Is Income Inequality the Source of All Our Woes?

So, there are two English Epidemiologists and one day they set about comparing differences between low salaries and high salaries in lots of different countries, and then to check if there were more social problems in the countries with bigger differences in icome. Guess what, the graphs don’t lie: big differences income, lead to higher rates f social problems.

Richard Wilkinson and Kate Pickett published a book of their findings in 2010, “The Spirit Level: Why Equality is Better for Everyone”. It is indeed a rare event when an academic style book written by epidemiologists becomes a best seller. The authors presented their work in Trinity College Dublin last November, and their story of social malaise is compelling.

 I know many of you will struggle to persuade yourself to read on but I urge you to keep reading. I felt I had been let in on a huge secret underpinning a lot of the sadness and social unrest throughout our society.

Book reviews for The Spirit Level::

‘A big idea, big enough to change political thinking’, The Guardian

 ‘A remarkable new book … the implications are profound’, Will Hutton, Observer

 ‘The evidence is hard to dispute’ The Economist

 Life Expectancy

The first charts showed that life expectancy does not correlate with National Income except at very low levels of National Income.

However, as further graphical representations showed, life expectancy is strongly correlated with income within rich countries, that is, for a specific country, the lower an individual’s income is, the lower will be his life expectancy.

How much Richer are the top 20%?

How much richer are the richest 20% than the poorest 20%? The biggest gaps are seen in Singapore and the US, the smallest gaps are seen in Japan, Finland and Norway. Ireland is about half-way along the spectrum.

 

Are Health and Social problems  caused by the gap between richer and poorer?

The question asked by Wilkinson and Pickett was: are health and social problems worse in more unequal countries.

The graphs showed a very strong link between life expectancy and the difference between the richest 20%  and the poorest 20% of the population in lots of countries.

What about the children?

For children: the graph showed that the bigger the relative difference in income is, the lower the Unicef Child Well-being Index.

Professor Wilkinson said the issue is one of “social position”. He said that research shows that people in more unequal countries trust each other less.

 Homicide Rates

A graph of homicide rates against Income Inequality for the Unites States and Canada was stark, showing much lower homicide rates for Canada than the US, which has a much bigger inequality gap.

 Lost Community =Lost Trust

Research in Mexico has shown that a withdrawal from community life (symbolised by the ubiquitous prevalence of barbed wired) indicates a withdrawal from community life and a fall in trust.

Prisoners

Further research shows that imprisonment rates are higher and a harsher penal system exists in countries with higher Income Inequality, with Japan and the lowest end of the spectrum and the USA at the highest and worst end of the spectrum.

 Infant Deaths

Similar graphs were shown for Infant deaths per 1000 births, for teenage birth rates and for social mobility.

The Boy Did Good…

Upward social mobility, is a fancy term for improving one’s lot from generation to generation, is represented by a son’s ability to move to a higher social strata than his father. Denmark and Japan were among the countries where upward social mobility opportunities were good, the US was half-way along the spectrum and South Africa and Brazil were the worst performers.

Professor Wilkinson said that the benefits of greater equality are not confined to the poor but extend to all social classes.

 The Impact of Higher Parental Education

Statistics also demonstrate that parents’ education level directly correlates children’s literacy levels. However, the extent of correlation varies, so for example, there is a bigger connection (ie children’s literacy is more impacted by parent’s education standard) in the US than in Sweden.

Professor Wilkinson stated that Income ranking predicts mental distress, not “income”. It is an issue of relativity not an absolute issue.

In South America HIV rates rise as income inequality rises.

Cancer Rates

Considering the causes of death in the US: for breast cancer and prostate cancer, there is no connection, but for murder and heart disease there is a strong connection.

The problem for the US is getting worse  ……

It is interesting to note that after World War II, the US had low income inequality and low scoring for social ills while Japan was the opposite. Now these positions have absolutely reversed. The US is suffering socially and income differences are huge.

A Different Kind of Equality of Opportunity

Social cohesion is fundamental to a healthy society. This challenges the American notion of equality of opportunity being a fundamental goal. It is suggested that there is a thinking in the US which is that social failures are related to different ethnic backgrounds but this is not the case. For example studies of “white only” populations disprove this argument.

There have been little changes in equality for the African American population in recent years, but there have been huge changes in migration patterns for the Spanish population. This ethnic group tend to have good health, this is known as the “Hispanic Paradox”.

The research shows that a lack of respect, discrimination, prejudice all lead to poverty and deprivation.

Why are we so Sensitive to Inequality?

The bigger the difference in incomes, the more issues arise with regard to class and status – the higher the social pyramid, the more that class becomes an issue, society becomes more hierarchical and the quality of social relations deteriorates.

Bullying

There are no figures for adults and bullying. So figures for bullying of children are considered: Sweden has a low bullying rate and low income inequality while the USA has high income inequality and high bullying rates.

Stress

Fibrinogen levels in the blood measurements can be used to assess stress levels in men and women at different employment grades.

More junior staff have higher stress levels and women have more bursts of stress.

Interestingly, women seek out partners with more masculinised features in more unequal societies.

Risk Factors for Psycho-Social problems are:

  • Low social status
  • Weak social connections
  • Stress in early life (pre- and post-natally).

An underlying common thread in psycho-social problems is: feeling insecure, feeling not valued, lost friendship, more status-based judgement by society, and the loss of community is exacerbating this.

Cortisol is also a measure of stress and it has been shown that stress around social issues is much higher than for other stresses.

Status

Literacy was measured in a study in India in two groups: one where it was known who was lower caste and who was from a lower caste and one where the group was mixed and it was impossible to tell which cast people were from. Where the cast was unknown, the lower caste performed better than the higher caste. Where the higher caste knew they were the higher caste they performed significantly better and the lower caste performed significantly worse than they did in the mixed group.

A sense of entitlement goes a long way!

 

Spending

The more unequal a society is, the more will be spent on higher status cars. Data from Google also indicates more expenditure on designer fashion in countries which are more unequal and more searches for cooking recipes in countries which have more equal income.

Studies show that inequality also correlates with household debt, working longer hours, depression and rising narcissism.

 

The Holy Grail

This was it, the Holy Grail, the moment of truth, the lifting of the veil, an explanation of why, when our poor have so much, compared to the poor in developing countries, they are still very, very poor. This presentation was factual, it was uncontroversial, graph after graph spelled out the effects of inequality.

I hope the knowledge and insight I was given will travel and that all those in power from the CEO of a two-man company, to prime-ministers, to the Boards of companies employing thousands begins to understand that Income Inequality is bad for all of us:

You cannot pay your highest earners hundreds of times what you pay your lowest earners and expect to get away with it.