the interest payments on chartered bank consumer loans.
We estimate the cost of household debt servicing in 1999 at $6.6 billion on roughly $64 billion (1998$) in total outstanding household debt. This expenditure is roughly 6% of Alberta’s 1999 GDP.
Financial debt burdens individuals, households, students, businesses, farmers, and government. Debt financing fuels economic growth, investment and consumption by households, business and even governments. Genuine progress is made if the levels of debt do not become excessive in relation to disposable income and spending power. At the household and personal level, debt is soaring even as the
Alberta Government eliminates its debt. For our analysis, we used Statistics Canada data for personal and household debt at the national level and estimated Albertans’ share of this debt. Our analysis shows that household debt rose from $5,204 per Albertan (1998$) in 1961 to $21,172 (1998$) in 1999—a 307% increase. Real disposable income increased only 113% over the same period. The average
household debt per Albertan has increased from 57% to 109% of real disposable income from 1961 to 1999. When we add Albertans’ share of outstanding federal government debt, Alberta Government Debt, municipal government debt, and business debt, the average total debt per Albertan in 1999 was $60,441 (1998$), or 322% of average real disposable income.
$-
$5,000
$10,000
$15,000
$20,000
$25,000
1961 1966 1971 1976 1981 1986 1991 1996
1998
$ pe
r ca
pita
Source: Debt figures estimated for Alberta from Statistics Canada, Table 378-0003 , National balance sheet, credit market summary; Expenditures and Disposable Income figures from Alberta Economic Accounts 1999
Household Debt
Disposable Income
Personal ConsumptionExpenditures
Debt in Alberta: How Much? Noteworthy: Real household debt per cap-
ita grew by 3.8% per annum from 1961 to 1999, surpassing the 2.1% per annum growth in real disposable income and the 2.2% per annum growth in real GDP per capita.
Albertans are financially stressed with 23% reporting in a 1999 national survey that they would not have enough savings to last one month.
We estimate the total of all debt (household, business, farm, and all government) per Albertan in 1999 at $60,441 (1998$); it has increased 355% since 1961, which represents 163% of GDP .
While real per capita house-hold debt grew at a rate of 11.3% per annum, real dispos-able income only grew at 2.1% per annum.
Alberta Household Debt vs. Disposable Income and Consumption Spending
Household Debt
-
20
40
60
80
100Economic growth
Economic diversity
Trade
Disposable income
Weekly wage rate
Personal expenditures
Transportation expenditures
Taxes
Savings rate
Household debt
Public infrastructure
Household infrastructure
Indicator # 10, HOUSEHOLD DEBT
-
10
20
30
40
50
60
70
80
90
100
1961 1966 1971 1976 1981 1986 1991 1996
GD
P In
de
x, b
en
chm
ark
ye
ar
=1
00
-
10
20
30
40
50
60
70
80
90
100
De
bt I
nd
ex,
be
nch
ma
rk y
ea
r =
10
0
Economic Growth
Debt
Less Debt
More Debt
Pembina Institute for Appropriate Development, January 2001
So What? The GDP counts expenditures on debt servicing as additions to economic growth. In most cases, debt is a regrettable financial burden that diminishes the economic well-being of households, businesses and governments. The figure at the upper right shows that while GDP (as an index) continues to rise, the amount of household indebtedness (as an index) is also increasing. Do increasing levels of financial debt feed economic growth? Economists such as Herman Daly have identified that a basic growth bias is built into the economy by the nature of our debt-based money creation system, with total debt growing forever and being fundamentally unrepayable from current earnings. Since money creation (through debt) is a synthetic process that encourages making money from money, there is a fundamental need to address the long-term costs of this system to genuine well-being and sustained stewardship of “living” capital. The GPI accounts identify debt as detracting from genuine well-being. The figure at the lower right shows the real costs per capita of household debt servicing compared to real disposable income. Average real costs of household debt servicing in 1999 are estimated at $6.5 billion or $2,145 per Albertan (1998$). Total real debt servicing increased 330% from 1961 to 1999 while real disposable income per capita only rose 113% over the same period. Government debt servicing detracts from economic well-being by diverting monies that could have been spent on public programs and services to enhance well-being. For example, roughly 29 cents on every tax dollar paid to the federal government in 1999 went to service the federal debt. Genuine progress will be made when a) we begin to explore alternative money systems to replace fractional reserve banking and a debt-based money system, and b) we perhaps adopt a total capital and GPI system of well-being accounts that informs and guides national monetary policy and money creation.
