This work is a substantial update of the final chapter in the first edition of Carbonomics no.1. It is divided into two parts. Part one points out the failings of conventional economic theories and details the inadequacies of economic measures such as gross national product. It exposes the futility of attempts to incorporate environmental and social factors into gross national product. It then highlights the inadequacies of the alternative theories for evaluating environmental and social factors. Part two summarizes the advantages, and limitations, of a global Carbon audit as a means of measuring geophysiological and human activities. As far as is known Carbonomics is the first theory capable of measuring both human and geophysiological factors.

Over the last couple of centuries two types of economic theory have been developed; those in which economic values are relative, and those in which there is an absolute value which supposedly calibrates all other economic values. The former are liberal, whilst the latter tend to be marxist. Neither of these two types of economic theories take into account any environmental, ecological, or geophysiological, factors. The adverse effects of economic activities on the Earth’s geophysiology are totally ignored - unless they have economic consequences. These economic theories are anthropocentric and ecocidal. Those promoting such theories are intellectually off their planet.

To a capitalist economist, the Earth does not exist; only the market is real. The fact that capitalist economists have not incorporated the Earth's life support system into their economic theories is not so much one of the most profound failures of modern intellectual life as a powerful revelation of the extent to which they are little more than intellectual prostitutes working for the favours of the rich and powerful who are destroying the Earth’s life sustaining processes. Economists, whether in universities, national banking institutions, the media, or global development institutions such as the world bank, do not take the Earth into account because Earth-rapists pay them not to do so. In other words, capitalist economists are gigolos whose primary skill is presenting capitalist propaganda as the truth.

To marxist economists the Earth does not exist. Only labour creates values so the Earth has value only in so far as it is chewed over by humans. Marx believed labour power was an absolute value which could be used as a yardstick to measure fluctuating values in the market place. But the labour theory of value is fundamentally wrong since it is based on the assumption that the more work that labourers put into destroying the Earth the greater the economic value they create. Marx’s labourers don’t live on a Planet any more than overpaid, over privileged, overeducated, capitalist economists. They all live on a non-existent Planet in a continually expanding universe.

Gross domestic product (gdp) is a measure of a country’s annual output of goods and services. Economic growth is the difference between the output of goods and services in the current financial year as compared to the previous year. Around the world, gdp is regarded as the best measure of a country’s economic growth. It is only one of many economic measures of a country’s economic status but, over the last few decades, it has become the main criterion for determining a country’s position in the world’s league table of wealthy countries. There are a number of criticisms of gdp: firstly, its use as the basis for grandiose claims for measuring non-economic activities; secondly, its inability to measure anything but the exchange of money; thirdly, its various anomalies; and, finally, that gdp is just a reflection of the capitalism system in which it is used. The difficulties involved in collecting statistics to measure gdp are of no concern in this work.

Over the last few decades capitalist economists have tried to convert gdp into a much more grandiose theory. Ludicrous claims have been put forward that gdp measures not merely annual industrial output and economic growth but national wealth, or long term prosperity, quality of life, standard of living, progress, technological/military prowess, human welfare, personal happiness, total pleasure, etc. Gdp is a measure of a country’s production of goods and services, it does not measure anything else. Thus, for example, it measures the provision of health services not the state of people’s health; it measures the provision of services to make people happy but it does not measure people’s happiness, etc. In this regard statistics would be all too entitled to mutter under their breath, "There are fibs, lies, and damn humans’. The following sections explore some of the grandiose claims made for gdp.

Gdp does not measure the distribution of wealth in a country i.e. who produces goods and services and who consumes them. It is perfectly possible for a country to produce a huge number of goods, and thus have a high gdp, even though 90% of its people are starving. If a country exports a substantial proportion of its output and a tiny elite expropriates the profits, then statistically the country would be counted as wealthy despite pervasive poverty. For example, "After 1945 Liberia awarded concessions to multinational companies to allow them to exploit the large iron ore reserves in the country. Four huge open cast strip mines were built together with railways to transport the ore to the coast but little local labour was employed in these capital intensive projects. Although the Liberian economy appeared on paper to grow with this new activity and exports rose, there were few benefits in other sectors of the large iron ore deposits in the country after 1959." The syndrome ‘the country is rich but the people are poor’ also accounts for anomalies such as american newspaper headlines about ‘gloomy voters in good times’, "To hear economists tell it, life in america has never been better. The gdp - their standard gauge of progress - has continued an upward climb for the last fifty years. Most americans could only scratch their heads and wonder what economy these experts were talking about. They were not experiencing this supposed boom in their own lives." David korten is getting closer to the mark when he alleges, "Indeed we might well look upon growth in gdp as a measure of the rate at which the economically powerful are expropriating the resources of the economically weak to convert them into the garbage of the rich."

