GDP? It’s so gross!
Nishikant quoted Simon Kuznets, the Nobel-winning economist who had set the standard for assessing national income, as saying so
- Published 3.12.19, 2:11 AM
- Updated 3.12.19, 2:11 AM
- a min read
BJP parliamentarian Nishikant Dubey on Monday told the Lok Sabha that it was not right to treat the gross domestic product (GDP) as “a Bible, Ramayana or Mahabharata”.
Nishikant quoted Simon Kuznets, the Nobel-winning economist who had set the standard for assessing national income, as saying so.
Although it could not be established whether Kuznets’s choice of words was as hallowed as that of Dubey, the economist had indeed written that “the welfare of a nation can scarcely be inferred from a measure of national income”.
But the MP forgot that it was Prime Minister Narendra Modi who had made the five-year goal of a $5-trillion economy the holy grail of his government. The amount the Prime Minister had mentioned was nothing but the GDP at current prices.
Economists had already underlined that turning India into a $5-trillion economy need not transform the country into a developed nation. Former RBI governor C. Rangarajan recently said that even if India achieved the $5-trillion goal, the per capita income would still be only $3,600, far below the $12,000 needed to become a developed nation.
Besides, with the economy in the doldrums, the Modi government has been citing the very GDP growth rate to claim that India is among the fastest-growing economies. Whether Dubey tried to enlighten the Prime Minister on the irrelevance of the GDP is not known.
Dubey, an MP from Jharkhand, delivered the economic sermon at a time the growth rate is dipping. If the follies of the GDP are being enumerated now, you don’t need a Nobel in economics to diagnose a case of sour grapes.
Dubey did not stop at Kuznets. “In future, there will not be much use of the GDP…. American President Kennedy said in 1968, ‘(The) GDP has no worth in the world.’ I’m reading Kennedy’s March 18, 1968, statement: ‘Our gross national product counts air pollution and cigarette advertising and ambulances to clear highways of carnage…. It measures neither our wit nor our courage, neither our wisdom nor our learning.’ This is what Kennedy said about the GDP.”
When Opposition members pointed out that Kennedy had died in 1963, Nishikant said he had meant Robert F. Kennedy. Told that Robert Kennedy had never been President, Nishikant said he had been a presidential candidate and had headed a GDP committee in the US.