Costs of Household Debt Servicing vs. Disposable Income, Alberta 1961-1999
$179.2Billion
Including household, farm, Alberta Government, and municipal government debt, as well as business debt in Alberta, and Alberta’s share of federal government debt, the total debt bill for 1999 was $179.2 billion (1998$). As an index, household (personal debt) per capita in Alberta in 1999 scored 24.6 on a scale of 0 to 100, where 100 is the lowest level of real household debt per capita that occurred between 1961 and 1999.
Alberta Debt Index: Where are we today?
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
1961 1966 1971 1976 1981 1986 1991 1996
Hou
seho
ld d
eb s
ervi
cing
cos
ts, 1
998
$ pe
r ca
pita
$-
$5,000
$10,000
$15,000
$20,000
$25,000
Rea
l dis
posa
ble
inco
me
per
capi
ta, 1
998
$
Source: Debt servicing costs were estimated by the authors using the average consumer loan rate of Chartered Banks applied to total personal and household debt estimates for Alberta (based on Statistics Canada national data; Table 378-0003: National balance sheet, credit market summary.
Household debt servicing costs per capita, 1998 dollars
Per capita real disposable income
ENVIRONMENTAL WELL-BEING Genuine Progress Indicators (GPI)
GPI Condition
Index in 1999 (100 = best) (0 = worst)
Best Year Worst Year
*
Trend 1961-1999
Description of Trend
Conventional crude oil and natural gas reserve life
20 1966 1999*
Natural gas and conventional crude oil reserves continue to decline with replacements not keeping pace with extraction.
Oilsands reserve life 79 1979 1998*
Oilsands reserves are relatively constant given that there an estimated 300 billion barrels of economic reserves of oil that could last hundreds of years.
Energy use 44 1962 1999*
Total energy demand (intensity of use) continues to rise at a rate of 2.2% per annum, per capita, similar to the GDP per capita.
Agriculture sustainability
62 1999 1961*
The agriculture sustainability index (a composite index of yields, soil organic carbon, summer fallow, pesticide use and salinity) has increased somewhat in the 1980s and 90s. However, increasing farm debt, and fertilizer and pesticide use may become problematic.
Timber sustainability
79 1994 1998*
The Timber Sustainability Index (ratio of timber growth to all timber capital depletions) continues to decline falling below sustainable thresholds in 1998 and 1999.
Forest fragmentation 11 1961 1999*
The fragmentation of Alberta’s forests (due to industrial development) has risen so dramatically since the 60s that an estimated 90% of Alberta’s vast productive forest land base is now fragmented.
Parks and wilderness 33 1999 1995*
While the area of parks and wilderness under protection has increased slightly, not all landscape types are adequately represented.
Fish and wildlife 45 1980 1999*
Caribou populations are falling; grizzly bear populations are uncertain, and sport and commercial fishing are declining.
Wetlands 40 1961 1999*
Area of wetlands has declined at an estimated 0.6% per year since 1961.
Peatland 99 1961 1999*
The area and volume of peatland is largely unchanged.
Water quality
73 1999 1986*
Overall water quality (a composite index of pulp effluent, sewage treatment, water-related illness and river water quality) has improved. However, river water quality shows a slight decline and groundwater conditions are uncertain.
Condition of Well-being Report
GDP grows but to whose benefit?
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
1961 1966 1971 1976 1981 1986 1991 1996
GD
P P
er
Ca
pita
(1
99
8$
)
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
Pe
rso
na
l Dis
po
sab
le I
nco
me
Pe
r C
ap
ita (
19
98
$)
Economic growth
Disposable income
Despite increasing economic growth since
1981, average real disposable incomes have stagnated since
peaking in 1981.
In a 1999 national survey, 23% of Albertans (highest in Canada)
said they would not have enough savings to sustain themselves beyond one month’s salary.
(Source: Canadian Council on Social Development)
Economic well-being at risk?
Pembina Institute
(200)
4,800
9,800
14,800
19,800
24,800
1960 1965 1970 1975 1980 1985 1990 1995
1998
dol
lars
per
Alb
erta
n
Taxes on persons
Sources: Alberta Treasury, Alberta Economic Accounts 1999; Statistics Canada, CANSIM Table 384-0035 and Table 384-0012 (92-99)
Savings
Personal and household debt
Disposable income
Personal consumptionexpenditures
1999
Another day older….
Pembina Institute
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
1961 1966 1971 1976 1981 1986 1991 1996
GD
P P
er
Ca
pita
(1
99
8$
)
-
1,000.00
2,000.00
3,000.00
4,000.00
5,000.00
6,000.00
7,000.00
Pre
ma
ture
Mo
rta
lity
Economic growth
Premature mortality
Premature mortality from all causes has been declining steadily since 1980; the average life expectancy of Albertans (men and women) has
increased more than 7 years from 72.0 years in 1961 to 79.3 years in 1999.
