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Stigliz writes: "A sign of prosperity is supposed to be good health and longevity. But, while the US spends more money per capita on medical care than almost any other country (and more as a percentage of GDP), it is far from topping the world in life expectancy."

Joseph Stiglitz. (photo: AP)
Joseph Stiglitz. (photo: AP)

When Inequality Kills

By Joseph Stigliz, Project Syndicate

13 December 15


his week, Angus Deaton will receive the Nobel Memorial Prize in Economics “for his analysis of consumption, poverty, and welfare.” Deservedly so. Indeed, soon after the award was announced in October, Deaton published some startling work with Anne Case in the Proceedings of the National Academy of Sciences – research that is at least as newsworthy as the Nobel ceremony.

Analyzing a vast amount of data about health and deaths among Americans, Case and Deaton showed declining life expectancy and health for middle-aged white Americans, especially those with a high school education or less. Among the causes were suicide, drugs, and alcoholism.

America prides itself on being one of the world’s most prosperous countries, and can boast that in every recent year except one (2009) per capita GDP has increased. And a sign of prosperity is supposed to be good health and longevity. But, while the US spends more money per capita on medical care than almost any other country (and more as a percentage of GDP), it is far from topping the world in life expectancy. France, for example, spends less than 12% of its GDP on medical care, compared to 17% in the US. Yet Americans can expect to live three full years less than the French.

For years, many Americans explained away this gap. The US is a more heterogeneous society, they argued, and the gap supposedly reflected the huge difference in average life expectancy between African Americans and white Americans.

The racial gap in health is, of course, all too real. According to a study published in 2014, life expectancy for African Americans is some four years lower for women and more than five years lower for men, relative to whites. This disparity, however, is hardly just an innocuous result of a more heterogeneous society. It is a symptom of America’s disgrace: pervasive discrimination against African Americans, reflected in median household income that is less than 60% that of white households. The effects of lower income are exacerbated by the fact that the US is the only advanced country not to recognize access to health care as a basic right.

Some white Americans, however, have attempted to shift the blame for dying younger to African Americans themselves, citing their “lifestyles.” It is perhaps true that unhealthy habits are more concentrated among poor Americans, a disproportionate number of whom are black. But these habits themselves are a consequence of economic conditions, not to mention the stresses of racism.

The Case-Deaton results show that such theories will no longer do. America is becoming a more divided society – divided not only between whites and African Americans, but also between the 1% and the rest, and between the highly educated and the less educated, regardless of race. And the gap can now be measured not just in wages, but also in early deaths. White Americans, too, are dying earlier as their incomes decline.

This evidence is hardly a shock to those of us studying inequality in America. The median income of a full-time male employee is lower than it was 40 years ago. Wages of male high school graduates have plummeted by some 19% in the period studied by Case and Deaton.

To stay above water, many Americans borrowed from banks at usurious interest rates. In 2005, President George W. Bush’s administration made it far more difficult for households to declare bankruptcy and write off debt. Then came the financial crisis, which cost millions of Americans their jobs and homes. When unemployment insurance, designed for short-term bouts of joblessness in a full-employment world, ran out, they were left to fend for themselves, with no safety net (beyond food stamps), while the government bailed out the banks that had caused the crisis.

The basic perquisites of a middle-class life were increasingly beyond the reach of a growing share of Americans. The Great Recession had shown their vulnerability. Those who had invested in the stock market saw much of their wealth wiped out; those who had put their money in safe government bonds saw retirement income diminish to near zero, as the Fed relentlessly drove down both short- and long-term interest rates. With college tuition soaring, the only way their children could get the education that would provide a modicum of hope was to borrow; but, with education loans virtually never dischargeable, student debt seemed even worse than other forms of debt.

There was no way that this mounting financial pressure could not have placed middle-class Americans and their families under greater stress. And it is not surprising that this has been reflected in higher rates of drug abuse, alcoholism, and suicide.

I was chief economist of the World Bank in the late 1990s, when we began to receive similarly depressing news from Russia. Our data showed that GDP had fallen some 30% since the collapse of the Soviet Union. But we weren’t confident in our measurements. Data showing that male life expectancy was declining, even as it was increasing in the rest of the world, confirmed the impression that things were not going very well in Russia, especially outside of the major cities.

The international Commission on the Measurement of Economic Performance and Social Progress, which I co-chaired and on which Deaton served, had earlier emphasized that GDP often is not a good measure of a society’s wellbeing. These new data on white Americans’ declining health status confirms this conclusion. The world’s quintessential middle-class society is on the way to becoming its first former middle-class society. your social media marketing partner


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+52 # PABLO DIABLO 2015-12-13 18:46
"Greed is good" --- Ronald Reagan.
WAKE UP AMERICA. A huge military build up, more than "daily" mass shootings = a sign of a declining empire
+17 # MidwestTom 2015-12-13 20:58
I believe your quote is from Alan Greenspan, not Reagan.

