A Measure of Societal Vitality

Figure 1, HDI vs. kWh/c, data points and statistical average,
linear plot, from 10 kWh/c to 29,247 kWh/c, (2002 data)

Figure 2, HDI vs. kWh/c, data points and statistical average,
logarithmic plot, from 10 kWh/c to 29,247 kWh/c, (2002 data)

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A Measure of Societal Vitality

Following is my response to Robert Hunziker’s article “Kill GDP to Help Save the Planet,” published in Counterpunch on 2 January 2020. [1]

Robert Hunziker describes why the economic statistical measure known as GDP — Gross Domestic Product — is a deeply flawed indicator of the actual economic health and societal wellbeing of the United States, and really of any nation. As Hunziker notes, it is based purely on “the monetary value of all finished goods and services,” and as Joseph Stiglitz has shown (as pointed out by Hunziker): “The world is facing three existential crises: (1) a climate crisis, (2) an inequality crisis and (3) a crisis in democracy… Yet the accepted ways by which we measure economic performance gives absolutely no hint that we might be facing a problem.” I agree.

Is there a statistical measure that overcomes these objections? Yes: the Energy-HDI Efficiency Number. Explanation follows.

The United Nations uses an economic parameter called the Human Development Index (HDI) to characterize the typical standard of living of every nation. [2]

It is observed that affluent nations have high HDI scores (they range from 0 to 1) and a high use of electrical energy per year per capita (in kilowatt-hours/year/person the range is from 0 to 30,000), while poor nations have relatively low values for both quantities. In 2006, I made a study of the correlation of national HDI to the electrical energy use per capita, for 177 nations. [3]

The Human Development Index

The UN Human Development Index (HDI) is a comparative measure of poverty, literacy, education, life expectancy, childbirth, and other factors for countries worldwide. It is a standard means of measuring well-being, especially child welfare.

The index was developed in 1990 by the Pakistani economist Mahbub ul Haq, and has been used since 1993 by the United Nations Development Programme in its annual report.

The HDI measures the average achievements in a country in three basic dimensions of human development:

1. A long and healthy life, as measured by life expectancy at birth.

2. Knowledge, as measured by the adult literacy rate (with two-thirds weight) and the combined primary, secondary, and tertiary gross enrolment ratio (with one-third weight).

3. A decent standard of living, as measured by gross domestic product (GDP) per capita at purchasing power parity (PPP) in USD.

Each year, UN member states are listed and ranked according to these measures. Those high on the list often advertise it, as a means of attracting talented immigrants (economically, individual capital) or discouraging emigration.

The Human Development Index is the average of three indices: the Life Expectancy Index (LEI), the Education Index (EI) and the GDP Index (GDPI).

The Education Index is itself a weighted sum of: the Adult Literacy Index (ALI, weight = 2/3) and the Gross Enrollment Index (GEI, weight = 1/3).

All of these measures have minimum and maximum values, which appear in the differences and normalizations used to construct the three major indices. The formulas are as follows:

LEI = (LE – 25)/(85 -25),
LE = life expectancy in years;

EI = (2/3)*ALI + (1/3)*GEI;

ALI = (ALR – 0)/(100 – 0),
ALR = adult literacy rate;

GEI = (CGER – 0)/(100 – 0),
CGER = combined gross enrolment ratio;

GDPI = [log(GDPpc) – log(100)]/[log(40000) – log(100)],
GDPpc = GDP per capita at PPP in USD;

HDI = [LEI + EI + GDPI]/3.

The Human Development Index is a measure that helps to capture the overall socio-economic health of a country, and a measure that allows for useful comparisons whether by international bodies like the UN or concerned individuals.

Linking Energy Use And Human Development

It is evident that a higher standard of living, as indicated by HDI, will obtain when a greater quantity of electrical energy per capita (kWh/c/yr) is available. Yet, in 2002 Ireland expended 6560 kWh/c/yr to provide its people with an HDI of 0.946, ranking 8th in the world; while Saudi Arabia expended 6620 kWh/c/yr (essentially the same as Ireland) to only provide its people — on average — with an HDI of 0.772, ranking 77th in the world.