…. and deeper in debt
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
1961 1966 1971 1976 1981 1986 1991 1996
GD
P P
er
Ca
pita
(1
99
8$
)
(5,000)
5,000
15,000
25,000
35,000
45,000
55,000
De
bt
pe
r C
ap
ita (
19
98
$)
Economic growth
Household debt
Household debt servicing costs now exceed real disposable income for the first time in history. The average household debt per Albertan has almost doubled in 40 years from 57% of real disposable
income in 1961 to 109% in 1999
Pembina Institute
While real per capita household debt grew at a rate of 11.3% per annum, real disposable income grew by only 2.1%
per annum (1961-1999).
More GDP…more poverty?
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
1961 1966 1971 1976 1981 1986 1991 1996
GD
P P
er C
apita
(19
98$)
-
5
10
15
20
25
30
Pov
erty
(%
of
all p
erso
ns li
ving
bel
ow t
he lo
w in
com
e cu
t-of
f)
Economic Growth
Poverty
Pembina Institute
Between 1961 and 1999, the level of poverty (LICO)
increased 37.1%; Alberta had Canada’s
third lowest poverty rate
We estimated roughly 20% of Albertans used the provinces 74 food
banks; 17.2% of households are estimated to live below a living wage
($24,332 per annum for family of four).
3.00
5.00
7.00
9.00
11.00
13.00
15.00
1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
Rat
io o
f to
p 20
% o
f in
com
e gr
oup
to lo
wes
t 20
%
Source: Statistics Canada, "Income Inequality within provinces", Dimitri Sanga, Perspectives, Winter 2000, Catalogue No. 75-001-XPE, Table, p. 35
Market income inequality
Total income inequality(after Government transfers)
After-tax incomeinequality
GROWING GAP: Gap Between Alberta’s Rich (Top Income Quintile) and the Poor (Lowest Income Quintile) Comparing Incomes on a Before Government Transfers,
After Taxes, and Total Income Basis, 1981 to 1998
Hourly Income Comparisons, Alberta, 1998
$125.00
$70.42
$5.90
$6.16
$1,822.92
$7.75
$16.15
$23.48
$63.33
$7.60
$14.20
$17.19
$58.33
$52.34
$25.86
$448.96
$185.26
$123.96
$33,307.29
$- $5,000.00 $10,000.00 $15,000.00 $20,000.00 $25,000.00 $30,000.00 $35,000.00
Richest 8 Albertans (Average)
Average Salary of Top 100 Canadian CEOs
Average CEO Salary
Mary Cameron, President, Alberta WCB
Top Federal Government Bureaucrat
Sheila Weatherill, President, Capital Health Authority
Top Provincial Deputy Ministers
Premier Ralph Klein
Calgary Mayor Al Duerr
Edmonton Mayor Bill Smith
Teachers (Edmonton Public Schools)
Registered Nurses
Federal Public Servant
Average Canadian Worker
Average Personal Income of Albertans
Youth (15-24) Median Wage Earner
Poverty/Living Wage
Welfare Single Mom with two children
Minimum wage earner
Source: 2. "Who's worth what, Who's Paid What, Where the Money Goes", Special Report, National Post, April 22, 2000; Alberta Public Accounts 1999-2000
The top 20% income group of Albertans earned 14.5 times more than the lowest 20% almost double the ratio of 8.2 in
1980.
The eight wealthiest Albertans earned an estimated 5,645 times more per hour than an Albertan working full-time at
the minimum wage.
Jubilee?
Less time with the kids but more GDP
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
1961 1966 1971 1976 1981 1986 1991 1996
GD
P P
er
Ca
pita
(1
99
8$
)
-
20
40
60
80
100
120
140
160
180
200
Pa
ren
ting
an
d E
lde
rca
re (
ho
urs
pe
r p
ers
on
15
ye
ars
an
d o
ver
pe
r ye
ar)
Economic growth
Parenting and eldercare
The value of unpaid work in Alberta in 1999is estimated at $38.8 billion (1998$) or 35.4%of Alberta’s GDP.
Nearly 70% of full-time employed, married mothers feel rushed and stressed on a daily
basis
More divorces add to GDP growth
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
1961 1966 1971 1976 1981 1986 1991 1996
GD
P P
er
Ca
pita
(1
99
8$
)
-5%
5%
15%
25%
35%
45%
55%
Fa
mily
Bre
akd
ow
n (
% o
f m
arr
iag
es
tha
t e
nd
in d
ivo
rce
)
Economic growth
Family breakdown
Source: Statistics Canada, CANSIM special retrieval and Alberta Economic Accounts 1999
The estimated cost of divorce and familybreakdown in Alberta in 1999is estimated to contribute $148 million(1998$)to Alberta’s economic growth.