I agree that we are a declining power, destroyed by trying to control the world, and perpetuating a philosophy that we MUST continuously grow.
+17 # MidwestDick 2015-12-13 22:58
Alan Greenspan, the ascended master of weasel worded, opaque, preposterous pronouncements would never say anything so direct. To amuse yourself, try to imagine how he would torture this idea before he was ready to present it to the world.
In fact, Oliver Stone wrote, and Michael Douglas spoke these words in the movie "Wall Street". Stone was riffing on a speech by Ivan Boesky, given at Berkeley shortly before he was carted off to the pokey for insider trading.
+3 # Vardoz 2015-12-14 18:57
And we are being robbed and impoverished.
+2 # Vardoz 2015-12-14 18:59
We may be a declining empire but as Bernie says we are the richest nation in the history of the world with all gains going to the top- where the money is ending up is not declining - the 99% is,
+21 # jimallyn 2015-12-13 19:22
Sure, the middle class is disappearing, but the rich are getting richer, and that's what really matters, right?
0 # Bruce Gruber 2015-12-14 13:48
In a re-sent Pugh! Pole, axed on a dozen Murican Billionaires relaxing poolside at Burj Al Arab Jumeirah in Dubai, participants overwhelmingly (8:4) agreed that death of the Middle Class was misinterpreted in the 'study' referenced above.

They suggested that alcohol and drugs (up 7.2% - ALL profit) were absorbing an increasingly larger percentage of the Middle Class take home pay. Since the decline in hours worked (down to 30/week) and pay scale (reduced 18% - from $18.75 to $12.00/hour for new skilled hires - generating an additional 800 points on the Dow/Jones )didn't provide enough for water AND electricity, requiring "light" to read their lotto cards, prevented most Middle Classics from affording Arugula. Combined with cancelled contributions to Social Security and Medicare, the loss of both health and 'prestige' at being Middle Class was driving the poor folks to drop down into the "hands-out, "taker" Class. They hadn't died, they'd just changed categories.
+25 # C.H.Winslow 2015-12-13 19:50
The remedy, changing and improving the rules of the economic game, is mainly political in the short run. But changing the politics may well require the long, and arduous work of winning elections, especially those which choose the district-drawer s in State legislatures. Otherwise, politicians who are paid to make policy for those who benefit from economic inequality will maintain a gerrymandered electoral system that keeps them and their cronies in the Federal House of Representatives in power.

On the other hand, the Trump candidacy may be fortuitous in this regard. By bundling off a large group of low concept/low information voters, who are actually harmed by the politicians they vote for, and separating them from the establishment GOP who are bought by 1%, the Republicans may be split, resulting in a Democrat landslide at many levels of government. Such an opportunity may trump almost all other possibilities that will come along in the near future. If such a landslide does occur, it is important for all of us to make powerful, but sagacious, use of the opportunity. We may not get another chance to catch up with the rest of the world.
-5 # MidwestTom 2015-12-13 21:13
I would agree with you, but you overlook the percentage of Democrats who are for Trump. I am told that a recent Texas poll had him almost tied with Sanders for second on the Democratic side.

If Trump gets the nomination, which I doubt, he will sweep all of the low information voters from both parties that have watched his shows. Americans are sick and tired of the Ruling Class. The Republicans have managed to get control of redistricting to the point that they may have a lock on the House, which means that if one really wants change, one has to be realist and realize that if Bernie won he would be stymied by the House, while Trump MAY not be, but the Republican party hates him also.

