Thursday, April 23, 2009

More Reviews - The Spirit Level: Why More Equal Societies Almost Always Do Better

A few more reviews of The Spirit Level: Why More Equal Societies Almost Always Do Better,
by Richard Wilkinson and Kate Pickett. Two positive reviews and a dissent (from a seemingly conservative reviewer, so maybe not unbiased in his reading).

Financial Times:

The Spirit Level: Why More Equal Societies Almost Always Do Better
By Richard Wilkinson and Kate Pickett
Allen Lane £20, 320 pages
FT Bookshop price: £16

homeless man in New York City subway
Neglected A homeless man in New York City. In Wilkinson and Pickett’s book, the United States, the most unequal of all the countries considered, scores poorly on nearly all the social indicators used in their argument

For more than two decades, we have been encouraged to believe that the prosperity of the few is to the ultimate benefit of all. We should not begrudge bankers their bonuses, or oligarchs their billions. Their actions make us all better off. In 2009, this argument seems less persuasive. As taxpayers chip in yet more billions to bail out the world’s financial institutions, and economic growth in Russia and China falters, it is a timely moment to present again the case for a more equal distribution of wealth.

Richard Wilkinson has long been associated with the important and careful Whitehall studies of the social determinants of health, pioneered by Sir Michael Marmot in 1967. These analyses of the experience of British civil servants over several decades show that the incidence of illness and mortality, even among people with secure jobs and incomes, is substantially affected by social class and economic position. Wilkinson himself has been a campaigner against inequalities in health – inequalities in physical health, that is, not just inequalities in health provision – since the 1970s.

In The Spirit Level, Wilkinson and co-author Kate Pickett attempt to draw wider implications. They argue that, among the rich countries of the world, states with less inequality in incomes perform better on a wide range of social indicators. The claim is supported by evidence on diverse phenomena such as reported happiness, mortality, obesity, teenage pregnancy, social mobility, drug use and the incidence of violence.

The book will probably irritate most economists, including those who, like me, are sympathetic to its basic stance, and believe that economic success is culturally embedded. The irritation partly comes from the superficiality of the two policy chapters, which make a convoluted connection to climate change, and wax eloquently in support of worker-controlled enterprises.

But a larger source of irritation is the authors’ apparent belief that the application of regression methods to economic and social statistics is as novel to social science as it apparently is to medicine. The evidence presented in the book is mostly a series of scatter diagrams, with a regression line drawn through them. No data is provided on the estimated equations, or on relevant statistical tests. If you remove the bold lines from the diagram, the pattern of points mostly looks random, and the data dominated by a few outliers.

The United States, the most unequal of the countries considered, scores poorly on virtually all the social indicators used. Japan, rated one of the most equal, has long life expectancy, a small prison population and low levels of violence. Within Europe the Scandinavian countries are generally distinguished by high levels of both equality and social performance. These observations probably account for most of Wilkinson and Pickett’s findings.

This is not to downplay the significance of the issue. The argument is a powerful counter to any simple equation of social progress and the advance of GDP. But the causal relationships involved are complex. Many factors differentiate the US, Sweden and Japan. The ongoing World Values Study by Ronald Inglehart and associates is probably the most careful attempt – though there are others – to classify the different cultures of advanced societies. These differences feed into both observed inequality and social indicators.

An obvious conclusion is that there are many societies which perform well in terms of their own criteria. America, Sweden and Japan are just different from each other – their achievements are not really commensurable. But Wilkinson and Pickett are not content with this relativist position. The subtitle – “more equal societies almost always do better” – makes a universalist claim. The political right has often argued that inequality makes everyone better off, even if more of the benefit goes to the rich. Wilkinson and Picket want to assert instead that equality makes everyone better off, even if more of the benefit goes to the poor.

The authors provide some arguments and figures to support this proposition. If more equality means less violence, for example, the potential victims of violence benefit even more than the potential exponents of violence. Death rates among working-age men are lower in egalitarian Sweden than in less equal England and Wales. Such death rates are lower not just in the lowest social class but in all social classes, although the difference in mortality in the higher social classes is less marked. Wilkinson and Pickett offer a biological explanation for this observation – greater social equality implies less social stress, not just for the poor, but for all.

