The UK ratio of 7.2:1 is one of the highest in the free world. Other market economies – such as Finland and Japan have only half as much inequality.
Britain is now used to being unequal, run for years on the assumption that rising prosperity at the top would eventually benefit all. Getting richer used to make societies healthier and happier.
The wealth of nations has little bearing on the great list of social evils examined. But in (almost) every case there is a link with inequality.
Take health. The (unequal) Americans have one third more income than the (equal) Japanese, and yet they die nearly five years earlier. It is well established that the bottom of the heap is an unhealthy place to be. But the Spirit Level shows that inequality does damage right up the social scale.
What is true of individual sickness also applies to social diseases, such as illiteracy and crime. Unequal societies have more prison, more mental illness and more illiteracy – often many times more.
Unequal societies record around three times more mental illness than equal ones. Anxiety disorders and addictions are among the conditions most closely linked to the income gap.
Is it just that diagnosis is more common in the English speaking world? Almost certainly not. Although cultural differences can never be eliminated, the data mostly comes from World Health Organisation diagnostic tests which ask comparable questions in different countries and then deploy common criteria to assess rates of mental illness.
In unequal societies, such as Britain and the US, psychiatric prescriptions are also particularly high.
Prison populations are up to eight times bigger in stratified societies as in equal ones.
Is it just differences in crime? In small part yes, as crimes such as murder are more common in unequal countries. But only 12% of the rise in US incarceration since 1980 is down to crime, and the recent doubling of England’s prison population has mostly occurred while crime has been declining.
The real explanation is that sentences are harsher in unequal countries. Separate analysis shows that more unequal American states more often retain the death penalty.
That Britain has seen inequality rise since the 1980s is widely appreciated, but it is less well known that the widening of the income gap was the sharpest in the developed world. This series from the Institute for Fiscal Studies measures the spread of incomes over time.
It is measured using the so-called Gini coefficient, with its value for each year expressed as a proportion of the reading for 1974. The fact inequality rose more rapidly than elsewhere in Europe suggests the rise was partly down to political decisions as opposed to global forces such as trade or technology.
How inequality was compressed during the 1974-79 Labour government, an economically turbulent era, but also a time of egalitarian incomes policies and increases in the pension.
Under Margaret Thatcher (1979-90) the income gap widened to a chasm, as top pay raced ahead and most benefits were frozen. Tax and benefit changes alone account for about a third of the total increase.
During the early 1990s recession inequality levelled off for a time, but with recovery it soon picked up again.
New Labour has funnelled money towards the poorest, lifting many children and pensioners out of poverty and closing the income gap between the middle and the poor.
But, in Peter Mandelson’s phrase, the party was intensely relaxed about the wealthy, and, perhaps as a result, they have raced ever further ahead of the middle. The combined effect has been to leave inequality broadly stable. By 2006, the most recent year for which data is available, it was close to a record high.
Just as the financial crisis has stoked up resentment about top pay, the Spirit Level provides new grounds for moving beyond the New Labour logic that holds there is no need to worry about overall inequality, as distinct from poverty.
The results may be of most obvious interest to the egalitarian left, but they should also worry liberals concerned with equal opportunity. For social mobility turns out to be undermined by income inequality – poor youngsters find it easier to climb the social ladder when there is less distance to travel.
Nor can more progressive Tories – who are frantically hunting out new ways to repair the social fabric afford to ignore the analysis.
It is hardly news that being poor is associated with disadvantage, but the real twist in the Spirit Level is its claim that the affluent also miss out in unequal societies. The chart on the right provides one piece of evidence. It records the literacy scores in four countries in descending order of inequality: US, UK, Belgium and Finland.
The chart shows that in all four countries people born of more educated parents are more literate than those from uneducated homes. No surprise there, nor in the fact that the effect of parental education on reading is most marked in the most unequal societies – thus the slope of the line is steeper for American than Finnish people.
More strikingly, though, the chart also shows that even those from the most highly educated families are more literate in the more equal countries. At every level of parental education, the rank ordering of countries is preserved – with the more equal countries doing better.
Cross-national comparisons in mortality also suggest the higher classes pay a price for inequality. The chart on the right, for instance, shows death rates for working age men in (unequal) Britain are more graded by social class than in (equal) Sweden. But it also shows death rates are higher overall, including for the top social class. Exactly the same thing is true when infant mortality rates in Britain and Sweden are compared.
Could it all be down to differences in health and education systems?
It seems unlikely, though with education it can be hard to unpick cause from effect because more equal countries invest more. With healthcare, the international statistics suggest extra expenditure has almost no effect on average life expectancy. Besides, the idea that inequality increases mortality for the rich as well as the poor is not some quirk of the countries we have focused on. The Spirit Level looks right across the range of poor and rich American counties, and discovers that while living in rich counties is always healthier, residents in unequal states live less long than those living in equally rich counties in more equal states.
Exactly why the affluent also suffer from inequality is still unproven, but one possibility is that an unequal society creates a great fear of losing social standing, a fear which takes its toll on everybody.
- What do you think?
- Does it matter?
No comments:
Post a Comment