by Steven Giallelis

A Story of Wants:

To those who don’t have much knowledge or experience in the field, hearing the word “economics” or “economy” may bring shivers down their backs at the mere thought of mathematic calculations. Even more so, such terms beyond use in conversation may not be truly understood. Many may find themselves asking, what is an economy for anyway?

Fortunately, Dr. Yannick Beaudoin, the current Director General for Ontario and Northern Canada within the David Suzuki Foundation, answered this question at the Canadiana Gallery located in the University of Toronto, Munk School of Global Affairs and Public Policy. 

Dr. Beaudoin began his talk with attendees establishing the differences between the two words “economics” and “economy.” He defined economics as the ways we think of an economy, essentially, the rules of the game. An economy goes beyond this and can be interpreted as a social construct, being transactional and even transformational and has existed since the dawn of human civilization. 

In modern times, however, Dr. Beaudoin described how society has shifted from economies focused on needs, to those on wants. From such wants exists a disregard for consequence and results in a significant amount of waste produced internationally. The recent conflict between Canada and the Philippines regarding waste disposal can certainly attest to this notion. 

As Western society has become taught that so-called “happiness” can be bought through materialistic gain, from an economic perspective, there certainly is some good to be seen through this. However, does good through financial gain outweigh the associated costs? Dr. Beaudoin suggested that while we certainly can negotiate social issues and even to degree economics, we cannot negotiate with the planet. Unfortunately, the latter is what mainly bears the consequence of societal material demands. 

What happens when we prioritize wants without bearing in mind the consequences? A rapid increase in waste and the degradation of our surrounding environment, otherwise known as climate change. Among prevailing economic thought, Dr. Beaudoin highlighted the fact that we have developed and relied upon a system that fails to recognize the environmental consequences of Western materialistic “happiness”.  

The History of International Trade and GDP:

Providing a brief timeline and history of the emergence of traditional economic ways of thought, Dr. Beaudoin explained how upon the end of World War II, nations united to prevent the occurrence of another war. Upon this meeting, known as the Breton Woods Conference, it was decided that the more countries traded resources and services with one another, the less likely were the chances of another world war. Dr. Beaudoin identifies the desire for prolonged peace as the driving factor for such agreements and the establishment of well-known entities such as the World Trade Organization (WTO), the World Bank, and the International Monetary Fund (IMF). All of which were done in the time span of three weeks.

From this, Dr. Beaudoin described the emergence of hyper-consumerism throughout the 1950s as continuous growth by firms through factors of productions became the predominant economic rule internationally. Even more so, in addition to the development of major international entities, Dr. Beaudoin highlighted another prominent component of traditional economics: Gross Domestic Product (GDP). Despite its ripe age of merely 80 years, GDP posits a strong obsession with governments and individuals across the globe. But regardless of its popularity, Dr. Beaudoin emphasized that GDP cannot possibly demonstrate how well an individual being is doing nor a country for that matter.

GDP’s inception, too, was during the World War II by the Allies, specifically by Simon Kuznets. Dr. Beaudoin outlined how GDP was used as a powerful tool to demonstrate where the biggest factors of production were throughout the war for necessary supplies. Although GDP was certainly efficient throughout wartimes, even Kuznets himself provided a warning stating that it should not be used as an indication for wellbeing within a nation.

However, despite this warning by GDP’s creator, the economic tool is not only utilized for this exact purpose but has been added to throughout modern-day technologies and products. Dr. Beaudoin compared this to using old computer software and attempting to run new applications on it. 

Economics and Wellbeing:

Much like old computer software, GDP has its shortfalls. Specifically, it only considers aspects that can be monetized. But what then about things that can’t? For example, how would GDP put a price on clean air, water supplies and other vital components to life? Can we run these new applications on our old computer software, or will the program likely crash? 

Dr. Beaudoin strongly asserted that if we continue to prioritize “wants” and its accompanying waste, there will be no climate. Without a sustainable environment, there certainly cannot be a sustainable economy. While emphasis has been placed on traditional conceptions of economics, like all social sciences, there are plenty of others, including those that take into account environmental considerations. 

While the transition to more nuanced forms of economics can’t happen overnight and will likely face resistance, Dr. Beaudoin closed his talk with one final note. It only took three weeks to come up with the system in which the entire world currently presides, and the current wellbeing tool is only 80 years old. So, what type of economics do you want to support?  

Steven Giallelis is currently in his first year as a Master of Public Policy student at the Munk School of Global Affairs and Public Policy. He previously graduated from Ryerson University with an honours Bachelor of Arts in Criminology and Law. His policy interests include justice, immigration, environment, and labour policy.