It is possible to divide gdp by the number of people living in a country to give per capita gdp. However, considering the possibility of huge disparities in the distribution of goods as noted above, this does not reflect a country’s standard of living.

Gdp is not a measure of a country’s long term prosperity. Gdp measures what has happened in the past not what will happen in the future. Although an examination of past annual gdp figures might reveal an economic trend this is not a guarantee of future prosperity. Current gdp is not an indicator of gdp over the short term. It is even less of an indicator of gdp over the medium term and less still an indicator of gdp over the long term.

Gdp is not a measure of a country’s sustainable wealth. For example, if a country chops down all of its Forests this will give a considerable boost to gdp in that particular financial year but gdp could fall in the following years because there are no Forests left from which to extract resources. No economist has presented a theory of gdp which has a concept of sustainability. Most economists haven’t got a clue what sustainability is - although, it has to be admitted, this is also true of greens as well.

Gdp does not measure national wealth in the sense of .. "unpaid work of the non-monetized 'informal economy': household production, gardening, canning, home repairs, nurturing and parenting, volunteer community service and, indeed, all the co-operative activities that permit the over rewarded competitive activities to be successful." For example, if a person goes into a restaurant and pays for a meal this boosts gdp. If the same person goes home to the same meal cooked by the same person in the same way this does not boost gdp. Gdp ignores what has been called the ‘reproduction of production’ - the services which were once produced by women to enable the male head of the household to perform his productive activities at home (perpetuating the species) and at work. In some countries unpaid activities are more numerous than paid activities.

Gdp does not measure society’s quality of life. It measures the provision of services that may lead to an improvement in the quality of life for many people but it does not measure everyone’s quality of life. Quality of life is affected not merely by material consumption but by clean air, water, and food; good housing, a safe and friendly community, good health, recreation, cheap and frequent public transport, jobs and workplace rights, a wide range of political rights, the opportunities to participate in political activities, easy and cheap access to a fair judicial system, not forgetting a stable climate, etc. There are so many criteria which would have to be assessed to obtain an accurate measure of quality of life it would be impossible to measure them all. It couldn’t be calculated on anything less than a vast range of supercomputers. And gdp certainly does not measure all of these factors.

Many Animals exploited by humans live in appalling conditions (and many are treated in the most barbaric fashion) but gdp doesn’t measure the quality of their lives.

Gdp does not measure the state of human health. It does not measure the damage which pollution inflicts on human health. It is only when people are forced to take time off work or have to pay for medical treatment that gdp is affected. Economists do not regard the costs of medical treatment for pollution-induced illnesses as a burden on the economy, or a waste of resources, and thus classify them as a deficit on gdp. On the contrary, economists designate these ‘costs’ as a boost to gdp. Of course, the fact that a society is capable of providing medical treatment ought to be regarded as a positive achievement so there is some justice in accounting for medical costs in this way - but this shouldn’t be allowed to overshadow the fact that people’s health has been damaged. On the other hand, wilfred beckerman rightly argues that some medical cures, which are cheap and count for a small boost to gdp, are an underestimate of the benefits they produce for human health, "It is ironic that health trends illustrate one of the ways, well-known to economists, in which a rise in GNP may underestimate the rise in welfare, not overestimate it. For example, when a new vaccine or drug is developed that, at low cost, virtually eliminates diseases such as polio or diphtheria or smallpox, the resulting increase in human welfare may be out of all proportion to the medical expenditures actually incurred." The proposition that medical treatments should be treated as a boost to gdp is reasonable where it is long term preventative action against natural diseases but where treatments are for diseases caused either by industry e.g. air pollution, diseased products, etc, or by individuals’ over-indulgence e.g. the cancers resulting from tobacco, meat, and dairy, consumption, etc, the proposition is much less reasonable. Such treatments should be treated as having a negative impact on gdp. In the over-industrialized world where diseases are primarily self inflicted, greater spending on human health is not an indication of increasing human health. The united states of america spends more on health than any other nation but is ranked 25th in the list of healthy nations primarily because of the carnage caused by the herds of obese livestock stampeding across the country in automobiles who fuel themselves up with burgers, crisps and choccies. The greater the self-indulgence, the greater the medical costs, the greater the boost to gdp. It is absurd to argue therefore that a high gdp is thus related to a fit and healthy populace. It has no necessary relationship.

