Economics panel grades GDP reboot
New calculation adds 3 percent to GDP calculations to represent 'intellectual property,' such as movies, books, research and development
Roger Showley, U-T SAN DIEGO
Friday, April 26, 2013
Kelly Cunningham, National University System
The recalculation further masks the true health of the U.S. economy. States and companies having real producing assets such as manufacturing or oil and gas production will appear to lag states such as California with large R&D and creative work expenditures. States and municipalities with underfunded pension plans will seem to be more prosperous, making states such as California less at risk of being downgraded. Methodology guidelines will be so subjective, however, that historical comparisons and with other countries will become nearly meaningless. Fuzzy accounting only kicks the proverbial can down the road to the inevitable day of truthful financial reckoning.