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#654 - Wealth and Health, 09-Jun-1999

The environmental movement is missing the boat on the biggest public
health issue of our time. Thirty years of scientific research have
established that the most powerful predictor of human disease is
economic inequality, but the environmental movement, for the most part,
is not paying attention to economic issues. Of course some
traditional "tree huggers" have never spent much time worrying about
human health at all. But even the environmental justice movement --
which definitely does care about people -- is not yet fully focused on
the growing gap between rich and poor as the main predictor of human
illness. Most environmentalists still view jobs and the economy as
foreign territory, so most environmentalists are focused on something
besides the main public health problem of our time: growing inequality
of income, wealth and status.

As the NEW YORK TIMES reported June 1 in its weekly Science Section
(and we reported in REHW #497 and #584),

"Scientists have known for decades that poverty translates into higher
rates of illness and mortality. But an explosion of research is
demonstrating that social class -- as measured not just by income but
also by education and other markers of relative status -- is one of the
most powerful predictors of health, more powerful than genetics,
exposure to carcinogens, even smoking.

"What matters is not simply whether a person is rich or poor, college
educated or not. Rather, risk for a wide variety of illnesses,
including cardiovascular disease, diabetes, arthritis, infant
mortality, many infectious diseases and some types of cancer, varies
with RELATIVE wealth or poverty: the higher the rung on the
socioeconomic ladder, the lower the risk. [Emphasis in the
original.]"[1]

It isn't the absolute level of well-being that matters so much as the
relative level. Even among the well-to-do, those higher on the social
scale are healthier. As the NEW YORK TIMES put it, current research is
showing that a mid-level executive in a three-bedroom home in
Scarsdale, N.Y. is more vulnerable to illness than his boss who lives
in a 5-bedroom home a few blocks away.

No one is yet sure how all the components of this problem fit together.
A sense of control of one's life is a key part of it. Stress is
another. Social exclusion and residential segregation -- especially by
race but also by class -- both have important negative impacts. A sense
of opportunity, dignity, self-esteem, the respect of others -- all
these are important for health. Social cohesion -- a sense of
neighborliness -- also plays a role: people live longer in places where
they believe they can trust their neighbors.

As Harvard economist Juliet Schor says, "The reasons may not turn out
to be so very complicated. Humans are social. We judge our own
situations very much in comparison to others around us. It is not
surprising that people experience less stress, more peace of mind, and
feel happier in an environment with more social cohesion and more
equality."[2,pg.4]

If relative standing in the community is what matters most in
protecting public health, then the modern world has been headed in the
wrong direction for at least 20 years. Inequality has been increasing
for 20 years, and not by accident. Most households in the U.S. have
lower net worth than they did in 1983, and the wealthy few are far
wealthier than they were in 1983. Between 1983 and 1995, the inflation-
adjusted net worth of the top 1% of Americans swelled by 17% while the
bottom 40% of households lost 80%.[2,pg.5] In other words, the gap
between the rich and the rest of us has widened. It is this widening
gap that gives rise to disease, research shows.

This problem is not restricted to the U.S., though the U.S. suffers
from greater inequality than any other industrialized nation. The
United Nations HUMAN DEVELOPMENT REPORT 1998 points out that in 100
countries, incomes today are lower in real terms than they were a
decade ago.[3] And in many of these countries, inequality has grown as
small elites have become fabulously wealthy. The HUMAN DEVELOPMENT
REPORT does not say so, but these are some of the fruits of
economic "liberalization" policies and "free trade" agreements.

Within the U.S., the growing gap between rich and poor has not occurred
by accident. It is the result of public policies and private corporate
practices intended to benefit those who own assets at the expense of
those who earn wages.[2,pg.61] Here is a short (and incomplete) list:

** Shrinking wages. Despite some growth in wages in 1996 and 1997,
hourly workers in 1998 still earned 6.2% less per hour (adjusted for
inflation) than they did in 1973 when Richard Nixon was President.
[2,pg.27]

** The minimum wage has become a poverty wage. At $5.15 per hour, the
minimum wage today buys 19% less than it did in 1979, when it was worth
$6.39 per hour, adjusted for inflation.[2,pg.27]

** The median income of young families with children was 33% lower in
1994 than it was in 1973.[2,pg.30]

** The average worker worked 148 more hours in 1996 (1868 hours) than
in 1973 (1720 hours). That's equivalent to nearly 4 weeks additional
work each year, to make ends meet.

** At a median weekly wage of $659, union jobs pay much better than non-
union (with a median of $499). But union jobs have been destroyed by
downsizing, free trade policies, and plain old union busting. As
BUSINESS WEEK summed it up in 1994, "Over the past dozen years, in
fact, U.S. industry has conducted one of the most successful anti-union
wars ever, illegally firing thousands of workers for exercising their
right to organize."[2,pg.32] Fewer than 14% of workers are union
members now, down from 35% in 1955.

** For 20 years, companies have been withholding wages from workers and
transferring that wealth to executives. In 1980, the average CEO in
BUSINESS WEEK's annual survey made 42 times as much as a factory worker.
[2,pg.32] By 1997, the average CEO was making 326 times as much as a
factory worker.

