GDP - The Absurd Economic Measure of Value

Two economists are walking in a forest when they come across a pile of shit.

The first economist says to the other “I’ll pay you $100 to eat that pile of shit.” The second economist takes the $100 and eats the pile of shit.

They continue walking until they come across a second pile of shit.

The second economist turns to the first and says “I’ll pay you $100 to eat that pile of shit.”

The first economist takes the $100 and eats a pile of shit.

Walking a little more, the first economist looks at the second and says, "You know, I gave you $100 to eat shit, then you gave me back the same $100 to eat shit. I can't help but feel like we both just ate shit for nothing."

"That's not true", responded the second economist. "We increased the GDP by $200!"

The next time you read: GDP became X, Y, Z, please think of this story. And, ask some sensible questions:

1. Are people getting better jobs?
2. Who is getting the additional share of income? (if it is truly increasing)
3. Is your tax burden going down? (or rising)