This Planet Money episode investigates the calculation and potential manipulation of the Gross Domestic Product (GDP). The hosts interview Steve Landefeld, former head of the Bureau of Economic Analysis, who recounts instances of political pressure to alter GDP calculations during the Clinton and Trump administrations. The discussion covers the formula for GDP (Y = C + I + G + X - M), the challenges of accurately measuring quality improvements in services (hedonic adjustments), and attempts by various groups to influence GDP calculations (e.g., including unpaid household labor or environmental costs). Landefeld advocates for maintaining GDP's integrity and suggests creating alternative indicators rather than fundamentally altering the established formula. The episode concludes with a discussion of the upcoming release of the first-quarter 2025 GDP report and the potential implications of proposed changes.
