In our fast-paced world, economic growth is often hailed as the ultimate measure of a nation’s success, the driver of prosperity. Yet beneath the opulence of rising GDP and increasing wealth lies one question: Is relentless economic growth always worth the consequences? Despite the undeniable benefits of economic progress, it fails to accurately measure well-being, primarily benefiting the wealthy and contributing to increasing ecological damage.

Economic growth is typically measured through gross domestic product or GDP. A country’s GDP is found by calculating the market value of the goods and services produced there. The metric has often been useful as countries industrialized, raising the value of production, and improving the general standard of living. However, the world is dominated by post-industrial societies like the United States, where the continued dominance of GDP in economic discourse is increasingly being called into question.

The issue of GDP as a proper metric stems from its reliance on market value, which does not actually encapsulate the welfare of all people. If public resources are privatized, market value increases by making essential goods inaccessible; in this case, does GDP truly reflect overall economic growth? The answer is a resounding no: focusing on a skyrocketing GDP leads to society turning a blind eye to the stagnating quality of life.

Moreover, GDP fails to take externalities such as inequality and environmental impact into account. Though it may account for the rise in corn production in the United States, it ignores how the use of pesticides and fertilizers leads to soil erosion and contamination—which should be considered when evaluating economic growth as it provides a more holistic view of the effects of rapid economic growth. Simply put, GDP provides no scope for malpractice in the production and distribution of goods.

A significant problem plaguing the U.S. is rising inequality and polarization, which continues despite significant GDP growth. It is an overwhelming indication that GDP fails as a holistic metric, unable to factor in the distribution of wealth in society. A clear example of this is the productivity-pay gap. Since the 1970s, worker productivity has increased significantly, allowing for greater growth in GDP. However, the wages of workers remain stagnant, signaling that workers have not received the benefit of continued growth in productivity and GDP. 

This problem has only intensified in recent years, especially since the COVID-19 pandemic. Since the pandemic, a net transfer of $50 trillion occurred from working-class Americans to the vastly wealthy. The transfer comes in the form of wages and benefits that would have otherwise been given to workers, but the exploitation of loopholes in the tax code allowed large corporations to escape payment.

Furthermore, high inflation coupled with high interest rates since the pandemic have suppressed the purchasing power of most Americans. This results from the fact that wages continue to grow at a slow pace that simply cannot compete with inflation. All of this occurs as the economy has continued to grow, suggesting that the correlation between economic growth and higher living standards obscures the actual nature of our economy: distribution of wealth.

Perhaps the most significant issue with America’s tunnel vision on economic growth is the ecological damage inherent in it. The overuse and exploitation of natural resources allow for greater productivity but contribute to long-term issues that far outweigh the so-called “economic” benefits.

The clear correlation between economic growth and environmental damage is shown by the global rise in CO2 emissions. Emissions grew to dangerously high levels following the end of WWII, when countries across the West dramatically expanded their economies with a disregard to the environment.

As public attention to the resulting environmental degradation grew, corporations began to outsource emissions to underdeveloped countries where environmental regulation was nonexistent while continuing to appropriate the wealth generated from production in such countries. In doing so, economic growth continued to increase even as the global environment worsened and climate change accelerated.

Ultimately, a myopic focus on market value often obscures the larger picture of the harm of production and distribution. Instead of focusing purely on economic growth, a broader view of the economy is necessary: one which not only takes into account economic production but also ensures the fruits of the economy are split fairly and the environment is protected.