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While reading my spring issue of American Educator today, I came across this interesting article, Greater Equality the Hidden Key to Better Health and Higher Scores. In it the authors provide a graph showing the relationship between social/physical health and level of income inequality for about 20 developed countries. Not surprising to me was that the USA ranked highest in income inequality and worst in a composite score of social/ physical health measures (i.e. life expectancy, mental illness, drug abuse, education, obesity, homicides, imprisonment rates, teenage births, social mobility.)
The point of this article written for teachers was that decreasing levels of inequality would increase educational achievement for students of all income levels. This is illustrated in a graph showing literacy levels for adults of differing education levels in countries with different levels of inequality. In short, it shows that Paul Wellstone spoke the truth in his well-known quote "we all do better when we all do better."
For an interesting look at more graphs and discussion of the evidence that more equal societies work better for everyone, check out The Equality Trust website. Here, when I clicked to learn more about education and equality, I was pleased (and not surprised) to see that Minnesota ranked among the states with lower levels of inequality and this corresponded with our low high school drop out rate. Of course this idea about the negative effects of inequality seems very logical and even obvious to a strong liberal such as myself.
I am curious what others with a different worldview / political ideology think of the idea /evidence. Questions:
- Do More Equal Societies Work Better for Everyone?
- While the greatest gains go to those at lower income levels, would the wealthy benefit, as well, from greater income equality (as authors argue)?
- Would decreasing the inequality in the USA through a progressive tax code save $ on things such as prisons, health care, drug treatment, welfare (fewer teen mothers) etc?
- In a wealthy country such as the USA, will more economic growth lead to a happier, healthier, or more successful population (especially if the gains keep going to the few at the top)?
16 comments:
As much as I but like to use comparative studies of other countries to bolster one of my arguments, I most often find that such studies are to retrieve doubly flawed because of the old apples and oranges problem.
Basically all the benefits that you described can be easily obtained by simply denying the personal freedoms we have taken (too much) for granted in this country. We are free to make as much money as our talent and hard work can gain us. We are free to abuse drugs, food, sex and each other, and we do it in such heterogeneity that unequal outcomes would be surprising if they did NOT appear here.
We have more personal choices and less societal "interference" in those choices than almost anywhere in the world. As one of our brilliant founding fathers observed, our system of government is "suited to a moral people, and no other." We are rapidly losing our agreement on what our common morality is and ought to be, and therefore our personal freedom, unconstrained by personal responsibility, creates public tragedy.
Our youth pastor once had a sign on his door that said: "Medical science has discovered that certain sulfa drugs have been proven 100% effective against sexually transmitted diseases. They are sulfa-denial, sulfa-esteem and sulfa-control."
I skimmed the whole thing and found no real rationale regarding causality. It seemed they just put together some data that showed correlation and went with it.
Laurie, What did you see as their causality argument?
The problem I see is that giving things to people does not necessarily lead to their success... Often it dooms them to failure... Have you read "When Atlas Shrugged"? It is a fun fictional read and explains the concepts well.
The question is what would help the poorest American's find hope and incent them to strive and work for that better life? Instead of trying too guilt the high performers into caring for them? When their are so many easier and more enjoyable paths available to them in the USA...
I mean look at our overweight and obesity stats. Maybe life is just too easy in the USA, and many have stopped trying to be all they can be...
John,
about the causality argument:
from the FAQ section
of their website, I found this their best argument: "We show evidence that 10 or 12 different problems tend to move together. That implies that they share an underlying cause. The association between inequality and our Index of Health and Social Problems is very close and no one has yet suggested an alternative."
When I tried to think of what else might explain the USA high rate of inequality and lower scores than other countries on so many measures, I came up with our greater diversity, being a nation of immigrants, legacy of slavery, racism. Also, our weak democracy.
Why do the Scandiavian/N. European countries, with their social democracies or strong safety nets, do so well on these social/health meausres, if these handouts just makes people lazy and dependent?
About The Atlas Shrugged, I have heard of it, but have not read it. Given its length, that could be a book for summer reading, if I have not given up or gotten bored with my attempts to understand conservative/libertarian thinking.
To anonymous,
I am curious about what freedoms you see as denied in the many European countries with fewer social problems. When I traveled through most of Europe, the countries seemed to have as many or more freedoms than the USA. They certainly don't have our rate of incarceration for drug offenses.
