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Social determinants of health: Glum tidings on the inequality front

Posted by Ted Schrecker
Ted Schrecker
Ted Schrecker is a clinical scientist at the Élisabeth Bruyère Research Institut
User is currently offline
on Monday, 11 June 2012
in CHNET-Works!

The Commission on Social Determinants of Health was emphatic about the role of “the inequitable distribution of power, money and resources” in sustaining socioeconomic gradients in health.  Such inequitable distributions do not just happen; they are the result of choices about how societies govern their economies and distribute the rewards they generate.  Globalization has undoubtedly narrowed the range of such choices – think about Eduardo Galeano’s “magic galleon that spirits factories away to poor countries” (1) and the shift of power in Europe from electorates to bond investors and credit rating agencies – but has not eliminated them.  Three recent publications offer important and sobering insights into how those choices have played out in Canada.

The most recent report on child poverty from UNICEF’s Innocenti Research Centre points out that: “It is now more than 20 years … since the Government of Canada announced that it would ‘seek to eliminate child poverty by the year 2000.’ Yet Canada’s child poverty rate is higher today than when that target was first announced.”  The poverty rate referred to here is not Canada’s Low Income Cut-Off, but rather a standardized relative measure referring to a household disposable income of less than 50 percent of the national median, after adjustments for family size.  Canada, as we can see, does not rank especially well on this measure.   Much of the report is devoted to comparing this measure with an alternative one constructed around 14 specific measures of child well being, for which data are available only for European countries, but among countries for which both measures are available there is a clear correlation between rankings.  

glum tidingsSource: UNICEF Innocenti Research Centre (2012), Measuring Child Poverty:
New league tables of child poverty in the world’s rich countries.
At the other end of the economic scale, a new paper by five Canadian economists explores some of the driving forces behind Canada’s steadily rising level of inequality –in particular, the growing share of income flowing to the top one percent of the income distribution.  “The top income share almost doubled” from about 8 percent in the late 1970s “to reach 14 percent in recent years.  Such an uneven distribution of income has not been seen since the dark days of the Great Depression.”   In a clearly written review of the issues, the report goes on to make a number of important points:

  • The range of occupations represented in the top one percent is far wider than stereotypes would suggest, with only 10 percent of top earners working in financial services as of 2005 (the date covered in the last compulsory Long Form Census, from which many of the report’s data are drawn)
  • Growing inequality is a function not only of changes in the distribution of market income but also, and crucially, of the retreat from redistribution that began in the 1990s
  • “Younger workers, especially those with limited education, face a world with worse earnings prospects than their fathers’ generation,” suggesting a future of further inequality in market incomes as older cohorts of workers who have maintained their wages retire
  • Revenues from increasing income taxes only on the top once percent would probably be relatively modest, even before considering the impact of strategies for tax avoidance that are available to many of the rich

The report also has, to my way of thinking, at least two shortcomings.  

First, and perhaps unavoidably given data limitations, it deals only with income and not with wealth.  Wealth distributions are often more unequal than incomes, and many forms of intergenerational wealth transfers (e.g. bequests of valuable principal residences) do not show up in income figures.  The report points out the role of assortative mating (of two high earners) in increasing household income inequality; its contribution to inequality in household wealth may be more significant.

Perhaps more seriously, the report takes the concept of ‘skill’ as entirely unproblematic, treating the education level associated with a particular occupation as a rough proxy.  However, there is often no clear connection between the intrinsic complexity of the tasks involved and the credentials of those performing them; in terms of labour market outcomes it makes more sense to ask what kinds of tasks, including some very complex ones, are amenable to ‘offshoring’ in low-wage jurisdictions.

Robert Evans, the iconoclastic health economist whose work was the topic of an earlier posting, likewise organizes a recent article around the one-percenters’ growing share of income and on that fact that “these trends,” both in Canada and the United States, “are to a considerable extent a consequence of conscious, deliberate agency by more or less organized and coherent interest groups.”  His most immediate concern is what the retreat from redistribution means for the future of Canadian public health insurance (“a casualty in the class war,” in Evans’ words) now that federal cash transfers to the provinces for health care no longer come with even minimal conditions.