There is an article in the Post today pointing out that since the Republicans were afraid to challenge Obama's major steps, the office of the Presidency has gained power. It pointed out that Obama chose not to enforce some laws, changed passed laws, and ordered actions that by law require Congressional action; all unchallenged. I say this because Congress is slowly becoming powerless, and we are drifting to an elected (at least for now) dictatorship.
+1 # Bruce Gruber 2015-12-14 13:51
Try to stay away from pills.
-2 # Vardoz 2015-12-14 18:56
Trump supporters consist of 4% and are those who rarely vote.
+19 # angelfish 2015-12-13 22:13
As I draw ever nearer to my three score and ten, I am appalled at what has happened to what USED to be the Greatest country in the World. Then again, maybe we were NEVER that great. Interning Japanese Americans and confiscating their property, having two completely different sets of Laws for White people and Blacks, subtle misogynistic attitudes towards women, ALL are now blatantly visible and almost proudly flourished by the Right-Wing Fanatics who see NO correlation between themselves and their brethren in ISIS, ISIL and BOKO HARAM. Substitute fleeing Syrians/Muslims for the Japanese and the comparison is frightening. Police are now Bullies instead of helpers and defenders of the innocent, many becoming perpetrators themselves if an incident provokes their particular prejudice. I have hope that Bernie Sanders will win the Democratic Nomination for the Presidency and that he cleans the ReTHUGlican's Clock once and for all! The Nut-Jobs and Haters will always be with us but, hopefully, they will never again get as close to the White House as they currently seem to be. America will make sure that another ignorant, trigger-happy lunatic never comes within a mile of the Oval Office EVER again in our Life-Time!
+8 # Granmabeck 2015-12-13 22:57
Allot of this is the consequence of the wage gap. According to IRS figures the top
0.01% of tax returns, that's about 17,500 families and individuals, document average income before taxes of $31 million. Assuming conservatively that these people are making 5% on their assets (much are not documented)that comes to $10 trillion. Stiglitz and others have listed the probable origin of this state of affairs as coming from a combination of generous tax treatment for the wealthy,, subsidies to business, trade agreements not to mention underpaying the employees of the companies they control. To add insult to injury much of these assets are stashed offshore to further avoid taxes and what's worse these funds are not part of the US economy. The result of this state of affairs is that there aren't enough tax revenues to support government services such as education and research, payments to the indigent and don't forget our stagnating infrastructure. These are the services which are indispensable to maintaining a modern economy and allowing it to grow. Over 40% of the population struggles to make ends meet Actually everybody suffers even including the assets of the super wealthy.That does not look to me as a strong economy We have a culture in which what becomes private property is sacred and there are no limits to greed. It was not always so. Things could change when enough people who care about these matters take the trouble to vote.
0 # Depressionborn 2015-12-15 00:28
All true Granny, but what I don't understand is how there can be 5,000,000 job openings nationwide going unfilled, many well paying.

Something doesn't add up
+12 # treerapper 2015-12-14 03:11
If you really scrutinize which elected officials vote for what you can clearly see that it often doesn't matter which side of the aisle your rear end occupies..

Too many of our Congresspeople are bought and paid for by some part of the military industrial complex and those people have not an iota of interest in whether we live or die tomorrow.

Until you change that approach to governing, we will continue to find ourselves on the slippery slope to a 2-class society with most of the people who occupied the middle, joining the bottom tier.

How do get there? I've got my three score and ten and I'll be damned if I know. I really thought the Country would have learned something from the Civil Rights movement and from Nam but we, collectively, are just as dumbed down as before and a lot poorer.
+6 # solasoma 2015-12-14 07:57
Health care needs to change - and Colorado is leading the way with ColoradoCare - an initiative on the 2016 ballot to provide healthcare for every Coloradan. We'll have lots of opposition, so we'll have a hard, uphill ballot to get this passed.

To learn more, visit ColoradoCareYES .co. To donate, go to the green tab at the upper right corner.
+2 # 2015-12-14 08:09
What if we devoted all this collective brainpower to designing the society we wish to live in after this one? History shows that when empires collapse, the resulting power vacuum is often filled by some demagogue (Hitler, Stalin...) Not surprising, when much time and effort is spent on criticizing (or bringing down) the failing empire and comparatively little on developing a better alternative and the way to get there. Thomas Jefferson & Co. did well in this regard, seizing their opportunity. The climate crisis may be our own opportunity to rethink everything, learning from the past, but without wasting energy on throwing rocks at it.
0 # Depressionborn 2015-12-14 21:19
# 2015-12-14 08:09

a society design? ya sure.
There are three choices: Liberty; Tyranny; 3. chaos
• Liberty is unfair
• Tyranny is slavery
• chaos is the result of revolution

The fearful distain Liberty, the weak vote for slavery, revolutionaries are hung.

And there is something in the Bible about "Nothing new under the Sun"
+2 # Vardoz 2015-12-14 13:12
Poverty kills people and inequality = poverty. We need to eat good food, be able to raise our families, afford daycare, housing, medical care and all the important necessities of life. So deep inequality that is purposely imposed on the majority of a nations population is a form of economic terrorism as Biden once called it. This is why we and a multitude of others are voting for Bernie Sanders. He has detached himself from the corporate regime that is implementing the agenda of inequality and as a mayor, 2 term congressman and now 2 term senator has the important knowhow to work within the system. We also will not be voting for all those establishment Democrats who endorsed Hillary who is up to her nose in big money and corporate donors. We will be voting for the Progressives on the ticket or the Democratic Socialist and we have told our reps this. Why should we vote for the status quo that is threatening our health, safety and welfare? Bernie Sanders will lead the way and open doors that the 99% is desperate for. With the coming of the TPP and Citizens United we need a president who will fight for the majority tooth and nail and Bernie is that man.
0 # 2015-12-14 16:44
KANDO@LTIDEWATER.NET … Designing a fair, sane, and livable society is the right idea. But as the old saying goes -- "You must understand where you came from in order to know where you are going". The current structure of human civilization, including our own culture, is severely twisted and pathological. In order to forge a new and better, and healthier world, we need to understand why we failed so miserably in the prior one … So we do not repeat the same mistakes.

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