Plus Other Needed Adjustments To National Economic Equations
Television footage from the early 1970s shows the first women elected to New Zealand’s Parliament as she was escorted with all due pomp and ceremony into the royal chamber. Some very attentive men joined an entire nation watching Marilyn Waring swear with uncommon vigor to serve her country and constituency.
She was 22.
More sheep farmer than the flower child many mistook her for, Waring’s short speech signaled to approving women across the land that their concerns would no longer be ignored. In this moment of emancipation, everything seemed possible.
Fast-forward two years. As head of the Public Expenditures committee, Waring found herself putting together the national budget. It was almost as if she was being guided. Running her finger down columns of figures measuring the nation’s transactions, she was surprised to find not a single line item for women’s work at home. It should have taken up pages of accounting. But New Zealand’s single biggest occupation wasn’t listed at all.
This is bizarre, Waring thought. As she pointed out to her male colleagues, no one puts in longer hours than women raising children. While “on call” to their round-the-clock needs, mothers acting as principle teacher, nurturer, nurse and lifeguard also attend to the most or all of the maintenance, accounts and logistics for households as complex as small businesses. Yet this huge labor sector is completely missing from the national budget.
No one could argue the facts. But sheep farming had taught Waring that when nature’s cooperative yin/yang survival strategy gets this far out of balance, any economic system that so thoroughly excludes the mothers on whom it depends must eventually collapse.
Along the way, she knew, the feminine side of human nature and entire populations invariably suffers the most. Sure enough, when she superimposed a graph showing a mother’s typical daily chores over a similar graph of a man working a salaried job, most of the empty “time off” blocks in the male chart were filled in on the mom’s.
When census takers finally tallied the toil of Aeotearoa’s huge lost tribe of unpaid women workers, they found that the hours put into raising children and managing household tasks exceeded the value of all mining in this Maori country by a multiple of three, and all manufacturing by 1000%. Across the Tasman Sea, based on equivalent wages for people paid to provide child and senior care, janitorial and maintenance work, taxi and delivery services, all this unpaid work was worth 571,000 full-time jobs in Australia alone.
Most North American households still cannot afford the cost of replacing a mother’s tasks with paid hands. Penney Kome, author of Somebody Has To Do It: Whose Work Is Housework? calls this “invisible national treasure” an “enormous pool of unpaid workers who can be forgotten when it’s time to draw up national policies such as childcare, elder care, health care, unemployment insurance, pensions, or social assistance.” [Ottawa Citizen May 9/97]
It was no coincidence that the first women in New Zealand’s parliament was the first to notice that women who often toiled like sharecroppers taking care of their families received almost nothing from governments busy shoveling public tax dollars into the maws of corporations that sponsored their elections, but paid little or no taxes themselves.
“The question arises,” said Waring, “which is the biggest industry? Which is the biggest productive and service sector…and why can’t those allowances be extended to that sector?”
FREE AT LAST
It wasn’t just women put at risk by a skewed economics that counts all monetary transactions as a “plus”, without ever debiting the downside. The young parliamentarian soon joined her neighbors in opposing a proposed a mountaintop mine that would have destroyed their centuries-old way of life by poisoning the abundant croplands below.
Their campaign was successful. And in 1975, Waring became an international celebrity after forcing a “non-confidence” vote against her own party for failing to uphold New Zealand’s status as a Nuclear Free Zone against visiting US warships. When Waring “crossed the floor” of parliament to join the opposition, Kiwis cheered, the government collapsed—and the bullying boats had to take their radioactive mischief elsewhere.
Why is it that peace has no market value, while the terrible waste and destruction of war drives the world’s biggest economies, Waring wondered? Surely, any national economy based on building and buying weapons can only lead to constant war.
On the other hand, how much is the serenity of not living near nuclear weapons or a nuclear reactor worth? How does the fluctuating “value” of digital dollars equate with happy children, abundant crops and undisturbed wildlife?
It doesn’t, she saw. A global accounting system that counts monetary exchange as the sole yardstick of “value” must be deeply flawed. The more she looked, the more it seemed to Waring that national accounting practices “had been co-opted by a pathological value system.” What else could you call a system that counts making, storing and using nuclear bombs as “good” for national and global economies?
Marilyn Waring traveled to more than 35 countries searching for a different budgetary model. Everywhere she went, she was startled to find that national budgets never accounted for women’s worth outside the paid workforce. Nor did their accounting practices ever consider many other values most people consider vitally important.
