Yes and no. Productivity is not measured in physical output. It's measured in how much money people pay, which has problems, of course. If it really goes straight to the landfill, then nothing has been produced. Countries may pay for that sort of thing with taxes to create jobs, but that's not a neoliberal thing at all.

Eventually, the only reasonable way to measure productivity is in terms of what people want. That's what you do when you look at what people pay for something. Any other way would also have problems.

Failure to consider environmental degradation and resource depletion are indeed problems. Norway is a better example for this. They have a very high productivity on paper, because oil. But that basically pretends that they literally produce the oil, rather than pumping it out of the sea floor. In reality, that's more like selling off an inheritance. And that's not even considering the damage done when fossil fuels are burned.

“Productivity” already goes some way towards addressing such problems. It is usually GDP divided by hours worked (for money). US Americans work far more hours than their European counter-parts, so that their average incomes are much higher. Whether they are actually richer, depends on the value of “free” time. “Free” in quotes because it does not include necessary work like housework or healthcare visits.

That assumes the incomes to follow a similiar spread and productivity gains to actually benefit the workers. But that is not the case. If you look at the median income https://en.wikipedia.org/wiki/Median_income the order is entirely different. And this is not because the people in Ireland only work 25 hours. They work 39 hours.

Productivity by itself, even accounting for how many hours people work, is not a suitable metric to adress how well the people benefit from the economy. What we see it more and more productivity being siphoned off for ultra rich people. So cutting that part out would not harm the life quality of normal people at all. It would even benefit them, as ultra rich could not as agressively buy up houses and other investments that used to be reachable for working class people.

The point being made is that the global economic order, as built and maintained by our world leaders and “captains of industry”, is obviously not sustainable in a variety of absolutely crucial ways. We need to find a less capitalistic and more humanist dynamic to orchestrate our society by. It’s becoming more and more clear that simply assigning dollar-value amounts to everything and then comparing them is not a good holistic strategy for managing the efforts and direction of a civilization.