TOPICS > Economy

Inequality Hurts: The Unhealthy Side Effects of Economic Disparity

September 28, 2011 at 12:00 AM EDT
As part of our series on economic inequality, Paul Solman investigates the health effects that inequality can have on individuals and society. To determine the hidden costs, he speaks with epidemiologists, former six-figure income earners who are chronically unemployed and poor teenagers who struggle with inequality each day.
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GWEN IFILL: Now to our continuing series on inequality.

NewsHour economics correspondent Paul Solman has been exploring its effects, and tonight delves into the connection between wealth and health.

It’s part of his reporting making sense of financial news.

PAUL SOLMAN: The monthly meeting of ENG, the Executive Networking Group, offering job search support for out-of-work Chicago area managers.

WOMAN: I come out of a construction background.

MAN: I’m a senior sales and marketing exec.

WOMAN: I was in corporate real estate.

WOMAN: I have been unemployed for over a year.

MAN: I have been involuntarily retired for 18 months.

WOMAN: I have been out of work for five-and-a-half years.

PAUL SOLMAN: From six-figure incomes, putting them in the top 10 percent of America’s income distribution, to chronically unemployed, a dizzying fall that’s one more instance of widening economic inequality in America.

KARL BUSCHMANN, UPS employee: These are people slipping out of the middle class.

PAUL SOLMAN: Karl Buschmann, with a University of Chicago MBA, now loads trucks part-time for UPS.

KARL BUSCHMANN: I’m helping get the packages loaded up for delivery at 8:30 in the morning.

PAUL SOLMAN: Most here had severance pay and savings to cushion the blow. But there’s no denying the status drop.

Milt Haynes helped run information technology at a major drug company.

MILT HAYNES, unemployed: You kind of stick your chest out: I’m an I.T. director at Abbott Laboratories. But now I’m just a nobody. I’m unemployed. I’m like a nobody.

PAUL SOLMAN: These folks used to experience inequality from the top, looking down. Now they’re looking up.

Leonard Lamkin once managed nonprofits.

LEONARD LAMKIN, unemployed: I have been out of work for over 30 months. One of my friends said, you probably qualify for food stamps. You know, if you start to think about it, that’s a scary thing from where I was three years ago. I was in that probably top 7 percent in terms of income.

PETER STURDIVANT, unemployed: It’s relative.

PAUL SOLMAN: Peter Sturdivant, a once-thriving construction manager, hasn’t worked in more than three years.

PETER STURDIVANT: When there’s any reduction, it doesn’t matter if you’re here or up there. There’s still the feeling of a reduction in status, the same feelings. We’re still human.

PAUL SOLMAN: And if you lose status in the economy, that induces stress at every level, no matter where you start.

PETER STURDIVANT: Absolutely.

PAUL SOLMAN: A thousand miles away, someone you may remember.

DENISE BARRANT, unemployed: So this one’s fine. This one’s fine. Ooh, what happened over here? And you feel like you stand out like a sore thumb. My house needs to be painted. The roof leaks. And I do feel ashamed, because I feel like, so I’m bringing the value of their houses down. And that’s very stressful.

PAUL SOLMAN: We have been following the story of this laid-off manager for quite a while, Denise Barrant, unemployed since 2008, no job prospects in sight, her foreclosed house about to hit the auction block, and this spring, a diagnosis of breast cancer and hospital stays for extreme hypertension.

DENISE BARRANT: For stress. So my blood pressure was out of control, and they had to hospitalize me twice.

PAUL SOLMAN: Stress, an obvious product of losing your job, but a symptom, it seems, of something else as well: losing your status.

MICHAEL MARMOT, University College London: Health and disease are the good and bad effects of where you are in the hierarchy, mediated by the effects of chronic stress.

PAUL SOLMAN: We first interviewed British medical researcher Michael Marmot on this program years ago.

MICHAEL MARMOT: We see it for heart disease. We see it for some cancers. We see it for gastrointestinal disease. We see it for violent deaths.

PAUL SOLMAN: According to Marmot and colleagues, the stress of low status explains some otherwise puzzling statistics. The U.S. leads the world in health care spending, for example. Yet, in infant mortality, we rank 47, below Malta, Slovenia, Cuba.

In life expectancy, America is 50th, six years less than Macau. In what do we lead the world? Obesity. And given our incomes, we’re well up there in economic inequality.

Richard Wilkinson suspects there’s a connection.

RICHARD WILKINSON, “The Spirit Level”: On lots of different measures of health, more unequal societies seem to do worse.

PAUL SOLMAN: Also a British epidemiologist, Wilkinson is the co-author of “The Spirit Level,” which reports a strong correlation between inequality and poor health society-wide.

RICHARD WILKINSON: Societies with bigger income differences between rich and poor do worse on a whole range of measures. They have worse health. They have more violence. They have more drug problems. Standards of child well-being are worse.

PAUL SOLMAN: And not just a little bit worse, says Wilkinson — sometimes, way worse.