But they do not have data to support a more general claim that equality benefits the rich as well as the poor. They would have to show, for example, not just that average levels of educational attainment are higher in more equal societies, but that the educational attainments of the children of rich families are higher in more equal societies. In the paradoxical modern world in which obesity is a problem of the poor rather than the rich, they would have to show that not just the poor but the rich are fatter when resources are distributed more evenly. But they don’t.

And probably can’t. I suspect the claim that equality benefits everyone is just not supportable. Rich Americans may suffer more stress and greater risk of crime and be surrounded by a crumbling public infrastructure. But affluent people in the US believe that their higher material standard of living and the greater opportunities available to their children make them better off and it is very difficult to present a convincing argument that they are wrong.

So we shall just have to continue believing that bankers’ bonuses and preposterous remuneration packages for chief executives are bad for society, not that they are bad for the bankers and chief executives. That argument is a lot easier to present than a year or two ago.

John Kay is author of ‘The Long and Short of It: A Guide to Finance and Investment for Normally Intelligent People Who Aren’t in the Industry’ (The Erasmus Press)

New Statesman:

Last among equals

Roy Hattersley

Published 26 March 2009

The Spirit Level: Why More Equal Societies Almost Always Do Better
Richard Wilkinson and Kate Pickett
Allen Lane, 352pp, £20

Labour's indifference to the gap between rich and poor has been a ruinous mistake

It is, or ought to be, impossible to read The Spirit Level without feeling ashamed to discover that almost all the international comparisons of social well-being confirm that the UK has a worse record than almost every other prosperous country. Only in Portugal, Singapore and the United States of America is life expectancy lower and the infant mortality rate higher. The same picture emerges in the analysis of detriment after detriment. In the league table of teenage illiteracy, illegal drug use, adult obesity, underage pregnancy and mental illness, the UK faces relegation to the ranks of failing societies. The UK also appears near the top of those tables that measure income inequality. The correlation is near to absolute. Inequality goes hand in hand with the social diseases that blight whole communities. The rational conclusion to be drawn from the mass of evidence that Richard Wilkinson and Kate Pickett have assembled is that all of us, irrespective of income, have much to gain from the creation of a more equal society.

This is what makes The Spirit Level such a crucial contribution to the ideological argument. It demonstrates the scientific truth of the assertion that social democrats have made for a hundred years – sometimes more out of hope than intellectual certainty. And for readers with more basic political tastes, it offers what ought to restore the morale of the Labour Party: the doctrine which is, or should be, at the heart of its programme has a universal application. Equality is not just a policy for the poor; it benefits us all and, therefore, should appeal to us all. Perhaps a very few neocons, living in gated estates and buying private pensions and health care, ask what it matters to them if, in the world outside, there is violence on the streets and poverty in the inner cities. But Wilkinson and Pickett take the argument for equality a stage further than the guarantee of the civic “tranquillity” that Tony Crosland said was equality’s bonus. On the basis of research – not hunch – they conclude that many, perhaps most, members of affluent societies want to “move away from greed and excess towards a way of life more centred on values, e in a minority. In consequence, they become reluctant and unhappy competitors in the rat race.

So, the vulgarities of New Labour are (or were) as politically unproductive as they were embarrassing. Hazel Blears’s notorious defence of the £10,000 handbag puts into perspective what “the project” really meant by “meeting the aspirations of the people”. The aspiration that the Blairites had in mind was the acquisition of higher incomes and more property. For years, Labour was said to lose votes by assuming that the electorate shared its lofty ideas about the good society. It now seems that the party has sacrificed support by underestimating the appeal of what used to be its vision of a better future.

Altruism and self-interest combine. All we now need are politicians with the courage to say so and the will to introduce policies which offer a more rewarding life than the chance to have a bigger motor car than the family next door.