Where did the notion of “Gross National Product” come from? Waring wondered. And why are monetary transactions so universally applied as the sole measure of national worth in countries where relatively little cash changes hands?
The secret, someone told her, is that all UN member nations must use the same accounting procedures. This system of National Accounting was first set forth in the 1940s by two men as a way for Britain to pay for the Second World War. They had no idea that their short-term economic equations would become the price of UN admission for member states that today governs the lives of nearly everyone on Earth.
On learning that the only set of National Accounting available for public purview is kept at the UN, Marilyn Waring flew to New York, where she spent weeks poring over this arcane accounting lore. The more she read, the more she was appalled.
Said to be “Applicable to economies around the world,” formulas that were nothing of the sort simply ignored such key cultural and economic contributions as small scale farming, and women’s unpaid work. Waring concluded that the worldwide economic system was rigged against nearly everyone who participated in it.
She started asking how such disastrous distortions could override national sovereignty and self-determination to favor a few rich folks over seven billion other wild and human lives? And how is it, she wondered, that a woman hired for housekeeping counts as a contributor to the GNP—but if she marries her employer and continues doing the same work without pay, her labor is seen as a “loss” by the same system of measurement?
None of the economists she talked to had ever heard of National Accounting.
The enthusiastic participation of the International Monetary Fund and the World Bank in this global “pyramid scheme” raised another flag. As Kome pointed out, most projects implemented by those organizations “have tended to overlook women’s struggles to feed and support their families. Instead, foreign agencies consulted with the local men, and imposed expensive and ill-fated projects, directed at bringing developing nations into the monetary economy. Somehow the profit never seemed to stay in the community.”
Because subsistence agriculture is specifically excluded from their calculations, Kome continued, “IMF and World Bank projects often evict mothers and their families from small patches of arable land—where they are, at least, reasonably well nourished—to create huge plantations with cash crops. The nation’s GDP flourishes, but the local children go hungry.” [Ottawa Citizen May 9/97]
The world’s accounting system is all wrong, Waring revealed to audiences attracted by her insights, because “national accounting only recognizes currency changing hands.” Raising children, growing food, supporting partners, protecting the environment on which all depend—these and many related activities are accorded no value at all unless money is involved.
For this Kiwi sheep farmer, it all came down to a fundamental question about what we really cherish. “Ask people what they value most in life, they will say my children, my partner, my health, my religion,” she told an interviewer. “Usually, it’s something that can’t be bought.”
But the economists she talked to seemed to be coming from other planets, considering their profound ignorance of the one they were actually on. Perfecting “the art of the dumb question,” Waring kept asking them to translate their jargon into recognizable English that made some practical sense.
The learned ones patiently explained that her concerns were irrelevant. Filling the air with poison gases, lacing food and water with pesticides, stripping the planet’s solar radiation shielding, and hastening climate collapse are all “externalities” that can be ignored they said. Until people get sick. Or start dying. That’s always counted as a plus, because money invariably changes hands.
“Is any activity that make the Gross National Product (GNP) of countries go up, considered good?” Waring asked.
“Absolutely,” replied academics poring over abstractions that had little to do with real lives. “Money paid for goods and services always adds to the economy,” they chanted.
“But what about the Exxon Valdez oil spill that devastated Alaska wildlife and shorelines?” Waring wanted to know. Very profitable, she was told, with millions of cleanup and salvage dollars pumped into corporate coffers and the local economy.
“What about the white slave trade in Eastern Europe, the sex industry in Indonesia and Thailand, prostitution in central and eastern Europe?” she asked. These activities, too, are “an important part of the Gross National Product in those countries.”
Deeply troubled by these revelations, Waring returned to farming after her term in office. She also took the time to earn a PhD in political economy, before returning in 1988 to rock the mostly male world of economics with a book on all those missing women.
Counting for Nothing: What Men Value And What Women Are Worth was an eye-opening exposé of women’s productive and reproductive work missing from the National Accounting of more than 140 nations.
It received some serious attention. John Kenneth Galbraith praised her contribution as an overdue antidote to badly flawed assumptions. Gloria Steinem called Waring “a populist and an excellent explainer [who] puts human beings and human values into economics.”
For example, everyone talks about the importance of “community”, Waring liked to say. But community “is usually mom or daughter or aunty or neighbor or some other woman who already works 16 to 18 hours a day.”