They do elect govts that tax more to provide more services/greater safety net, but that is their choice to make. My concept of freedom includes FDR's third freedom, which is freedom from want.
Maybe it works for the Scandanvians and N Europeans because they started out with fewer folks in poverty, little/no slavery, few immigrants??? Whereas due to slavery/bigotry, many impoverished immigrants, many illegal immigrants, free trade beliefs, buy cheap vs buy American beliefs, etc, we have a whole boat load of them...
Ironically we are probably doing EXCELLENT since we took many of their poor off their hands ~100+ yrs ago...
Remember: "Give me your tired, your poor, Your huddled masses yearning to breathe free, The wretched refuse of your teeming shore. Send these, the homeless, tempest-tost to me, I lift my lamp beside the golden door!" Statue of Liberty
Not sure what you would do with the higher taxes? I am a fan of Parent classes, Early Childhood Education and helping to ensure People entrenched in the Cycle do not give birth too many kids... (preferable through birth control) Not giving away CASH, that just deepends the cycle. Here are some links worth reviewing.
Wiki Cycle of Poverty
Wiki Cycle of Poverty
It looks like achieving equity is pretty difficult. When you have to overcome the internal beliefs that trap the people we want to help.
John, I agree with your approach, I think you have the nugget of a solution. Much of the troubles-- the gross inefficacy-- of US social welfare programs is because many of them if not most are paid in CASH. Perhaps it is a recognition of the old ideas of personal responsibility and freedom that we do this, but it only works with people who know of and care about personal responsibility.
There are two reasons why private charity is for more efficacious. One is that benefits are almost always in terms of goods or services-- food shelves for the hungry, shelters for the homeless, low cost child care in the church basement, etc. The other is that it is personal, expecting a response from the recipient that is a sign of personal responsibility and gratitude for the (temporary) assistance. Even the local Catholic transitional housing program has (relatively new and) strict rules about avoiding drugs and alcohol and looking for work.
Another way of stating the reason for our "poor" showings against Western European welfare states (now realizing the folly and unsustainability of such, BTW) is that they have homogeneous populations with a long history of shared morality-- a social compact, if you will-- that we simply do not and cannot have. What common morality and social compact we did have has been fractured by the ascendancy of a liberal multiculturalist viewpoint and enabled by the imposition of a social welfare state onto a population of supposed rugged individualists.
J. Ewing
From J...
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John,
I agree with your approach, I think you have the nugget of a solution. Much of the troubles-- the gross inefficacy-- of US social welfare programs is because many of them if not most are paid in CASH. Perhaps it is a recognition of the old ideas of personal responsibility and freedom that we do this, but it only works with people who know of and care about personal responsibility.
There are two reasons why private charity is for more efficacious. One is that benefits are almost always in terms of goods or services-- food shelves for the hungry, shelters for the homeless, low cost child care in the church basement, etc. The other is that it is personal, expecting a response from the recipient that is a sign of personal responsibility and gratitude for the (temporary) assistance. Even the local Catholic transitional housing program has (relatively new and) strict rules about avoiding drugs and alcohol and looking for work.
Another way of stating the reason for our "poor" showings against Western European welfare states (now realizing the folly and unsustainability of such, BTW) is that they have homogeneous populations with a long history of shared morality-- a social compact, if you will-- that we simply do not and cannot have. What common morality and social compact we did have has been fractured by the ascendancy of a liberal multiculturalist viewpoint and enabled by the imposition of a social welfare state onto a population of supposed rugged individualists.
J. Ewing
While there seems to be little (no) agreement with my suppostion that more equal societies work better for everyone, nothing I've read here has persuaded me that they don't. The correlation of so many factors of a societal well being with greater equality is just too strong.
I seem to agree slightly with both John and J. about root causes of poverty/inequality, but I go on from there and see many societal problems as both resulting from, and contributing to even greater levels of inequality, like in some sort of feedback loop. So the question is what policy interventions, primarily from govt, would most effectively address the many social ills and I agree with the authors' argument that ones to reduce inequality will be most effective. Things such as living wage and govt doing more to reduce/eliminate unemployment make sense to me. I think there is agreemnt that the dignity that goes with working is better than welfare programs, which btw I don't believe are all that much cash based. I think of food stamps, low income housing, medicaid, childcare asstance etc, when I think of our wellfare state.
"Things such as living wage and govt doing more to reduce/ eliminate unemployment make sense to me."