Capitalist economists are prostitutes trying to make the concept of gdp seem far more attractive than it actually is. Like other members of this profession, wilfred beckerman dresses up gdp in a short skirt, fishnet stockings and high heels, and tries to palm off a cumbersome measure of industrial output as a glamorous measure of human welfare.

A distinction is made in this work between the environment, ecology and geophysiology. The term environment is used to cover the human environment, the aesthetics of the natural environment i.e. whether it looks attractive or unattractive, and also natural resources. Ecology is concerned about the species which make up a particular habitat and the way that changes in a habitat changes the relationships between species. Geophysiology is the science of the Earth’s life support system - the way in which the Earth works.

Gdp does not measure the Earth’s natural resources or the rate at which these resources are consumed, "National accounts .. only record assets such as land, and fabricated capital (such as buildings and machines) or human capital (such as knowledge and computer software) where value has been added by work. Natural capital is not recorded."; "Our established approach to assessing our economies is based on gross national product, (GNP) the sum total of goods and services produced in the economy. This indicator is increasingly off target since it takes no account of the natural resource underpinnings of our economies. It ignores the use or rather misuse of capital stocks such as soils, vegetation, water and climate." "The system of national accounting used to measure economic progress incorporates the depreciation of plant and equipment, but not the depletion of natural capital."

Gdp does not evaluate ecological damage. If an industry dumps pollution into the environment it rarely has to pay for the damage caused to ecological habitats. Occasionally, of course, irate environmental protesters succeed in exerting enough political pressure to force a government to insist that a polluter must clean up a particular form of pollution. This response by government is usually a sop to the public and rarely leads to the passing of laws to reduce pollution. It certainly never has any implication for the reform of gdp accounting. It is often the case that both governments and industries welcome the widespread publicity surrounding high profile pollution incidents because clean-up operations help to placate the public’s latent fears of environmental disasters. The public tends to assume the environment is once again safe after governments/industries have ‘cleaned up’ a serious pollution incident - even if the clean up operation makes things worse and even if the biggest source of pollution is the countless number of virtually unnoticed, small scale pollution incidents. The livestock then relapse back into their debauched consumerist stupor. Since in many countries no costs are imposed on pollution, polluters go on damaging the Earth’s multitude of ecological habitats.

The essence of the Earth’s life support system is its Photosynthetic capacity. The myriad of other factors that play a part of the Earth’s life support system are either derived from, or dependent on, Photosynthesis e.g. Photosynthesis has created soils, oxygen in the atmosphere, preserved water on Earth, etc. A substantial amount of rainfall around the world is brought about by Forests and virtually all supplies of fresh water are dependent in one way or another on Forests. The Earth’s health is measured by the scale of its Photosynthetic capacity. The stability of the Earth’s climate is dependent upon the Earth’s Photosynthetic capacity which, in turn, is dependent on the flourishing of Forests around the Earth.

Gdp does not measure the value of the Earth’s life-support system. In addition, no economist anywhere on Earth could provide an estimate of the economic value of the Earth’s health or the stability of the Earth’s climate. Ask economists how much the Earth’s life support system is worth and their faces go blank for any number of reasons:-

In 1997 a group of economists published for the first time an estimate of how much the Earth is worth. However, since they have very little understanding of the Earth’s life support system or how the Earth works the project has to be treated as a first step exercise - it might also have been valuable in helping the economists to realize they live on a planet although whether this will have any impact on their thinking remains to be seen .. "a fifteen year study led by robert costanza, university of maryland, into the price of the world’s ecosystems. His team which included 13 ecologists and economists around the world valued the world’s lakes and rivers at £2,771,000,000,000/yr (if ecosystems charged for their services). The team divided the goods and services the Earth provides into 17 categories ranging from climate regulation and water supply to biological control and food production. It was then divided into different ‘biomes’ such as grasslands, ocean and temperate forests. Figures were then calculated for different services. For example, if a section of forest is worth £1000, the price people would be prepared to pay to keep it would be £1200. The ecological value of the Forest is therefore £2200. The final figure for the earth’s services was £54 trillion/yr - double the world’s combined gnp at £29 trillion."