Waring thought that if she and her cohorts “could demonstrate overwhelmingly that women’s unpaid household work could be defined as servitude,” then the countries that stood for human rights—places like Canada, New Zealand, Australia and Scandinavia—would be in breach of their fundamental obligations and “would have to start practicing what they were legally bound to do.”
She was right. In 1993 the system of National Accounting were expanded to include all of women’s subsistence agriculture, including activities such as carrying water and collecting fuel wood.
Four years later, Saskatchewan homemaker Carol Lees gave this process another shove when she refused to fill out her census form. Lees told the media she was willing to risk jail rather than list her many work hours at home as “zero” just because she wasn’t being paid for them. She had a point. The UN had just found that women do two-thirds of the world’s work, while receiving less than 5% of its income, and owning less than 1% of all assets. The United Nations further calculated that if women’s work were counted worldwide, their unpaid labor would be worth $11 trillion a year. [Ottawa Citizen May 9/97]
Mothers Are Women teamed up with Lees to win three new questions about caregiving hours in the next Canadian census. But Statistics Canada already knew that unpaid women were doing work equivalent to more than third of the country’s GNP.
1997 turned out to be a banner year for women. A “Platform for Action” adopted at a World Conference on Women in Beijing enjoined governments to start counting women’s unremunerated work. Caregiving for dependents and elderly family members, subsistence farming, and women’s self-employment or small businesses were to be included in these reckonings. [Ottawa Citizen May 9/97]
Seven countries did just that.
On the other side of the globe, Hazel Henderson was also looking at an economic system blind to billions of women workers. A self-described “housewife” in New York City, Henderson found a new calling after leading a successful campaign to enact groundbreaking air pollution laws during the 1960s. Like Waring, she would soon became a frequent consultant to governments, as well as an international speaker on a “new economics” that was newly inclusive.
“I realize that I’m operating in a patriarchy, but then every other country in the world is a patriarchy,” Henderson told Wired’s Kevin Kelly. “The UN is the biggest patriarchy of all. I feel like Virginia Woolf. I have no country. I’m a woman. I have no country. That means my country is my planet,” [Wired Feb/97]
Describing her mission as “just to weigh in on the side of life in human evolution—that’s all,” Hazel Henderson proposed to the first Earth Summit that economists go back and take all the important courses they’d missed—subjects like “ecology, cultural anthropology, social psychology, thermodynamics, and every other discipline concerned with human development.”
Calling such a broadened economic perspective “the politics of reconceptualization,” Henderson described a more harmonious economic vision in her books, Politics of the Solar Age and Building A Win-Win World.
Was anybody listening? Opinion-shaping “news” anchors kept reciting government and corporate press releases, cheering each upsurge in consumer spending without ever mentioning the toll all this extra consumption, debt and pollution is placing on this wounded world—and generations of finned, feathered, furred and two-leggeds to come.
But then, denial is the strongest human propensity.
“For us to maintain our way of living, we must tell lies to each other and especially to ourselves,” lawyer and lecturer Bill Reese pointed out. “The lies are necessary because, without them, the truth would stop us from doing stupid things. Economic growth is one of those stupid things, because if we really thought about its impact, we would have to change our entire worldview.”
After all, “Money is not wealth,” Hazel Henderson kept insisting. “I have been going around these past twenty years giving thousands of speeches about how ridiculous it is to measure a country’s progress using GNP. I always like to compare it to flying a Boeing 747 with nothing on the instrument panel except an oil pressure gauge.” [Sustainability Spring 1990]
For a more accurate measure of planetary progress, she suggested, “Newscasters and policy-makers should look to the Genuine Progress Indicator to provide a more balanced measure of the economy.”
Unlike GNP, the GPI assigns value to leisure time, unpaid housework and volunteerism. Genuine Progress indicators also subtract crime and family breakdown, resource depletion, traffic accidents, and other social debits counted as “pluses” in the global system of National Accounting.
“The GPI recognizes the importance families, communities and nature play in economic well-being,” Henderson told her audiences. “Under the current national accounts system, these factors are ignored.” [adbusters.org]
Next to the faulty GNP gauge and a wildly spinning compass, a dozen “Quality of Life” instruments Hazel Henderson helped duct-tape to our spaceship’s instrument panel can help us gauge how well we’re really doing with regard to what matters most.
How does your neighborhood and nation measure up in terms of:
Income distribution: Is the poverty gap widening or narrowing?
