The True Cost of WellBeing: Our Inefficient Economies
This paper calculates True Efficiency Ratio (TER) for contemporary capitalist economies using two independent methodologies. Our conservative baseline estimates TER at 44% (process efficiency), corresponding to SCDS (sustainability-constrained deliverable share) of 26% when accounting for 1.7× planetary capacity overshoot. An alternative calculation using different but defensible assumptions yields TER of 32% (SCDS 19%). Both approaches converge on the central finding: the economic system converts only 32-44% of current inputs into beneficial output, with sustainability-constrained deliverability at 19-26% (implying 74-81% reduction in deliverable wellbeing unless throughput and efficiency both improve dramatically). We derive these figures using 2024 global data (GDP ≈$110T). The conservative method subtracts $11T of clearly non-beneficial spending and estimates 60% of remaining GDP ($99T) as genuinely welfare-enhancing through bottom-up sectoral analysis, yielding $59T beneficial output. We add $24T of uncounted externalities (ecosystem degradation, climate damages, health burdens) for total resource input of $134T, producing TER of 44%. The alternative method subtracts $25T and applies a 52% beneficial share filter to remaining GDP ($85T), yielding $44T beneficial output against $140T total input (TER 32%). Both calculations follow explicit criteria detailed in Section 3. The damage-side denominator accelerates across multiple indicators: 2024 recorded the highest atmospheric CO₂ concentration (422.8 ppm), largest annual CO₂ increase (+3.75 ppm), and highest military expenditure ($2.72T) in history, while mental health disorders affect 1 in 8 people globally and administrative friction consumes an estimated €146B annually in Germany alone. This analysis challenges GDP-centric policymaking and establishes the empirical foundation for multi-dimensional wellbeing metrics that center human thriving rather than gross economic activity.