** Pensions are slowly disappearing, and the quality of pension
programs is rapidly declining. Only 47% of workers are covered by
pension plans (down from 51% in 1979). Furthermore, there has been a
shift away from "defined benefits" pensions to "defined contribution"
plans. Under the old-style plans, a worker received a lifetime pension
of a certain amount based on years worked and wages earned. The new-
style plan takes a chunk of a worker's pay check (which may or may not
be supplemented by a contribution from the employer) and invests it. If
the investment does well, the worker has money for retirement; if not,
tough luck. Defined contribution plans accounted for 42% of all pension
plans in 1997, up from 13% in 1975. In addition, only 16% of low-wage
workers are covered by pensions, vs. 73% among workers in the top fifth
wage bracket, so pensions themselves contribute to inequality.

** The federal government subsidizes home ownership through a tax
deduction for interest paid on mortgages for owner-occupied first and
second homes. Unfortunately, this amounts to a subsidy for the well-
off: the more you have to spend, the more your government subsidizes
you. Tax subsidies for affluent homeowners have remained steady for 20
years while federal funding for low-income housing has been slashed 80%.
[2,pg.38]

** Savings are a thing of the past. The U.S. personal savings rate has
fallen from 8.6% in 1984 to 2.1% in 1997 and 0.5% in 1998. People are
spending a larger portion of their incomes on health care, child care,
housing, and college tuition. Even the cost of saving has risen as
banks have steeply increased their service charges, especially on small
accounts that don't meet the high minimums needed to avoid fees.

** The U.S. Conference of Mayors reports that requests for emergency
food increased an average of 14% during the period 1997-1998. One out
of five requests for food assistance went unmet. The AMERICAN JOURNAL
OF PUBLIC HEALTH in 1998 reported that 10 million Americans --
including more than four million children -- do not have enough to eat;
[4] a majority are members of families with at least one member working.

** All members of Congress enjoy publicly financed health care, but
they refuse to extend these same benefits to their constituents. And
the private sector is walking away: in 1985 nearly two thirds of all
businesses with 100 or more employees paid the full cost of health care
coverage. Today fewer than one-third still do.[2,pg.43]

** Increasingly a college education is the key to decent wages, but
since 1989 tuition and fees have increased 94% -- three times as fast
as inflation.[2,pg.47]

** Racism is a key factor in income inequality. It is hard for blacks
to find work and when they do, they are paid less than whites for equal
performance. The NEW YORK TIMES May 23 said "Booming Job Market Draws
Young Black Men Into Fold," reporting that the "booming" economy has
created a tight labor market, resulting in blacks getting good jobs.
But deep in the story, you learn that unemployment among black youth
has dropped from its high of 20% in the 1980s to 17% today -- still
twice as high as among white youths.[5]

** The income gap between blacks and whites is reflected in a
serious "wealth gap" as well. In 1995, the median black household had a
net worth of $7,400 -- about 12% of the median wealth of white
households ($61,000). Median black financial wealth (net worth minus
home equity) was just $200 -- a mere 1% of the $18,000 median financial
wealth of whites.

Hispanic households have even less than blacks. The median Hispanic
household had a net worth of $5,000 in 1995, just 8% of the median net
worth of white households. The median financial wealth of Hispanics in
1995 was zero.

** Housing discrimination explains a good deal of this inequality.
According to a 1991 report on fair housing audits in 25 U.S. cities,
published by the Department of Housing and Urban development, blacks
encountered discrimination more than half of the time.[2,pg.56]

In the past 5 years, 193 studies have been published on various aspects
of socioeconomic status and health, according to the NEW YORK TIMES.[1]
The National Institutes of Health last year declared the relationship
between social status, race and health to be one of its top priorities.
The John T. and Catherine D. MacArthur Foundation has established a
Network on Socioeconomic Status and Health.

But to most environmentalists, the idea of pressing for a high-
wage, "high road" economy -- to counter the present "low road" rush
toward low-paying, part-time jobs without benefits -- still seems like
a suggestion from another planet. (See REHW #618, #619, and #620.)

Luckily a coalition (called Sustainable America) has formed to advocate
for all of the pieces we now know we need: a high-wage economy, clean
production of needed goods and services, and a political democracy in
which people can participate in the decisions that affect their lives.
In sum, Sustainable America is taking on the whole ball of wax.[6] It's
about time someone did.

--Peter Montague(National Writers Union, UAW Local 1981/AFL-CIO)

=====

[1] Erica Goode, "For Good Health, It Helps to be Rich and Important,"
NEW YORK TIMES June 1, 1999, pgs. D1, D9.

[2] Chuck Collins, Betsy Leondar-Wright and Holly Sklar, SHIFTING
FORTUNES; THE PERILS OF THE GROWING WEALTH GAP (Boston, Mass.: United
for a Fair Economy, 1999). Available from: United for a Fair Economy,
37 Temple Place, Boston, MA 02111. Or: www.stw.org. Highly recommended.

[3] HUMAN DEVELOPMENT REPORT 1998 (New York: Oxford University Press,
1998). See http://www.undp.org/hdro.

[4] Katherine Alaimo and others, "Food Insufficiency Exists in the
United States: Results from the Third National Health and Nutrition
Examination Survey (NHANES III)," AMERICAN JOURNAL OF PUBLIC HEALTH
Vol. 88, No. 3 (March 1998), pgs. 419-426.

[5] Sylvia Nasar and Kirsten B. Mitchell, "Booming Job Market Draws
Young Black Men Into Fold," NEW YORK TIMES May 23, 1999, pg. A1.

[6] See www.sanetwork.org.

Descriptor terms: economy; wealth and health; race; racism; inequality;