If your house burns down, the costs involved in rebuilding it boost GDP, but you wouldn’t call it a positive experience.

The same is true, on a larger scale, of disasters, both natural and manmade. Plenty of economic activity follows, but we’d rather it didn’t.

Still, the gross domestic product increases. And we’re told that’s a good indicator of growth and progress. Clearly, that’s not the whole picture, however, as studies about wellbeing and happiness demonstrate.

Such studies uncover troubling truths about the connection between our well-being and the economy, and beg the question: Are our governments truly responding to the needs and values of everyday Canadians? Clearly not.

Reports from the Canadian Index of Wellbeing compiled at the University of Waterloo have found a growing gap, noting that in the 20-year period between 1994 and 2014, for instance, GDP grew by 38 per cent but our wellbeing rose by just 9.9 per cent.

Despite years of prosperity, our economic growth has not translated into similarly significant gains in our overall quality of life. Even more concerning is the considerable backslide Canadians have experienced since the Great Recession of 2008.

“When Canadians go to bed at night, they are not worried about GDP. They are worried about stringing together enough hours of part-time jobs, rising tuition fees, and affordable housing. They are thinking about the last time they got together with friends or the next time they can take a vacation. Maybe that’s why we are getting less sleep than 21 years ago,” the CIW national report notes.

Such findings jibe with the likes of the Gallup survey of happiness and wellbeing, the latest of which found anger, stress, worry and sadness reached record highs in 2021.

Unhappiness has been increasing globally for a decade, according to Gallup, which notes the trend has been missed by almost every world leader. That’s because while leaders pay close attention to measures like GDP or unemployment, almost none of them track their citizens’ wellbeing.

The implications of this blind spot are significant and far-reaching, says Gallup, noting leaders missed the citizen unhappiness that triggered events ranging from the Arab uprisings to Brexit to the election of Donald Trump.

“We conventionally use GDP and other material measures to evaluate how nations are doing. But these are often deeply flawed measures of how actual people are experiencing their lives,” writes New York Times columnist David Brooks in a recent column looking at wellbeing issues.

“Misery influences politics. James Carville famously said, ‘It’s the economy, stupid.’ But that’s too narrow. Often it’s human flourishing, stupid, including community cohesion, a sense of being respected, social connection. George Ward of the Massachusetts Institute of Technology has argued that subjective measures of wellbeing are more predictive of some election outcomes than economic measures. Measures of wellbeing dropped in Tunisia and Egypt before the Arab uprisings. Wellbeing dropped in Britain before the Brexit vote. Counties in the United States that saw the largest gain in voting Republican for president between the 2012 election and Donald Trump’s election in 2016 were also the counties where people rated their lives the worst.”

Studies increasingly find that rising GDP doesn’t necessarily correlate with a better quality of life. Of course, GDP was not intended to be a measure of well-being. It doesn’t pick up on issues that are vitally important to the quality of our lives such as a clean environment, social cohesion or even how happy people are. It is not in itself a sufficient guide for modern policy making that covers social and environmental objectives. This becomes a problem when GDP is used as a yardstick for progress.

GDP is the best known macro-economic measure of the performance of the market economy of a nation. Although by design and purpose it is not a welfare measure, it has also come to be regarded as a proxy indicator for overall development and progress in general. GDP does not, however, measure environmental sustainability or social inclusion, and we’re coming to realize those limitations need to be taken into account if our economies are going to be organized to benefit the many instead of the few.

Being a monetary value measure, GDP therefore represents the part of the population’s well-being that comes from consumption of goods and services sold on established markets, but we know now – or should know – that there’s more to a good society than is captured in that measure.

Even people who don’t bother with the numbers know how they feel about the conditions under which they live. And they’re generally less happy.

Those findings are in keeping with a growing number of reports showing an erosion of our standard of living due to a longstanding attack on the middle class. The words fairness and equality are no longer applicable to what we consider the Canadian way of life.

Such feelings are in fact a global phenomenon, as seen in the Gallup survey that covers some 140 countries.

“Gallup asks people in this survey to rate their lives on a scale from zero to 10, with zero meaning you’re living your worst possible life and 10 meaning you’re living your best. Sixteen years ago, only 1.6 per cent of people worldwide rated their life as a zero. As of last year, the share of people reporting the worst possible lives has more than quadrupled. The unhappiest people are even unhappier. In 2006, the bottom fifth of the population gave themselves an average score of 2.5. Fifteen years later, that average score in the bottom quintile had dropped to 1.2,” says Brooks in his piece.

If misery levels keep rising, we can expect more civil unrest and associated populism, in the most negative way, he notes. Brooks points to the fact that the Global Peace Index shows that civic discontent –  riots, strikes, anti-government demonstrations – increased by 244 per cent from 2011 to 2019.

“We live in a world of widening emotional inequality. The top 20 per cent of the world is experiencing the highest level of happiness and well-being since Gallup began measuring these things. The bottom 20 per cent is experiencing the worst. It’s a fundamentally unjust and unstable situation. The emotional health of the world is shattering.”