For me, the most dispiriting event during Tony Blair’s Downing Street years was his refusal, when pressed by Jeremy Paxman, to express regret that, during his premiership, the gap between rich and poor had widened. His reply was that it was by changes in the absolute, rather than the relative incomes of the poor, that his governments should be judged. At the time I regarded the answer as inadequate for reasons that it was hard to believe the then prime minister did not recognise. A widening income gap amounts to a demonstration of the government’s reluctance to fight deprivation with all the (redistributive) weapons at its disposal. And the penalties of poverty include the loss of influence, status and respect which come from being at the bottom of the heap. It is now clear that he also misjudged the mood of the nation. And the rejection of his enthusiasm for “more millionaires” has increased with the years. ICM reported this past week that 82 per cent of people polled “wanted the government to take active steps to reduce the gap between the rich and the poor”. People are wiser than their politicians realise.

Historically, egalitarians have believed that an expanding GDP, if not essential to increased equality, made its extension easier. The Spirit Level contends that many developed nations “have got to the end of what economic growth can do for the quality of life”. Certainly econom­ic growth is not desirable per se and, whatever its purposes and results, it is likely to endanger the environment. The evidence suggests more and more people have abandoned the idea that fulfilment consists in acquiring more and more consumer durables and portable property.

The Spirit Level, not surprisingly, tells us that as prosperity increases, “further rises in income count for less and less”. That is, incidentally, the utilitarian case for greater equality. A pound has greater value to the poor than to the rich. Luxury goods and services, essentially the product of competitive relationships, are losing their allure; instead – on the Wilkinson-Pickett evidence – a sense of community and the reassurance of friendship are becoming the essential features of a contented existence. But surely there is a case for economic growth when its fruits are used, through redistribution, to create greater equality? If the growth of GDP in Britain doubled, surely we could use the increment to build affordable housing, or sink wells in Africa?

The Wilkinson-Pickett answer to that question is complicated by their attitude to averages and state power. The book begins with the explanation that “economic growth and increase in average incomes have not contributed much to well-being in rich countries”. Nobody who understood the nature of averages thought they had. The rich got richer and therefore increased the mean, though probably not the median, income without affecting the living standards of the poor. That is why it is necessary for governments to intervene in the market economy – which, by its nature, extends income differentials – and redistribute wealth.

Yet The Spirit Level either believes in small government or despairs of politicians ever doing the right thing. The pessimism is understandable, if not justified, when Wilkinson-Pickett’s statistics show that income inequality in Britain and the US is now nearly 40 per cent greater than it was in the 1970s. So, the authors state: “Rather than simply waiting for the government to do it for us, we have to start making [the more equal society] in our lives and institutions straight away.” They are correct in saying that the two approaches are not mutually exclusive, but it may take longer to achieve a moral osmosis than to re-establish ideological politics.

No one can doubt that “mainstream politics . . . has abandoned the attempt to provide a shared vision capable of inspiring us to create a better society”. But mainstream politics can change, and the change should come about now. The old acquisitive order has failed – even by its own standards. Unless progressive politicians are stupid as well as craven they will seize the moment to argue for the egalitarian alternative. The importance of The Spirit Level is that, together with Richard Layard’s Happiness, it provides a vital part of the intellectual manifesto on which the battle for a better society can be fought.

A dissenting point of view from The Spiked Review of Books:
Distorting the spirit of equality

The Spirit Level, a new book on why equal societies are better than unequal ones, fancies itself in the tradition of the French Revolution. In truth, it turns equality from a political goal into a therapeutic imperative.

Anyone who follows politics or social science should be struck by what could be called the ‘Obama syndrome’. By this I mean the tendency to present what are at best mainstream ideas in grandiose, revolutionary terms. Like incredibly elaborate wrapping paper around a mundane gift, there is a huge gap between promise and reality.

Obama is merely the most prominent and oratorically gifted exponent of this approach. He did not originate it and it is certainly not unique to him. Many contemporary social thinkers present their ideas as in the tradition of the eighteenth-century Enlightenment or at least favouring radical social transformation (1). This begs the question of why, in an era when social possibilities are widely seen as being so limited, is revolutionary rhetoric so common?