Evans is, as always, playful with his literary allusions; Sherlock Holmes enthusiasts are directed to his endnote 11 and the accompanying text.

Outside the health care field, he emphasizes the health consequences of the “degrading” of environments where people live and work that is associated with rising inequality – a special concern in view of the prospects of a global economic realignment in which many ‘good jobs’ have simply disappeared from the high income world.  Reducing the effects of that realignment on health disparities will require more, not fewer redistributive economic and social policies – certainly not the austerity measures that are now worsening the current recession.  If one agrees with Evans’ analysis of the sources of successful resistance to such policies, then the precarious state of the social determinants of health agenda in Canada is hardly surprising. 

(1)  Galeano E. (2000).  Upside Down: A primer for the looking glass world.  New York: Picador.

Source: UNICEF Innocenti Research Centre (2012), Measuring Child Poverty:

New league tables of child poverty in the world’s rich countries.

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Fostering blissful ignorance about poverty?

Posted by Ted Schrecker
Ted Schrecker
Ted Schrecker is a clinical scientist at the Élisabeth Bruyère Research Institut
User is currently offline
on Monday, 23 April 2012
in CHNET-Works!

Many readers of the federal budget will have missed the decision to shut down the National Council of Welfare, a small and independent-minded unit of the Government of Canada that since 1962 has been a source of information about the extent and depth of poverty and inadequate social provision in Canada. With its demise, a resource for advocacy on social determinants of health has been lost. It is still possible to use the Council's site to access an interactive map showing that (for example) inflation-adjusted social assistance incomes in Ontario are no higher than they were in 1986. And the ground-breaking 2011 study on The Dollars and Sense of Solving Poverty is still available. To quote just one provocative finding from its summary: "The poverty gap in Canada in 2007—the money it would have taken to bring everyone just over the poverty line—was $12.3 billion. The total cost of poverty that year was double or more using the most cautious estimates," although these are admittedly incomplete and fragmentary. The public health community would be well advised to act fast and download the Council's publications before they are consigned to the memory hole.

Another disturbing set of findings about economic insecurity comes from the latest annual survey of Canadian family finances (families of two or more people) from the Vanier Institute of the Family. Some of the study's findings will be familiar: for instance, after-tax income of the poorest 20 percent of Canadian families (two or more people) rose by just 19 percent between 1990 and 2009; the incomes of the richest 20 percent rose by 35 percent. We know from other studies that the trend toward increasing inequality is even more extreme when we look only at the top one percent of the Canadian income distribution: 246,000 people with an average income in 2007 of $404,000 who accounted for 32 percent of all the growth in incomes between 1997 and 2007.

blissful-pic-1Source: Department of Finance Canada.
This illustration is taken from an official Government of Canada publication;
it is used here without Government of Canada endorsement.

Other Vanier findings are less familiar, and more disturbing. For instance, Canada's official unemployment rate in early 2012 would have been 9 percent, rather than 7.6 percent, if the participation rate had been as high as before the recession; 'discouraged workers' who have given up the search for work are not counted as unemployed. And although the overall insolvency rate (bankruptcies and proposals to creditors per 100,000 population) dropped slightly in 2010 and 2011, insolvencies among people aged 55-64 increased by almost 600 percent between 1990 and 2010. Among people over 65 they rose by 1747 percent. This suggests that one of the signal accomplishments of postwar Canadian social policy, cutting the percentage of poor seniors to one of the lowest in the OECD, may be in danger.

As noted in an earlier posting, addressing the possible consequences for population health of such trends unavoidably raises questions of public health ethics. One approach would be to set up an elegant prospective epidemiological study, wait 10 or 15 years, and hope that the casualties, their survivors, or someone are still interested in the answers. Another approach, adopted by the Commission on Social Determinants of Health, is to act on what we now know or can presume with a high degree of confidence, drawing on various sources of evidence and research traditions. So far, our political leaders – and, it must be said, a few of our public health colleagues – seem more interested in punishing the poor and economically insecure, or just ignoring them, than in equalizing opportunities to lead healthy lives. Inequality trends are important for many reasons, but one is that they give the lie to claims that such equalization is unaffordable.

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