Gdp does not measure products’ durability - only the price of products. In the eco-nazis world of global capitalism, producers regard product durability as a liability and produce goods with built-in-obsolescence to increase the turnover of goods. This increases gdp. This is an example of the way in which capitalism generates profits through destructiveness.

Economists have been accused of not deducting the negative consequences of economic growth from gdp but, then again, they do not add some of the positives of life to gdp. Wilfred beckerman has done an excellent job in restoring balance by providing a lengthy list of the human benefits not measured by gdp, "There are also aspects of life that are not recorded in GNP and that may have improved. For example, we might want to include the increase during this century in the amount of social capital available (libraries, schools, and so on); the substantial improvement in working conditions, and hours of work and duration of holidays with pay, as well as legal protection afforded to employees; increased social security for the old, the sick and the unemployed; the great reduction in domestic drudgery for the housewife; and the increased freedom to travel and to discover new horizons and new lands."; "There are various other important components of welfare that are not reflected in GNP and which have been increasing over time. They include the output of public capital, such as schools, hospitals, sports facilities, libraries, parks and other public buildings or installations. Unlike private capital or the capital equipment of nationalized industries, the output of these forms of the community’s capital stock is not included in GNP."; "Furthermore, holidays with pay have increased and hours of work have greatly fallen over the course of the century. And leisure-time is a very important component of welfare. But it is not included in estimates of GNP .."; .. "GNP also fails to measure many components of welfare that are probably increasing. .. the generally vast improvements in the sanitary and hygienic conditions of towns in most advanced countries, changes in working and housing conditions .. social security benefits, legislation preventing unfair dismissal, or the provision of redundancy pay and severance allowances."; "It is ironic that health trends illustrate one of the ways, well-known to economists, in which a rise in GNP may underestimate the rise in welfare, not overestimate it. For example, when a new vaccine or drug is developed that, at low cost, virtually eliminates diseases such as polio or diphtheria or smallpox, the resulting increase in human welfare may be out of all proportion to the medical expenditures actually incurred."

The fact that economists do not measure a wide range of phenomena is not the only flaw of gdp accounting.

Another major flaw in gdp is that it includes what would commonly be recognized as negative aspects of life. As far as gdp is concerned .. "negative events such as, say, the depletion of natural resources, the construction of more prisons, and the manufacture of bombs are all measures of "health" by current economic theories."

The following factors have a negative impact on human life but are recorded as boosts to gdp:-

The converse of the fact that economists regard many negative aspects of life as a boost to gdp is that economists treat many of the positive aspects of life as reductions in gdp.

Energy conservation reduces oil consumption thereby reducing gdp, "The worst symptom of ‘consume or decline’ thinking may be infatuation with gnp growth. If energy conservation cuts demand for oil, gnp indicators go down. But isn’t lower oil consumption good? Seen in this light, the gnp is at best a crude measure of economic progress - perhaps a false measure."

Economists use gdp to measure the financial value of manufactured commodities and services - they do not attempt to determine whether these commodities and services are good or bad, "Gdp is basically a measure of total output, and it assumes that everything produced is good by definition. It is a balance sheet with no cost side of the ledger; it does not differentiate between costs and benefits, between productive and destructive activities, or between sustainable and unsustainable ones. It is a calculating machine that adds but does not subtract. It treats everything that happens in the market as a gain for humanity whilst ignoring everything that happens outside the realm of monetized exchange, regardless of its importance to well being."

Capitalism is a virulently destructive economic system which is able to grow only through destruction. It destroys the environment, ecological habitats and the Earth’s life support system; it is currently fostering the greatest mass murdering spree this planet has ever witnessed - all in the name of civilization; it destroys human health, welfare and life; and it destroys private property. It should hardly be any surprise then that gdp measures this destruction.

The problem with gdp is not that it does not measure environmental, ecological, or geophysiological, factors; nor that it cannot put a price on natural resources, areas of outstanding natural beauty, ecological habitats or the Earth’s life support system; nor that it cannot determine the cost of their destruction. The fundamental problem with gdp is that it is boosted by the destruction of natural resources, areas of outstanding natural beauty, ecological habitats, and the Earth’s life support system. It not merely condones, but celebrates and encourages, this destruction.