It is obvious that Ireland made much more efficient use of the energy it expended in order to support the wellbeing of its people. That wellbeing must necessarily include caring for the natural environment within which the national population lives. The statistical measure that I propose for indicating the degree to which a nation’s energy consumption provides for a healthy society is the Energy-HDI Efficiency Number. In 2002, Ireland’s Energy-HDI Efficiency Number was +21 (the world leader), while Saudi Arabia’s was -50, ranking at best 38th in the world (in 2002, the year of the HDI data available for my 2006 study).

In 2002, the U.S.A. expended 13,456 kWh/c/yr to provide its people with an HDI of 0.944, ranking 10th in the world, with an Energy-HDI efficiency number of -1, a level of overall performance behind 21 other nations despite having the 9th highest per capita energy expenditure.

What makes for Energy-HDI efficiency?: low GDP waste on a military establishment, an arms industry, and unproductive government subsidies as with underwriting Wall Street bankster gambling losses; wide use of energy efficient equipment, methods and attitudes; minimal income and wealth inequality; robust national social welfare programs; and diligent stewardship of a healthy natural environment, which naturally contributes to healthy human longevity. [4]

Some nations do a great deal with very little, like Cuba, with an HDI of 0.817 and an HDI rank of 52 out of 177 with an expenditure of only 1395 kWh/c/yr (in 2002). In my study I found that, statistically, a nation would have had to use 2425 kWh/c/yr in order to provide an HDI of 0.817. It is as if Cuba had generated its social benefits with only 57.5% of the electrical energy one would expect. [3]

Societal Vitality

Regardless of what anyone says, all national economies are exercises in intentional social engineering, and as such their features and their degrees of success at providing popular wellbeing can be characterized numerically. GDP alone is a poor indicator of societal health and vigor, but HDI and the Energy-HDI Efficiency Number are much better indicators of societal vitality.

The value of any such indicator, like the temperature shown on an air thermometer outside your window, and the speedometer in your automobile, is to apprise you quantitatively of your current reality so that you can then go and do something intelligent and useful in dealing with it. That is what we have to do about the societal vitality of our national economies and the natural environments they reside within: characterize their overall performances truthfully, and then fix them.

Notes

[1] Kill GDP to Help Save the Planet
Robert Hunziker
https://www.counterpunch.org/2020/01/02/kill-gdp-to-help-save-the-planet/

[2] Human Development Index
http://en.wikipedia.org/wiki/Human_Development_Index

[3] An Introduction Linking Energy Use And Human Development
28 April 2006
https://manuelgarciajr.com/2019/06/09/linking-energy-use-and-human-development/

[4] TABLE: Country Ranking by Energy-HDI Efficiency Number
9 June 2019
https://manuelgarciajr.files.wordpress.com/2019/06/table-a.jpg
AND
https://manuelgarciajr.files.wordpress.com/2019/06/table-b.jpg

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Linking Energy Use And Human Development

This is a re-posting of my report An Introduction Linking Energy Use And Human Development, from 28 April 2006 — unchanged. This is another of my personal favorites. A PDF copy of the report is available through the web-link given below.

An Introduction Linking Energy Use And Human Development
28 April 2006
https://manuelgarciajr.files.wordpress.com/2011/11/efhd_r_01.pdf

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Of related interest and more recent:

Energy for Human Development
9 November 2011
https://manuelgarciajr.com/2011/11/09/energy-for-human-development/

Energy for Society in Balance with Nature
8 June 2015 (27 February 2012)
https://manuelgarciajr.com/2015/06/08/energy-for-society-in-balance-with-nature/

Our Globally Warming Civilization
2 June 2019
https://manuelgarciajr.com/2019/06/02/our-globally-warming-civilization/

Oil, Population, Temperature, What Causes What?
9 June 2019
https://manuelgarciajr.com/2019/06/09/oil-population-temperature-what-causes-what/

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The Economic Function Of Energy

Consciousness and personality can be seen as individualized expressions of energy coursing through metabolic forms we call human life. Similarly, civilization and culture and economics can be seen as social expressions of energy coursing through the web of interpersonal relationships we call humanity.

