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Factoring happiness into policies

President-elect Ma Ying-jeou’s (馬英九) campaign focused on boosting the nation’s economy. The economic achievements of former US president Bill Clinton and globalization were the major reasons for the unprecedented economic development in the US and the rest of the world at the end of the 20th century.

But psychologist and Daniel Kahneman, the 2002 Nobel Prize Laureate in economics, has said that the goal of public policy is not to maximize GDP, but rather to increase happiness.

Economic growth is one way of doing so. It is a necessary condition for happiness, but not the only one. We should not forget the big picture and should avoid worshipping GDP as a cure-all.

The thinking behind Ma’s development strategy, like his “633” economic policy and his proposal for 12 major construction projects will prove incapable of surmounting the challenges of “irrational exuberance” that resulted from the efforts to maximize GDP at the end of the 20th century.

The price is excessive development that has led to environmental pollution and global warming, as well as excessive exuberance that has fueled corporate extortion, a growing rich-poor gap and increasing social polarization.

Taiwan should use its uniqueness and specific advantages as it carves out a path for future development.

First, it should should not strive for GDP development benchmarks like South Korea and Singapore. These are benchmarks of the past century. Instead, the nation should employ the economic benchmarks of the 21st century, based on the goals of sustainable development and human welfare. These benchmarks include health, education and the environment.

Taiwan should transform its economy into an economy that focuses on promoting individual freedom and happiness and aims to develop environmental sustainability.

In addition, the nation should implement a fair and just public welfare system. The old economic theory says fairness runs counter to efficiency and public welfare is an impediment to growth. But the example of Denmark and other Scandinavian countries disproves this theory. A fair and just society can stimulate people’s vitality and creativity and drive the economy.

Taiwan belongs to the 10 percent most affluent countries in the world. It should learn from the Scandinavian countries when it comes to public welfare and fairness. Denmark and other countries not only seek to improve public welfare and environmental protection, they are also among the world’s most competitive economies.

Last June, Leicester University in the UK published the first World Map of Happiness, and listed Denmark as the happiest of 178 countries. Denmark has essentially eliminated poverty and the worst case of official corruption uncovered there in the past three decades involved a low-level immigration official accepting NT$230,000 from a student from China.

Development must be in harmony with the environment. Taiwan should use its natural resources to help the public and it should promote vitality and creativity by making use of its diverse ethnic and cultural groups. It should seek to create great literature, art, music, dance, theater and film, for both the domestic and international markets. Developing the nation’s creative spirit should be more important than lowering personnel costs.

The key to avoiding unequal wealth distribution is to increase overall education levels and creative ability. The nation’s west coast is already overdeveloped and there is no room for more railroads or petrochemical factories. Development on the east coast should not follow the model used on the west coast. To facilitate traffic along the east coast, a ferry service would be better than the proposed Suhua Freeway.

Ma should have the courage to adjust his policies. He should stop viewing the world from the perspective of Taiwan’s relations with the US and China.

Ma would do better to visit Denmark and learn from its economy than to visit Singapore before he takes office. He should seek to help Taiwan move toward a bright and happy future, not a dark and bitter one. This will be an important test of Ma’s capabilities.



Ruan Ming is a consultant at the Taiwan Research Institute.

Translated by Anna Stiggelbout
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