The Spirit Level: Why Equal Societies Almost Always Do Better can be seen as a prominent addition to the apparently radical genre. Richard Wilkinson and Kate Pickett, both British epidemiologists, present themselves as advocates of one of the traditional key demands of socialist politics: equality. They even explicitly locate themselves in the tradition of the French Revolution of 1789, with its call for ‘liberty, equality and fraternity’. ‘We raise the same issues when we talk about community, social cohesion or solidarity’, they say (2).

The Spirit Level ends with a call for radical social change: ‘We must remember that it falls to our generation to make one of the biggest transformations in human history.’ (3) Its concluding sentence says: ‘The role of this book is to point out that greater equality is the material foundation on which better social relations are built.’ (4)

Wilkinson and Pickett also present themselves as avowedly political. They say they thought of calling the book ‘Evidence-based politics’ before settling for the catchier The Spirit Level (5). They have also set up an organisation, the Equality Trust, to help further their aims (6).

“There are still good reasons to believe that increasing prosperity could benefit richer countries”

The core of their argument is a particular psychological interpretation of what is known as the relative income hypothesis. This contends that what really matters to human welfare in developed societies is not absolute income but the level of inequality. A wide range of statistical indicators – including on mental health, physical health, educational performance, violence and social mobility – are better in more equal societies. In broad terms, this leads to the conclusion that more equal societies, such as the Scandinavian countries and Japan, are better countries to live in than places with high inequality, such as America, Britain and Portugal. They draw similar conclusions from the data on American states, favouring those that are more equal (such as New Hampshire, Minnesota, North Dakota and Vermont) over those that are particularly unequal (Alabama, Louisiana and Mississippi). The only key indicator which is generally worse in more equal societies is suicide (7).

The authors are relatively relaxed about how greater equality is achieved. Scandinavian countries emphasise a redistributionist welfare system which taxes the rich relatively heavily and provides extensive social benefits to its citizens. Japan, in contrast, has narrower pay differentials than most other developed nations. Either way, Wilkinson and Pickett argue, the desirable goal of greater equality is achieved.

The Spirit Level is squarely in the tradition of growth scepticism: indirectly calling into question the benefits of economic growth (8). It argues: ‘Economic growth, for so long the great engine of progress, has, in the rich countries, largely finished its work. Not only have measures of wellbeing and happiness ceased to rise with economic growth but, as affluent societies have grown richer, there have been long-term rises in rates of anxiety, depression and numerous other social problems. The populations of the rich countries have got to the end of a long historical journey.’ (9) In an earlier influential work Wilkinson went even further by arguing that the drive to maximise consumption could be seen as akin to mental illness (10).

An important caveat is that the two authors still concede that economic growth can benefit poorer countries. But once they are sufficiently wealthy to have passed the ‘epidemiological transition’ – the point at which chronic conditions such as heart disease and cancer replace infections as the main cause of death – they argue there are few benefits to economic growth. In their view there is little to be gained from moving from, say, Greek income levels to those in America. Indeed in many respects America is seen as having some of the most severe social problems in the developed world.

Let us assume for a moment that the relative income hypothesis is correct, and that human welfare in developed countries depends on levels of inequality rather than absolute income. It is still not clear that their sweeping conclusion that economic growth has done its job would follow.

There are still good reasons to believe that increasing prosperity could benefit richer countries and indeed could be vital in overcoming challenges facing humanity. Take climate change as an example. Wilkinson and Pickett make the common error of assuming that the challenge of climate change means that humans must curb their consumption. They even argue it is ‘fortunate’ that this conclusion chimes with their own argument about equality (11). But in reality the opposite is true. Dealing with climate change is likely to demand a large increase in the amount of resources available to humanity. Building a clean energy infrastructure capable of providing plentiful, cheap energy to the whole of humanity will be a costly operation (12). Adapting to the effects of climate change, for example by building modern flood defences, also looks set to be expensive. No doubt the challenge can be met with human ingenuity but it will demand more resources rather than fewer.

