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February 7, 2002
New Book Spotlights Tremendous Inequalities Between Nations and within United States

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Many Americans did not prosper during the economic boom in the 1990s. In fact, the incomes of more than half of Americans largely stagnated over the past 20 years while the incomes of the wealthy rocketed ahead, creating socioeconomic differences not seen since the Great Depression of the 1930s. That is bad news for Americans and for people in other nations strongly influenced by the US economy–and not just because people have less money than they might have expected.

Tremendous inequalities among nations and among Americans undermine health, welfare, and community life, argue Ichiro Kawachi, professor, and Bruce Kennedy, assistant professor, both of the Department of Health and Social Behavior, in their new book The Health of Nations: Why Inequality is Harmful to Your Health.

"I would encourage Americans to reflect on their quality of life and their standard of living," said Kawachi in an interview. "What has the economy delivered for them?"

The gap between per capita Gross Domestic Product (GDP) among nations is astounding. The income ratio between the richest and poorest countries increased from a three-fold difference in 1820 to more than 75-fold nearly 200 years later, write Kawachi and Kennedy. In 1997, GDP per capita in Luxembourg was $30,863, while in the same year, the GDP per capita in Sierra Leone was $410. (In fact, Sierra Leone had a lower level of GDP in real terms than the poorest country in 1820, China.)

Economic inequalities within the US are no less astonishing. From 1996 to 1998, the number of US households that earned more than $100,000 a year or had a net worth of more than $500,000 (excluding the value of their homes) grew by 5 million, to a total of 16.7 million households. Yet, the number of Americans living below the federal poverty line remained at 12.7 percent, one-tenth a percentage less than in 1989 and one percent higher than in 1979. One in five American children live in poverty.

The effects of disparities between the rich and poor in the US play out in more than financial markets. The nation’s health indicators describe a country that far outspends any other on health care yet performs poorly compared to other developed countries in areas such as infant mortality and life expectancy rates. In one such comparison cited by the authors, the US ranked below nearly all rich countries and a few poor ones. The US health indicators are among the worst of the nations of the Organization for Economic Co-Operation and Development (OECD).

Comparisons within the country reveal more startling disparities. Asian-American women born in Westchester County, NY can expect to live on average 90.3 years, according to the Harvard Global Burden of Disease Project. Yet African-American men in Washington, DC face an average life expectancy of 57.9 years, lower than the life expectancies of men living in Ghana (58.3 years), Bangladesh (58.1 years), and Bolivia (59.8 years).

Kawachi and Kennedy take a further snapshot of the inequities in the US: nearly one in five Americans, or 56 million people, is considered clinically obese. Meanwhile, 31 million Americans, including one in six children, face chronic hunger in any given year.

The inequities don’t seem to bother a lot of Americans, who labor under two prevailing myths, said Kawachi. At the top of the economic scale, wealthy people earning more than $100,000 do not consider themselves rich, he said. They are in pursuit of closing an income gap between themselves and the super-rich.

Meanwhile, at the lower end of the economic scale, the poor embrace the idea that hard work will reap major financial fruits–that they can leapfrog into the ranks of the wealthy if they put their noses to the grindstone. While there are well-known examples of people who have moved from lower income levels to those of the wealthy, statistics show that people born into the lower half of the income distribution ladder in the US will most likely remain there, said Kawachi.

"These two pernicious myths have conspired to produce a mindset that seems to resist changing the distribution of income in the country," said Kawachi.

He would like to see a more even income distribution as a result of policy changes: better child care offerings, increased minimum wage, improved job opportunities, a more progressive tax system.

He envisions a system that does not cap the growth of the highest income earners but instead allows the lower levels a better chance to catch up. Right now, he asserts, many policies are geared towards helping the top one percent of income earners.

"You don’t have to sacrifice growth to provide better distribution for everyone," he said. "The US is not the only version of capitalism and free markets available. It just happens to be the most unequal."

 
 
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