Wellbeing is so much more than GDP. But if that’s the case, a new approach is needed.

Britain, as a country, is richer than it has ever been. There are more people carrying iPhones, wearing designer clothes and filling their homes with more and more stuff. Delivery companies will bring you food within 30 minutes to meet those late-night cravings, next-day delivery will bring your packages from the latest retail therapy session directly to the door, and online retailers have everyone’s backs covered with a new outfit for Friday night’s party.

The trappings of modern life are marked by the ease with which we can get what we want — when we want. It is often said that today, is the best time in all of history to be alive. But if that’s the case, why is Kier Starmer talking about a shift away from a reliance on the very metric that enabled this so-called prosperity to happen? Why does he, as laid out in his party conference speech, want to match wellbeing’s importance to that of GDP for measuring our prosperity?


The ‘good life’

In much of the richer nations around the world, secularisation has become the norm. In place of religion, we have the GDP that has become our ideology for how to achieve the ‘good life’. Forget the Christian view that a closer relationship to God is a means to the best life, or the Buddhist tradition and its quest for enlightenment. Today’s faith is all about believing that increased economic activity will give us a better life through increased resources,  and therefore more choice in how we use them. However, the privileged position we grant GDP in our society requires us to understand the implications of our unlimited quest for more.

The power of growth

If we take a closer look at GDP and its impact on decisions that invariably impact our lives, the picture becomes clearer. The OECD’s description sums it up well: ‘if ever there was a controversial icon of the statistics world, GDP is it’. This is because all it measures is economic growth. Despite what many say, this is not the same as growing wellbeing or prosperity. GDP includes growth, even when what is growing is harmful to our long-term or even short-term prospects. It also disregards many important aspects of wellbeing such as social cohesion, work-life balance and environmental sustainability.

Economic growth has prompted a rise in the living standards of the average person in advanced economies. There is no question that this has made many people’s lives better. However, something has changed. While economic growth continues to increase, other indicators suggest that wellbeing and prosperity have become stagnant, and in some cases are even decreasing. The Gross Progress Indicator (GPI) measures the economy while taking into account both positive and negative effects, such as pollution or decreased crime rates. GPI suggests that progress has stopped improving in line with GDP in the 1970s and has now begun to decline.

A decline in wellbeing with a growing economy contradicts the central tenet of our modern ideology. It appears that growth can only improve wellbeing to a certain material level. Beyond that level of prosperity, according to this ideology, there is only hoarding of more and more stuff. This consequence reveals a fundamental misunderstanding of what it means to ‘prosper’ and carries its own dangers to our wellbeing.

Today we consume ever more aggressively and competitively. Our technology is made not to last but to be replaced and updated. New is always best. When it comes to status, this is assessed by the amount of stuff you have. If you lack the latest goods, you are not winning at the game of life.

‘Thrive or die is the maxim of the jungle’

The economy grows as we continue to accumulate more stuff around us and work harder and longer to keep it going. But this practice leads us to cut out much of what makes us happy. Longer hours result in less time for friends and family, and the fear of falling behind in the game of consumption leads to an ever greater need to consume. Is it any wonder that levels of loneliness and anxiety remain alarmingly high amongst young social media users and post-lockdowns? These factors merely exacerbated an already festering problem — the decline of wellbeing.

If we take another look at modern life, a darker picture emerges. Here, the new iPhone is not just a gateway to exploring the wonders of the internet or an efficient means of communication. It is a status symbol, plain and simple, which we need for a comfortable place in society. We are motivated, as Tim Jackson describes in his book Prosperity without Growth, by ‘the anxiety of the empty self … Thrive or die is the maxim of the jungle’. Growth and consumption are necessary for each other. As we anxiously scramble for more stuff, consumption increases and the economy continues to grow. We get richer, society appears healthy, the economy grows, and our collective anxiety grows with it.

Solutions to this problem are complicated. But potential alternatives do already exist. Other countries have started to take note of this issue. For instance, despite its status as a mid-income country, Costa Rica tops the list of countries with the highest wellbeing in the world — the UK is in 108th place. Notably, Costa Rica’s government focuses on preventative healthcare and prioritises social cohesion through peacebuilding on a small and large scale.

Our system is making us unhappy

The irony is that part of the very system we’ve built to make our lives better is now doing the opposite. We need reforms that protect the achievements of the current system but that also temper our mass consumption. Modifying how we think about wellbeing and what constitutes a good life is the logical next step. However, our government must play a large role in leading the change.

Starmer’s promise to match every pound spent to its impact on wellbeing is a step in the right direction in terms of the national debate. Still, more must be done to raise awareness of the dangers of unchecked mass consumption on our wellbeing. Thomas Jefferson once argued: ‘The care of human life and happiness, and not their destruction, is the first and only object of good government’. It is the duty of politicians to act in view of our wellbeing.

The answer to our long-term happiness is that less consumption could mean more prosperity. While a more frugal life may not appeal to all, it helps to remember that the word ‘frugal’ comes from the Latin word frux — meaning to bear fruit. Arguably, a simpler life could produce a more fruitful and fuller future.