“Infant mortality in the developed countries is so low it is hard to see it getting substantially lower”

Similarly there is no reason why an ageing population should constitute a ‘demographic problem’. But a precondition for giving the growing number of elderly dependants a decent standard of living is more productive economies. Economic growth is the key to providing sufficient resources for everyone, including those who are not able to work for whatever reason.

The poverty of most of the world’s people also still poses an enormous challenge. Figures from the World Bank show that almost half the population of developing countries, or 2.5billion people, still live on less than the meagre level of $2 a day (13). Wilkinson and Pickett concede they could do with more prosperity but it is hard to conceive how this can be achieved without growth in the developed countries, too. On the contrary, the global economic downturn that started in America in 2008 has quickly spread to hit the economies of the developing world.

So the existence of inequality in the richer countries does not constitute an argument against economic growth. But it could still be the case that the relative income hypothesis is true in its own terms: that inequality is the key barrier to individual human welfare rather than absolute income. Here the evidence is mixed.

It is certainly meaningful to talk about an epidemiological transition. Infant mortality in the developed countries is so low it is hard to see it getting substantially lower. Children in the developed world are mercifully unlikely to die of such infectious diseases as AIDS, cholera, malaria, tuberculosis or typhoid. However, even Wilkinson and Pickett acknowledge that life expectancy in the rich countries is rising by, on average, about two to three years every decade (14). In their view this is unrelated to economic growth but it is hard to conceive of an alternative explanation to rising affluence or associated improvements in medicine and technology; the fundamental workings of the human body are not changing so rapidly.

Some experts have also argued that the relative income hypothesis is a ‘statistical artefact’ (15). By this they mean that the statistics used by the likes of Wilkinson and Pickett provide a misleading impression of demographic trends. For example, in unequal societies there tend to be more people who are poor, at least by the standards of the developed world. But Wilkinson and Pickett counter that the effects are too great to be explained by poverty alone (16).

The blurring together of objective and subjective problems raises other questions. Factors such as infant mortality, life expectancy and working hours are different from questions such as happiness or mental illness. The Spirit Level starts with the well-worn observation that there is a ‘paradox’ of ‘human material and technical achievement’ on one side coexisting with anxiety and mental illness on the other (17). Yet it is not clear why the distance between prosperity and subjective feelings should be seen as so paradoxical. The reasons why humans can feel unhappy or even mentally ill are complex. Prosperity is a necessary condition for individuals to lead a full life but it is not a panacea for all their problems.

“Early socialists saw scarcity as an evil which had to be overcome”

To their credit Wilkinson and Pickett are aware of the need to distinguish between correlation and causation. The fact that many social problems are prevalent in areas of high levels of inequality does not prove a causal relationship between the two. However, the arguments The Spirit Level uses to explain the damaging effects of inequality are open to question. One way it does this is by drawing parallels between human behaviour and that of primates. Despite acknowledging the need for ‘caution’ in extrapolating from primates to humans, the book explains how status levels affect the amounts of such chemicals as dopamine and serotonin in the human brain (18). From this observation they draw the conclusion that inequality could cause mental illness in humans.

Such extrapolation from primates to humans is entirely illegitimate. Although primates may share much of their anatomy and physiology with humans, they are fundamentally different creatures. As Helene Guldberg recently argued on spiked, humans are a vastly more sophisticated species (see Chimps are like humans? Stop monkeying around). The definition of what constitutes mental illness has also widened enormously in recent years (19). A better line of investigation would be to consider what it is about contemporary societies that is increasingly encouraging people to define their problems in therapeutic terms.