Social and environmental costs: Depletion of nonrenewable resources.
Ratio of energy input for goods produced: Measures efficiency and recycling.
Military/civilian budget ratio: Effectiveness of government/diplomatic skills.
Education: Literacy levels, school dropout and repetition rates.
Health: Infant mortality, birth weights, weight/height/age ratio.
Nutrition, shelter, availability and costs of medical care.
Basic services: water purity, sanitation, telephones, electrification.
Political participation and democratic process.
Status of minority and ethnic populations and women.
Water, soil and food qualities, air pollution in urban areas.
Environmental depletion: Hectares of agricultural lands and forests lost annually.
Bio-diversity and species loss.
While Marilyn Waring was rousing people Down Under, Hazel Henderson went to work with Germany’s Green Party, and Soviet economists at the USSR Academy of Sciences to pitch the adoption of a new “national report card” that would enable real comparisons between nations “based on genuine progress and genuinely sustainable development.” [Whole Earth Review Fall/95]
The idea took hold in South America, where Henderson next joined a group of experts from five continents in advising Venezuelan President Perez on an economic framework that looked at new ways of measuring development. At a meeting of non-aligned nations, 15 countries—Algeria, Argentina, Brazil, Egypt, India, Indonesia, Jamaica, Malaysia, Mexico, Nigeria, Peru, Senegal, Venezuela, Yugoslavia, and Zimbabwe—formally accepted the new Quality of Life guidelines, creating their own economic summit for the southern hemisphere.
The “G-15” will first meet in Kuala Lumpur for the June 2005 South Economic Summit. The G-15 represents 30% of the world’s population; the G-7 13%.
FULL COST PRICING
Here was real progress. But the overdeveloped nations in the North remain in urgent need of a similar overhaul never mentioned on the nightly news.
“You cannot have a system where a few people are accumulating an enormous amount of material wealth and power and still have an ecologically sane and peaceful society,” Henderson points out today. Especially when most of the destructive accoutrements of our fast-paced high-tech lifestyles—are not being charged at their full health and maintenance costs. [Red Herring Apr/98]
The solution, say new economists like Waring and Henderson, is to move immediately to “full cost pricing” that accurately transfers the costs of producing, using and recycling products onto the balance sheets of producers and buyers. Once gasoline is priced at its true “cost” at the pumps, for example, a wheezing planet might have a chance to catch her breath.
When we insist on full-cost pricing, and turn away from warehouses jammed with products so cheap they can only be made in child sweatshops and forced labor camps, we will begin to see more durable and efficiently made goods that benefit everyone involved. We will also experience “a greatly enhanced quality of life” as the pace of our pathologies slows down, Hazel Henderson believes.
Until then, she plans to stay busy “designing new cultural DNA and splicing it into cultural codes, as well as identifying malfunctioning DNA strands, such as GNP, which generate pathological patterns in the body politic.”
THE NEW WORLD ORDER IS US
With the entire planet creaking under the press of populations striving for survival and more stuff, we are at a bifurcation point, Henderson believes. “We need to pull back and take a wide shot and see what the whole thing looks like.”
Bifurcation occurs when whatever comes afterwards radically diverges from what came before A sharp turn away from monetary exchange is already seeing countries and corporations using computer networks to swap billions of dollars of services and goods—without exchanging a single dollar, dinar or dinero.
This is huge, Henderson says. This changes every economic equation.
“When you tell economists we are going to a new system that doesn’t use money, they get very upset,” she laughs. But bartering over electronic trading systems is already weakening the money monopoly, she points out. Local currencies are also springing up everywhere, “raising consciousness, building community, and restructuring our economies in a sustainable direction.” [Red Herring Apr/98]
Ignored by a $24 trillion global economy that is largely a digital mirage, today’s “hidden economy” is forging ahead, Henderson says, with person-to-person barter, reciprocity, sharing and cooperation carrying out an estimated $16 trillion worth of trades every year –without exchanging a single cent. [Wired Feb/97]
Now add another annual $12 trillion or so of uncounted women’s work, and the picture that emerges is quite unlike the economic picture lauded on the virtual “news”.
Which is more real to you? Which would you rather support? And what does it all mean? As Hazel Henderson says, “Things are getting a lot better and a lot worse, at the same time.”
And the things that really matter aren’t for sale at all.
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MARILYN WARING AUDIO
MARILYN WARING TALK (Transcript)