Interrogative Imperative Institute

Article - Wealth And Health


With the kind permission of Peter Montague, the editor of the Rachel E-Zine on environmental issues, articles from the archives of Rachel are being re-printed through this web site. These articles offer a very good overview of many facets of environmental research, issues, problems, questions, and challenges, but for a far more comprehensive, in-depth introduction to ecology please go to the Environmental Research Foundation web page directly.

Wealth And Health


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. (Return to article)

[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: . Highly recommended. (Return to article)

[3] HUMAN DEVELOPMENT REPORT 1998 (New York: Oxford University Press, 1998). See . (Return to article)

[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. (Return to article)

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

[6] (Return to article)

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

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