The nature of the forms of energy used by a society (a nation, a region, an economic class) are an integral part of its identity. So, to answer “what is the right kind of energy to power society X?” requires first determining what kind of society X is intended to be.

This means that all discussions about “energy policy” are disguised arguments about the structure (or restructuring) of one’s society; politics at its deepest. Nature itself voices an opinion in this argument in the form of climate change, its response to humanity’s century-long ringing endorsement of fossil fuels, expressed as global warming.

Using technical results I arrived at some years ago (https://manuelgarciajr.wordpress.com/2011/11/09/energy-for-human-development/), I explore this theme in some detail in the following article.

The Economic Function Of Energy
27 February 2012
http://www.swans.com/library/art18/mgarci41.html

The best economic function of energy is to improve living conditions in harmony with nature.

I try to show the types of futures we could have, both desirable and undesirable, based on the choices we make as a society about energy technologies to power our industrialized way of life. You will not find another article like this. Enjoy.

Energy for Human Development

The United Nations uses an economic parameter called the Human Development Index (HDI) to characterize the typical standard of living of every nation. It is observed that affluent nations have high HDI scores (they range from 0 to 1) and a high use of electrical energy per year per capita (in kilowatt-hours/year/person the range is from 0 to 30,000), while poor nations have relatively low values for both quantities. The following graph shows 2005 data for 177 nations (red x), and a curve fitted to the trend of the data (blue line); HDI is plotted along the vertical axis, energy use (MW-hr/year/person) is plotted along the horizontal axis.

HDI vs. Megawatt-hours/year/capita

HDI vs. Megawatt-hours/year/capita

Data from 2005 include the following:

1. The range of annual per capita electrical energy use among 177 nations was between 40 kWh/year/person and 29,247 kWh/year/person. The range of HDI was 0.281 to 0.963.

2. The United States of America ranked 10th in HDI, at 0.944, with 13,456 kWh/y/p for 4.5% of the world’s population, which produced 24.4% of the CO2 emissions from human activity.

3. The People’s Republic of China ranked 85th in HDI, at 0.755, with 1,484 kWh/y/p for 21% of the world’s population, which produced 12.1% of the CO2 emissions from human activity.

How are the Human Development Index (HDI) and per capita electrical energy use related quantitatively? How are the energy technologies chosen to power a nation or region related to the political economy there?

I explored these questions in 2006, and wrote several reports that present my findings. It is my belief that the United States has wasted the years since 1973 — the first Arab Oil embargo — by not developing a robust public energy generation network for the nation, to replace the patchwork of private fossil fuel and and nuclear energy powered grids we still have today.

Hence, my EFHD reports #1 (Energy for Human Development) and #2 (The Circle of Power) remain up to date. Here they are:

EFHD_R_01

EFHD_R_02

My “GNEP” series of reports is summed up in a presentation (Energy Choices For An Uncertain Future) on the use of Decision Theory to show how the character or preferences of the national persona (or that group empowered to choose the energy technologies for the nation) can be quantified and used to rank the choices between all the combinations of: renewables, coal, nuclear and oil.

GNEP_MG_P_c1

Graphs of the correlation between HDI and per capita electrical energy use are presented in this next report (Comparing HDI and Energy Use, Data & Model)

GNEP_04h.01

The way that Decision Theory was used to rank energy choices is described at length in the next report (Ranking Energy Choices For An Uncertain Future)

GNEP_MG_R07h2a

Technology is not the barrier.

Enjoy