Equality and Sustainability

level_spirit_level.jpg

The Spirit Level is a recent book by Richard Wilkinson and Kate Pickett that argues that many societal ills can be traced to the degree of income inequality, rather than to the absolute level of affluence as is often believed. After a few introductory chapters, the authors present some nine chapters full of data that illustrate significant correlations between inequality and a wide variety of social indicators. One figure after another shows that some social indicator gets worse as inequality increases. The United States is almost always the worst as it has the largest income inequality of all the nations included in the study. The data have been derived from the works of other researchers.

I have reproduced one of their many examples below. (Thanks to Tony Judt and the New York Review of Books)


The authors include explanations for the results displayed in each of these nine chapters. The single causal mechanism that shows up most often is the power of relative levels of affluence (income) to overwhelm absolute levels. No matter how much someone has on an absolute scale, perceptions of position in some social pecking order exert more influence on life styles, and it is life styles that lead to differences in longevity, mental illness, teen pregnancy, and so on.

Some of the data may be suspect; a book, The Spirit Level Delusion questioning the data and thesis of the book was quickly published in response. The authors of this book aim to discredit the liberal policy positions taken toward the end of the Wilkinson and Pickett book. I did find a few of W & P's arguments relatively unconvincing, but the overall mass of data, derived from scholarly sources, and the accompanying discussion left me completely convinced that much of the basic policy of the developed and developing countries is on the wrong track, and that it will take substantial government initiatives to correct the current orthodoxy.

The last few chapters address the connection between equality and sustainability arguing, based on the data, that more equality leads to higher levels of well-being for all. Not surprisingly, the policy recommendations focus on leveling income rather than raising it. The authors do recognize that at very low income levels, it is important to raise the absolute level as well as maintain equality.

Highly skewed corporate salaries have contributed heavily to the unbalance. I did not hear any reference to the impact of inequality during the recent controversial conversations about the huge salaries paid to executives in the financial industry and large companies in other sectors. Most of the remedies are, given the present conservative tilt in most of the larger economies, politically challenged--capping salaries, for example. One of the obvious remedies proposed is to return to a more progressive income tax. Another is to encourage and facilitate more employee owned companies.

If one has been listening to the arguments that have been made for change in the health care industry, the financial sector, estate tax re-establishment, and other similar arenas, the voices of growth far outshout those on the side of favoring policies designed to produce more equality. The Spirit Level makes a convincing argument that more equality benefits all. The blinders economic policy makers wear, unfortunately, keep them from paying heed to the lessons of the book. I recommend it as an important read for those seeking practical routes toward sustainability.

| | Comments (1)

« Previous Entry   Next Entry »

1 Comments

M Schwartz said:

One of the problems seems to be that they are comparing homogenous scandanavian countries with ethnically diverse countries (Milton Friedman noted you couldn’t compare these countries). Racial groups have different propensities for heart disease, diabeties, alcoholism. In terms of crime groups have different testosterone levels and MAO-A variants are distributed differently.

For instance, Hong Kong & Singapore have some of the highest levels of income inequality but are nearly the best in the world for having low infant mortality rates and low crime.