Your Teacher Said What?! by Joe Kernen

calculate GDP three different ways, each of which is supposed to add up to the same number and occasionally even does. The first one is a simple measure of the total output of every business, assembled by surveying; the second is the amount spent on that output; 8 and the third is the total value of all producers’ incomes. Getting there means measuring national consumption, investment, government spending, exports, capital formation . . . You get the idea.
    However the calculation is performed, the idea behind GDP is to measure a country’s economic activity rather than its welfare or standard of living. This is, I guess, the reason that Progressives are so unhappy with it, and especially with the notion that more GDP is better than less GDP. It’s so unsatisfactory for the stuff that really matters to the Progressive mind—things like environmental damage or sustainability or disparities between rich and poor—that inventing alternatives to GDP has become a growth industry all its own.
    The Kingdom of Bhutan, for example, located north of India, has led the way in calculating something called GNH, gross national happiness, which surveys, among other things, how many antidepressants are prescribed annually (bad) or the percentage of voters participating in local democracy (good). Then there’s the GPI, genuine progress indicator, a creation of the United Nations System of National Accounts, which records such measures as the loss of farmland or degree of noise pollution (both bad). Then there’s the Happy Planet Index, which ranks countries on a scale of something called happy life years and places the Dominican Republic and Cuba far above Switzerland and Italy.
    If these seem a little squishy to you, well, they do to me, too. GDP isn’t a perfect measure of anything, but it has two pretty large virtues that make it superior to any of the competing measures—yes, even the Happy Planet Index.
    The first of those virtues is that no one rigs GDP measurements so that a particular group’s ideas about “the good life” are given extra points; though most of the games played with calculating living standards are intended to serve a Progressive agenda—happy life years include measures for (I swear) “Discrimination of Women,” “Brotherhood,” “Tolerance,” and “Social Justice”—it would be just as dishonest to rank countries by the number of hours the average person spends in prayer.
    The second virtue is that GDP—especially per capita GDP, which is the total of goods and services produced by the average person in a particular country—unlike its competitors, actually is correlated with pretty much every aspect of human welfare that we can measure, including life span, infant mortality, and literacy.
    Oh, there’s a third reason to like GDP as a measure of national economic performance: It makes Progressives apoplectic.
    Gold. Noun. Chemical element Au, atomic number 79. Also the precious metal used to back currency anywhere that has used the gold standard.
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    â€œDad?”
    â€œYes, Blake?”
    â€œWhy do all these commercials want to buy your gold?”
    â€œBecause they think they can make more money when they sell it.”
    â€œBut isn’t gold a kind of money?
    â€œNot anymore.”
    â€œDidn’t it used to be?”
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    Using a given sum of a precious metal as a way of calculating the economic value of a currency is thousands of years old. In its original form, the money in circulation actually was gold (or, more frequently, silver) but even paper currency, for most of its history, has been exchangeable for gold at a fixed price.
    That all changed, like so much else, with the Great Depression . Through the first years of the Depression, the Federal Reserve still paid for dollars with gold, but after the banking panics of the era reminded every depositor that it might be a good idea to