Any thoughts regarding how to do these things?
Government control of jobs, wage controls, price controls, trade barriers, etc have been shown repeatedly to not work?
Bush, Obama and crew have been spending lots of money in the name of jobs creation with questionable results. The reality is that if consumers and businesses do not need the product or service, the number of jobs will not increase significantly. And they won't be sustainable.
That is why I am a proponent of buy American, even if it costs extra money. The reality is that many of the liveable wage jobs have been shipped over seas by the choices us consumers are making.
The reality is that the poor likely do not have a skill set that justifies their earning that wage in our modern society. Or do you want to pay your fast food order taker $10 to $12/hr? And force people to pay them for 40 hrs/wk, even if they only need them part time.
By the way, this will have a huge ripple effect. All of our bills will go up and therefore the liveable wage will need to go up further...
It seems to me that getting these folks educated is the only answer. There is no sense paying uneducated folks that don't work hard a liveable wage. I think we used to call that work study in college...
By the way, this article looks like both the Liberals and Conservatives are determined to keep wages low... If you want wages to go up, job 1 is getting the non-citizens out of that low education job market...
USA Today: Immigration Reform
An interesting and possibly pointless observance from my vacation in Arizona. Most of the folks working in the fast food restaurants and service industries are younger caucasians... It seems odd compared to MN... Any ideas why it is this way?
Why? Because AZ law prohibits companies from employing illegals, and enforces it. OUR two largest cities are "sanctuaries."
an interesting comment about government's responsibility to "ensure payment of a livable wage and increase employment." They're absolutely and incontrovertibly mutually exclusive. When the minimum wage goes up we suddenly find fewer minimum-wage jobs open because no employer will pay out wages in excess of the value of what the employee produces. It is simple economic fact, and Congress has never been able to repeal the Law of Supply and Demand despite repeated attempts. A year or so ago a caller to a conservative talk show said that he heartily supported an increase in the minimum wage. Before the incredulous host could even ask, he volunteered that "I am in the automation business, and every time the minimum wage goes up my business goes through the roof."
Finally, let me take a crack at the original question. If one simply parses it out, it seems redundant. Certainly it must be true that if everybody succeeds, it is better than having only some of the people succeed. On the other hand and in the real world, I would argue that it is the less equal societies that work better for everyone, with the US of A being the prima fascia evidence. We have some people who have gotten very rich, and yet even the poorest among us have a standard of living that is the envy of much of the world. Not even the European social democratic societies that we are compared to can match us in average standard of living. (Whether our high standard of living is "necessary" or not is not the issue and at any rate is our decision to make, no one else's.)
J. EWING
Upon further reflection I think what is most needed are govt policies to drastically reduce level of unemployment. While I have always been able to work as a substitute teacher while between jobs, these experiences of undermployment help me understand how much it sucks to be out of work.
I surfed around the web a bit and came up with a few ideas of govt policy that could help. It seems that the fed's monetary policy can make a difference, but they are currently overly concerned about inflation (I won't say more because I don't really understand much about this.) By any reasonable assessment the 2009 stimulous saved or created a lot of jobs, but with our current house GOP's radical focus on budget slashing more stimulos is a nonstarter.
But that won't stop me from linking to a far left viewpoint, where the economist blogger advocates for a universal job guarantee, sometimes also called an employer of last resort (ELR) program in which government promises to provide a job to anyone legally entitled to work. (Why should the focus always be on far right wing policy ideas while the far left is completely ignored?)
What's needed is greater public demand for policies leading to a serious reduction in the unemployment level. What's also needed is more imagination. In the 1970s, Americans also faced a global recession and double-digit unemployment -- but back then politicians had the courage to think big.
I truly read the complete text of Laurie's links, and I think I remember now why the Liberal policy ideas don't get too much air time...(hahaha) Sorry, I just had to write that.
By the way, I thought our unemployment programs were our Employers of Last Resort. We pay folks and they have time available to improve their qualifications and look for jobs. If we had them cleaning parks, when would they find new jobs?
I think Liberal folks have a misperception regarding the problems that are still rampant in the European countries. (especially diverse ones like ours) Socialism sounds so fair and ideal, yet reality never seems to work out that way. Here are some interesting links.