Although it is important to grapple with the details of the relative income hypothesis, it is far from the whole story. The bigger picture is about how the meaning of the demand for equality has fundamentally changed over the years. The concern of the thinkers of the Enlightenment and the exponents of the French Revolution had little to do with the measurement of inequality. It was, on the contrary, about achieving social and economic progress so that humanity could fulfil its true potential. The famous opening of Rousseau’s Social Contract (1762), ‘Man is born free, yet everywhere he is in chains’, is an expression of this belief. Through the application of science and reason the Enlightenment thinkers believed it would be possible to achieve a more equal and freer society.

The supporters of the French Revolution and early socialists saw such developments in political terms, rather than, as today, in therapeutic terms. They believed that the disenfranchised should fight collectively to achieve a better life for all. Social conflict was widely seen as necessary to achieve the desirable goal of a better, more productive society. Scarcity was seen as an evil which had to be overcome.

Such an approach is a world away from the technocratic and elitist approach of academics such as Wilkinson and Pickett. They see a society rife with anxiety and mental illness, which needs expert intervention to solve its problems. Their diagnosis comes from huge databases of statistics crunched with the help of statistical packages such as Excel. For them, the ultimate goal of policy is to change people’s behaviour rather than fight to achieve a better world. It represents an elitist drive for therapeutic intervention rather than a popular struggle for social change.

In this approach, they follow many of the most prominent social thinkers, particularly economists, in Britain today. All of them follow what could be called an ‘evidence-based’ approach in which policy is seen as directly flowing from the data. Michael Marmot, a one-time collaborator with Wilkinson, has played a key role in popularising this approach in relation to a key World Health Organisation report (20). Nicholas Stern, another economist, has adapted the approach to climate change (21). Paul Collier has examined global poverty and ‘the bottom billion’ in relation to cost-benefit analysis (22). Richard Layard has applied it to happiness and policy towards children (23).

The only reason such people can get away with combining their technocratic approach with revolutionary slogans is that the latter have been denuded of their original meaning. It is precisely because social change is seen as so unlikely that they can espouse such radical concepts while propounding a fundamentally conservative approach. Equality, in their hands, does not mean a popular struggle to achieve the human potential but is more akin to equal therapy for all. Social transformation, from their perspective, means constructing institutions to intervene in every aspect of our lives.

Now more than ever it would be a mistake to judge people by their superficial rhetoric. Those who genuinely want to construct a new world will have to develop a new vocabulary to express their goals.

Daniel Ben-Ami is a journalist and author based in London. Visit his website here.

The Spirit Level: Why More Equal Societies Almost Always Do Better, by Richard Wilkinson and Kate Pickett, is published by Allen Lane. (Buy this book from Amazon(UK).)

(1) Prominent exponents of this highfalutin approach include Richard Layard, Jeffrey Sachs, Amartya Sen and Joseph Stiglitz.

(2) Spirit Level, p45

(3) Spirit Level, p265

(4) Spirit Level, p265

(5) Spirit Level, pix.

(6) The Equality Trust website can be found here.

(7) Spirit Level, p175

(8) See Whose afraid of economic growth?, by Daniel Ben-Ami, 4 May 2006

(9) Spirit Level, p5-6

(10) Unhealthy Societies: The Afflictions of Inequality, Richard Wilkinson, Routledge, 1996, p211

(11) Spirit Level, p215

(12) See Energise!, by James Woudhuysen and Joe Kaplinsky, Beautiful Books, 2009

(13) Figures from the World Bank’s 2008 World Development Indicators: poverty data supplement (PDF).

(14) Spirit Level, p6

(15) See, for example, How much of the relation between population mortality and unequal distribution of income is a statistical artefact?, BMJ, 31 January 1998

(16) Spirit Level, p108

(17) Spirit Level, p3

(18) Spirit Level, p72

(19) See Down with ‘enoughism’, by Daniel Ben-Ami, spiked review of books, February 2008.

(20) Commission on Social Determinants of Health, Final Report, 2009

(21) The full 2006 Stern Review on the economics of climate change can be found here.

(22) See The Bottom Billion: Why the Poorest Countries are Failing and What Can be Done About It, by Paul Collier, Oxford University Press, 2007.

(23) See, for example, A Good Childhood, the Children’s Society.

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