MONTPELIER — Gross Domestic Product, that age-old economic indicator, fails to fully capture the health of the Vermont economy, argues Washington County Democratic Sen. Anthony Pollina.
That’s why he’s pushing for a “Genuine Progress Indicator,” a proposed tool that he said would paint a more accurate picture of the economy and how Vermonters are faring.
Pollina plans to introduce a bill during the next legislative session that would create a GPI based largely on the model already in use in the state of Maryland.
“The ultimate goal is to recognize that we are going through some of the most significant economic changes in our lifetime, in decades,” said Pollina. “We’re seeing the middle class vanishing, essentially, and the wealth gap increasing. We’re seeing some major changes in the economy and need a way to measure those changes in a way that measures them accurately.”
The GDP is far from accurate in terms of giving a complete view of the economy, Pollina said.
He said the GDP rose in Louisiana after Hurricane Katrina because the damage created jobs. That calculation ignored the human and environmental devastation, he said.
The GDP is “like a business that looks at gross income but never subtracts costs,” Pollina said.
Vermont was ranked 10th for GDP growth last year compared to other states. Vermont’s GDP rose 3.2 percent to $25.6 billion in 2010.
But Pollina isn’t convinced the seemingly rosy news that Vermont grew more than most other states captures how Vermonters are doing.
Pollina envisions a Vermont GPI that factors in information about wages, underemployment, the disparity between rich and poor Vermonters, and the environment to assess how the state is doing.
By measuring these facets of life, Pollina said, Vermonters will be able to measure how well state policy makers are doing their jobs.
“The other thing that goes along with measuring these things is it allows us to hold policy makers — of which I am one — more accountable for how we are doing in addressing these other economic indicators,” Pollina said.
Pollina said it would cost little to establish the system. Maryland spent about $20,000 to get its GPI up and running, he said.
Gov. Peter Shumlin is interested in the Genuine Progress Indicator, according to a spokeswoman, and has asked for more information about it.