Denmark to Dismatle Slums
WN Slums in Paris
Lucianne Germany Fears New Slums
This is a fascinating thing to be aware of...Freakonomics Attitudes Toward Poverty According to this, Europe could end poverty if everyone only made less? And the USA could end poverty if everyone made more? Maybe this aligns with J's comment. I think I like America's perspective.
Finally, the Stimulous jobs are like the ELR jobs in that they may be beneficial, but they are usually not self sustaining. When the Government/Society's piggy bank is empty, they end. Where as Private Industry jobs are self sustaining as long as the economy keeps working.
Laurie,
Attach a link regarding the FED monetary policy. I am curious what they advised since money and rates are about as low as they can go. And encouraging high risk loans is part of what got us in this problem in the first place.
John,
Thanks for taking the time to read my links. I am not at all surprised you found them amusing. Here is a You tube video for you. As a spec. ed. teacher I find my small attempts to make the world a little more accommodating for my students more hopeful than the often daunting challenge of trying to prepare them to get by in our competitive society.
About the slums in Denmark and France, I remember seeing news coverage of riots in Paris slums a couple of years ago and thinking that our integration of immigrants is one of the things that makes me proud of the USA (it was right around the time M. Obama was getting flack for her supposed anti American comments.)
about monetary policy, I have 2 links which will no doubt make more sense to you than they do to me:
Dean Baker- The Federal Reserve is required by law to pursue price stability and full employment
Battle Lines Drawn on Fed's Next Moves (WSJ)
CBS Fed Holds Rates
It looks like the FED maintained it's very loose monetary policy in Mar2011 again. I think there is plenty of money out there to be had if you are qualified for the loan.
In the first link, it looked like Dean Baker wanted the FED to start securing more mortgages and enabling higher inflation rates.
As you know, I am against any moves that encourage the creation of more RISKY loans since I feel that is what landed us in this mess. To many people got too comfortable being in DEBT, with little in SAVINGS.
His insensitivity to inflation is interesting. With so many people moving into the "Fixed Income" portion of their lives, I would think this would be disastrous for them. And the higher prices would make it difficult for those looking for first time loans. Then there is the complicated stuff.. How it impacts world trade and American jobs.
For Investors and Debtors, it would be pretty good. All of our physical assets would appreciate in monetary terms. Your house value would go up while your fixed rate mortgage would stay the same. And those rich people would get richer. (ie in terms of dollars)
I think the FED is doing pretty good... Some people think the FED is operating a race car that has excellent steering.(ie they control things) Unfortunately I think it is more like trying sail a ship through strong changing winds and currents. Taking extreme action may end up with us being way off course...
I couldn't get to the WSJ article w/o signing up for something. The first paragraph noted that a small but vocal minority wanted to tighten up the fincial controls. I think that is likely the case as always. Some on both sides of center.
In reading some articles for my church class on economic justice I came across
yes! magazine and also
Web of Debt website which helped me better understand how the Fed and monetary policy work. One author makes a strong case for state owned banks as both a way to help with budget deficits and also boost local economies and employment.
"By any reasonable assessment the 2009 stimulous saved or created a lot of jobs," By the government's own assessment, those jobs cost nearly $1,000,000 apiece. For one year. Furthermore, we were promised unemployment would never get above 8% if the stimuless passed, and you remember it went over 10%. It's come down recently but the "real" number is already approaching 20%-- Great Depression numbers.
Our big mistake as a country is to think that government policy can create jobs by affirmative effort. Government cannot create a single job, not one, unless it first takes money away from somebody that HAS a job. Government has no money except what they take form taxpayers. Period.
Now, if they spend money, say, on roads, they contract that to private businesses who employ real people and produce real "goods and services." It may even be something people want. I was pleased to see the road from Grand Teton to Yellowstone get resurfaced, for example. But the vast majority of government spending isn't "productive" like that.
The best way for government to "create jobs" is to quit spending money they don't have (which robs the capital markets of money business needs to expand), and to quit spending money for things we don't need and maybe don't want (like Obamacare), and then lower taxes, so we've all got more money to buy things WE want or need.
Less equal societies like ours work because everybody has the opportunity to be rich and works to achieve it. Those who do employ those looking for it, and buy the first HDTVs at ridiculously high prices, enabling mass production and prices come down, and now everybody has one. That's "working better" in my book, and it's BECAUSE of the unequal distribution of wealth. Since wealth is produced by people working, our inequality produces the greatest wealth in history.
J. Ewing
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