November 13, 2012
In the latest issue of the Economic Roundup (Issue 3, 2012) there is an article on Treasury's wellbeing framework that underpins its whole-of-government, whole-of-economy perspective to policy analysis and advice.
Treasury's view of wellbeing is one that:
primarily reflect[s] a person’s substantive freedom to lead a life they have reason to value. It gives prominence to respecting the informed preferences of individuals, while allowing scope for broader social actions and choices. It is open to both subjective and objective notions of wellbeing, and to concerns for outcomes and consequences as well as for rights and liberties.
The elements of this are: opportunities, distribution, sustainability, the level and allocation of risk, and the complexity of choices.
This wellbeing framework is what neo-liberals contest. Thus Judith Sloan in The Australian says that the proper end of economics is maximising per capita gross domestic product; and that Treasury's turn to the end of economics as the wellbeing of the Australian people is the primary cause of Treasury's declining standards, second-rate output and bodgie advice.
The wellbeing framework, according to Sloan, is mushy, confusing and unhelpful and it can be used to justify virtually any decision because the framework relies on the subjective (and political) value judgments of Treasury officials to weight the five dimensions of wellbeing.
As we've come to expect from Sloan's work in The Australian there are no arguments to justify these assertions. She does not, for instance, engage with the ‘capabilities’ approach that underpins wellbeing: an approach that is concerned with providing individuals with the substantive freedom to lead a life they value: where a person’s substantive freedom depends not only on their rights and liberties but also on their own abilities and characteristics, and the economic, social and natural environment around them.
Nor does Sloan bother to explore Treasury's emphasis on what each individual values, with reason, in their life with the more traditional economic interpretations of utility as both preference-satisfaction and happiness.