Capitalism has reaped vast profits from the extermination of Biodiversity - the domestication of Animals; the near extermination of Whales and fur-bearing marine Animals; the decimation of marine and fresh water life; the slaughter of Birds and terrestrial Wildlife, to the industrialization of Animals. The Animal exploitation industry has become a massive capitalist industry but it is also by far the biggest cause of geophysiological destruction. Hundreds of billions of Animals are being maimed, mutilated and murdered around the Earth. The reason that those on the left do not object to this global outbreak of eco-nazism is because they believe that in socialist paradise even more Animals will get their throats slit for the idle consumption of moronic bipeds.

Capitalism thrives on the destruction of humans through wars and exploitation. Wars clear away obstacles to capitalist growth. During wars, governments are so dependent upon capitalists to produce enough goods that all obstacles inhibiting their productivity are removed whether this might be non-capitalists in positions of power, or people not investing their savings, or cartels propping up old production methods. True, the heavy expenditures incurred by wars produce inflation or stagnation which causes the economy to stumble but once it has regained its balance economic growth continues its remorseless expansion.

Capitalism also thrives on the destruction of private property. This is not a new insight. It was a point made by hannah arendt in the mid 1950s, "The german example (postwar prosperity) shows very clearly that under modern conditions the expropriation of people, the destruction of objects, and the devastation of cities will turn out to be a radical stimulant for a process, not merely of recovery, but of quicker and more efficient accumulation of wealth - if only the country is modern enough to response in terms of the production process." Another good example of capitalism’s destruction of private property is compulsory purchase orders to buy land needed for a new road, a new pipeline, a new construction project, new settlement, etc. Capitalism cannot afford to allow private property to stand in the way of any development, "For the enormous and still proceeding accumulation of wealth in modern society, which was started by expropriation .. has never shown much consideration for private property but has sacrificed it whenever it came into conflict with the accumulation of wealth." Pollution is another example of the destruction of private property. Everytime a pollutant wafts over someone’s land this is an invasion of private property. It is strange that landowners complain so much about human trespassers but don’t seem so bothered about the pollutants trespassing on their property.

Capitalism thrives on destruction and gdp legitimizes this destruction by registering it as an increase in economic growth. Perhaps a couple of examples might make such common sense seem less extreme. It is commonly recognized that the social and environmental costs of cars are staggering. Some commentators estimate, "External costs approaching 1 trillion dollars a year, perhaps a seventh of the american gdp, are borne by everyone but not reflected in drivers’ direct costs." The costs are so huge they could never be computed exactly. But what is important here is not the pervasiveness of the costs but that virtually all of these costs trigger off further economic growth. The road/car/oil industries play a vital role in boosting economic growth not simply by producing goods and services but because of the huge scale of damage they inflict on humans, private property and the Earth. The car forces society to pay for a vast array of externalities - hospitals and doctors to tend to car accident, or car pollution, victims; police to patrol the roads; insurance companies to pay for breakdowns; car repair people to stitch cars together again after accidents; judges to adjudicate car accident disputes, etc, etc.

Capitalism thrives on destruction of the Earth, Animals, private property, or humans in order to boost economic growth. It is in the interests of the world’s Earth rapists to destroy as much of the Earth as quickly as possible to increase profits. The greater the ecological destruction, the greater the ecological scarcity, the greater the profits, the greater the boost to gdp, the greater the eventual economic collapse. It is not merely possible to have a high gdp based on large-scale ecological and biological destruction. A high gdp depends on more and more biological, ecological, and geophysiological, destruction. If anything, gdp is a rough measure of ecological destruction. It is all too likely that gdp will reach its peak at the moment when the Earth’s life support system for humans collapses.

Economists’ attempts to measure annual industrial output are blighted by the incorporation of a vast range of negative, or destructive, factors. But economists dismiss these flaws of gdp because multi-national corporations pay them huge sums of money to advertise the fantasy world of global capitalism. It is remarkable that economists and their paymasters can maintain public belief in a theory which is so inadequate and whacky. For sheer fantasy, economics is on a par with christianity and other miraculous religions. We are supposed to live in a modern, progressive, rational, society and yet it is dominated on the religious level by christianity, the secular level by economics, and in entertainment by walt disney.