The rate of divorce rose 4.6% per annum
compared to real GDP growth of 4.4% per year, 1961 to 1999
Rising suicide adds to the GDP
$-
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
$40,000
1961 1966 1971 1976 1981 1986 1991 1996
GD
P p
er
cap
ita
(19
98
$)
-
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
Su
icid
e r
ate
pe
r 1
00
,00
0
GDP at market prices, expenditurebased (1998$ per capita)
Suicide rate for both sexes per100,000 population
Pembina Institute
Suicide is the leading cause of death amongst Calgary males aged 10-
49 years.
Health of democracy?
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
1961 1966 1971 1976 1981 1986 1991 1996
GD
P P
er
Ca
pita
(1
99
8$
)
-
10
20
30
40
50
60
70
80
90
100
De
mo
cra
cy
(vo
ter
pa
rtic
ipa
tion
%)
Economic growth
Voter participation
Pembina Institute
Growing Ecological Deficits…
Pembina Institute
Alberta has the fourth largest ecological footprint in the world after the United Arab Emirates, Singapore and the United States of America.
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
1961 1966 1971 1976 1981 1986 1991 1996
GD
P P
er
Ca
pita
(1
99
8$
)
0.0
2.0
4.0
6.0
8.0
10.0
12.0
Eco
log
ica
l Fo
otp
rint
(he
cta
res
pe
r ca
pita
)
Economic growth
Ecological footprint
Alberta’s Footprint, fourth largest in the world….5 times the global ecological carrying capacity
Pembina Institute
0
1
2
3
4
5
6
7
8
9
10
11
12
13
% of global population
[ha/
cap
ita]
1.8 (per capita global biocapacity)
2.8 (per capita ecological footprint)
10% 54% 10% 3% 11% 3% 2% 5%0.8 ha
1.4 ha
2.5 ha
3.6 ha
5.2 ha
6.3 ha
7.4 ha
11.9 ha
Alberta10.7 ha
Global Biological Capacity
Depleting oil and gas capital…more GDP
$-
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
$40,000
1961 1966 1971 1976 1981 1986 1991 1996
GD
P p
er
cap
ita(
19
98
$)
0
5
10
15
20
25
30
35
40
45
Cru
de
Oil
an
d N
atu
ral G
as
Re
serv
e L
ife (
yea
rs r
em
ain
ing
)
GDP at market prices, expenditurebased (1998$ per capita)
Crude Oil and Natural Gas ReserveLife Average
There are less than 10 years of natural gasreserves remaining, based on current production and stocks. However, Alberta has more oil in the oil sands than Saudi Arabia’s official reserves, more than 300 years of production.
The estimated cost of depreciation of nonrenewable resources is estimated at $10.6 billion in 1999 or 9.7% of GDP.
Depleting timber capital…more GDP
$-
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
$40,000
1961 1966 1971 1976 1981 1986 1991 1996
GD
P p
er
cap
ita (
19
98
$)
-
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
Tim
be
r S
ust
ain
ab
ility
In
de
x (r
atio
of
gro
wth
to
de
ple
tion
s)
GDP at market prices, expenditurebased (1998$ per capita)
Timber Sustainability Index, the ratioof annual increment (growth) dividedby total harvest, energy andagriculture depletions
More than 90% of Alberta’s forests are fragmented
Growing Carbon budget deficit…more GDP
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
1961 1966 1971 1976 1981 1986 1991 1996
GD
P P
er
Ca
pita
(1
99
8$
)
-
1
2
3
4
5
Ca
rbo
n B
ud
ge
t
Economic growth
Carbon budget deficit
Pembina Institute
The estimated cost of Alberta’s carbon emissions to global warming in 1999 are estimated at $4.1 billion (1998$) or 3.7% of Alberta’s GDP.
Carbon budget deficit
Carbon budget surplus
Water quality improving but is it sustainable?
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
1961 1966 1971 1976 1981 1986 1991 1996
GD
P P
er
Ca
pita
(1
99
8$
)
-
10
20
30
40
50
60
70
80
90
100
Wa
ter
Qu
alit
y In
de
x
Economic growth
Water quality
While surface (river) water quality has improved very little is known about the long-term sustainability of Alberta’s groundwater aquifers.
Next Steps….GPI Sustainability Accounting and Reporting
National GPI
Provincial/State GPI
Local GPI
Corporate GPIGlobal Reporting Initiative (GRI)
Quality of Life Indicators
GPI Accounts forOntario, Quebec, B.C., AlbertaMaritimes
National GPI Accounts:Canada, U.S.
Alberta GPI Balance Sheet (1960-2000)(physical and monetary stock accounts)
Pembina Institute
For additional information:
www.pembina.org
marka@pembina.org