RICHARD WILKINSON: Perhaps two or three times the level of mental illness as the more equal countries, because, in a more unequal society, there is more status competition. We judge each other more by status, and we feel more judged.

NAKIESHIA FULLINGTON: I’m from this poor area. I’m from, like, where all the criminals are.

PAUL SOLMAN: At Nakieshia Fullington’s highly selective exam school in Boston, her classmates were a lot better off.

NAKIESHIA FULLINGTON: I knew I was as smart as them, but I felt like my family, like, where I come from wasn’t as good as, like, where they came from, basically.

PAUL SOLMAN: Did it make you feel bad to be considered lower on the ladder?

NAKIESHIA FULLINGTON: Really bad, like — I don’t know how to explain. It’s like a horrible feeling to feel like you’re less than other people.

PAUL SOLMAN: And the harder you try to keep up, the more stress there is, physical, mental and economic.

NAKIESHIA FULLINGTON: Like, since I went to, like, a mostly white school, it’s like their clothing was simple, but it cost more than, like, something that I can afford. But it’s like you come to the black community, and, like, they will spend like their whole paycheck just to have that one thing that had like — let’s say like Polo — like the Ralph Lauren Polo has become a really, really popular trend for, like, a lot of blacks.

DAIQUAN BRADFORD: But, no, there’s a deeper meaning of why the people wear those shirts.

PAUL SOLMAN: Daiquan Bradford also went to a mainly white school, lives in the inner city.

DAIQUAN BRADFORD: It’s like you want to buy all these items to, you know, fill this insatiable hunger of trying to be something you cannot be.

RICHARD WILKINSON: Money becomes more important because it says what you’re worth. So people in more unequal societies work longer hours, much longer hours, are more likely to get into debt. They save less of their income. They spend more — and all those issues to do with how you express what you’re worth and the status insecurities, and so on.

PAUL SOLMAN: Doctors Wilkinson, Marmot and others point to data that all this status-seeking takes its toll — in hypertension, for instance.

Blacks worldwide have rates of high blood pressure similar to whites, but, in the U.S., 41 percent of blacks have high blood pressure, as compared to 27 percent of whites. At least some of that might be due to inequality.

And as inequality grows, it arguably exacts a price from those higher up the ladder as well, who become more and more stressed about clinging to the top rungs.

MIT economist Frank Levy:

FRANK LEVY, Massachusetts Institute of Technology: As the economy looks more and more unequal, then upper-middle class parents are going berserk trying to get their kids into a position to get the brass ring, putting more and more time into kind of pumping up their kids, extra courses, extra activities, so on and so forth. And lower-income families just don’t have the resources to do that.

PAUL SOLMAN: But is inequality really bad for all of us? Or might it perhaps provide some benefits in the long run, even for the have-nots?

Daiquan Bradford grew up near the bottom.

DAIQUAN BRADFORD: We couldn’t pay the gas and light bill, so it was in a situation where we had to use candles, and it was kind of dark, but it was the wintertime, so it was kind of cold, too. So what we had to do was, we had to kind of huddle as a family.

PAUL SOLMAN: But rather than make him feel bad, he says, the disparity he experienced going to school in an upscale Boston suburb fueled his ambition.

DAIQUAN BRADFORD: I was eavesdropping on a conversation about, you know, their families owning businesses, how they live in this nice mansion, and then I felt, in a strange sense, it was a mixed feeling of admiration and envy.

And so, with that, I took on a role of, this is why I have to succeed, this is why I have to work harder, because they have something that I don’t have, so I need to work harder to actually get to that level.

HARALD UHLIG, University of Chicago: Inequality in the future can be a great incentivizer.

PAUL SOLMAN: University of Chicago economist Harald Uhlig, originally from the much more equal economy of Germany:

HARALD UHLIG: Imagine two people, you know, one is working hard and one is just lazy and goofing off. And suppose both get the same thing down the road. I mean, wouldn’t the hardworking person say, why am I doing that? So inequality motivates people to be inventive, to work hard, to pursue a career, to pursue an education.

RICHARD WILKINSON: This is the argument that to make the rich work harder, you need to pay them more. To make the poor work harder, you need to pay them less.

PAUL SOLMAN: Again, Dr. Wilkinson:

RICHARD WILKINSON: Of course, if you actually look at how people do in different societies, the chances of moving up socially for poor children are much higher in the more equal countries. And, in the U.S., the chances are particularly low.

We sometimes say, if you want to live the American dream, you should move to Finland or Denmark, which have much higher social mobility.

PAUL SOLMAN: Meanwhile, for these jobless executives west of Chicago, the dream is to regain lost income and status.

KARL BUSCHMANN: So, I just keep going, keep going.

PAUL SOLMAN: South of Boston, Denise Barrant’s dream is to keep from losing it all.

DENISE BARRANT: Words can’t even describe how stressful it is, and you know, and you feel like, where is there the light at the end of the tunnel?

PAUL SOLMAN: Denise Barrant simply doesn’t know, and neither, as it turns out, does anyone else.