‘We Are Not Taxing the Very Wealthy Enough’: Runaway Inequality About to Get Worse
The United States' astronomical levels of economic inequality are poised to become further entrenched in the coming years.
British epidemiologists Richard Wilkinson and Kate Pickett have changed how the world thinks about economic inequality — and they have a wealth of new insights to share.
Imagine if we compared the world’s major developed nations on most all the yardsticks that define social health and decency, everything from average life expectancy and levels of trust to the incidence of teenage pregnancies and drug addiction. Suppose we also ranked these same nations by their level of income inequality. What would we see?
We would see, the British epidemiologists Richard Wilkinson and Kate Pickett have helped the world realize, that relatively equal nations far outperform — on nearly every measure that matters — nations where income and wealth concentrate at the top.
Wilkinson and Pickett thrust this core insight onto the global public policy center stage with their landmark 2009 book, The Spirit Level: Why Greater Equality Makes Us Stronger. People in more unequal developed nations, The Spirit Level revealed, can be anywhere from two to ten times more likely than people in more equal nations to be obese or get murdered, to mistrust others or have a pregnant teen daughter, to become a drug addict or stick in poverty.
Wilkinson and Pickett are now completing a new book, due out in 2016, and Sam Pizzigati, the editor of the Institute for Policy Studies inequality newsletter Too Much, caught up with the pair at their UK home outside the city of York. The resulting discussion, edited here for publication, explores their Spirit Level experience — and the egalitarian work they see as essential ahead.
Too Much: We’re gone over five years since The Spirit Level first appeared. Can you do some arithmetic for us? Copies sold?
Richard Wilkinson: With 24 foreign editions now, we don’t know for sure. We’re probably close to 300,000, for all the editions together.
Too Much: What did you expect?
Kate Pickett: Not that!
Wilkinson: Our publisher was originally a bit doubtful about the book. He told us a serious nonfiction work rarely sells more than 10,000 in its lifetime.[pullquote]We have vested interests on the right who simply did not like our conclusion.[/pullquote]
Pickett: Richard Layard, the author of Happiness, which did very well as a serious nonfiction book, had told us to be prepared, when the book comes out, for your life to be completely chaotic for about two weeks. Well, it’s been completely chaotic for five years now. It just hasn’t let up.
Wilkinson: Each of us gets maybe a speaking invitation a day.
Pickett: And from all over the world: charities, political groups, activists, academic conferences, the OECD, the United Nations, the EU. Sometimes we’ve had to get up in the middle of the night and go to the university to do a video conference with Australia or New Zealand or some such.
Too Much: What do you think people in your audiences find most difficult to accept — or understand — in what you’re talking about?
Pickett: Actually, I don’t think people find what we’re talking about all that difficult at all. I think they find that what we’re saying, about the impact of inequality, is intuitively making sense of their own experiences. So the most common reaction we see among audiences when we’re talking is nodding.
Too Much: And the skeptics?
Wilkinson: I think the difficulty for people who are skeptical is the idea that so many quite different problems — drug abuse and imprisonment and teenage births and so on — can be affected by this one thing, income inequality.
And I try and make sense of that by saying, look, these are all problems that have social gradients making them more common at the bottom of society. So we know all these problems are related to social status, and in a way, all we’re saying is that problems related to social status get bigger when inequality — and status differences — increase. The only surprise is that as inequality increases, these problems get more common all the way across society, not just among the poor.[pullquote]Attacking the idea that inequality is damaging sounds increasingly obtuse. [/pullquote]
Now some critics talk as though we dreamt all this up. They don’t realize that the first papers on income inequality and population health came out in the late ’70s. There have been 35 years of research on this.
Pickett: Hundreds of papers.
Wilkinson: Hundreds, yes – from researchers all round the world. Yet some people suggest that Kate and I cherry-picked the data we presented. Actually, it was quite the opposite. We had an absolute rule that if our source — the OECD or the World Health Organization or the U.S. Census — had data on a problem for a country or a state, then that data had to go into our analysis, whatever we think of it.
So this criticism that we cherry-picked our data to fit our thesis is just silly, a display of ignorance.
Too Much: But it’s a well-funded silliness.
Pickett: Yes, we have vested interests on the right who simply did not like our conclusion. So they tried to tear it apart statistically. They would do things like remove the Scandinavian countries from the analysis. They’re odd, they said. Well, they’re not odd. They’re real countries.
Too Much: But these right-wing attacks are fading somewhat?
Pickett: Very much so, perhaps because we now have world leaders talking about inequality all the time: Obama, UN Secretary-General Ban Ki-moon, the International Monetary Fund’s Christine Lagarde, the Pope. Attacking the idea that inequality is damaging sounds increasingly obtuse.
Economists have also turned a great deal of attention to inequality since the global financial crisis. They’re now talking about how bad inequality is for economic stability and growth. And these are Nobel Prize-winning economists. So the evidence that there are high costs to inequality gets more and more substantial, more and more solid and robust.[pullquote]If you look in one country after another, you see inequality dropping when the proportion of the working population in trade unions rises.[/pullquote]
Wilkinson: Yet the critics remain, and I think one of the most interesting things is what motivates them.
I sometimes talk about how everyone – regardless of politics — wants a society with better health, lower rates of mental illness, less violence, stronger community life, higher standards of child wellbeing. But the idea that you can get a bit closer to these goals by reducing inequality, some people find that an absolutely monstrous suggestion.
You know the American book, The Merchants of Doubt by Naomi Oreskes and Erik Conway? It’s about the attempts to rubbish climate science and the research on the harmful impacts of pesticides and the links between smoking and ill health. The book looks at who the people behind these attempts are, where their funding comes from, and what their motivation is.
The book makes the point that these people are basically neoliberalist free market fundamentalists. And anything that seems to be an encroachment on the free market, they feel, must be attacked. A previous publication of one of our right-wing critics was an attempt to rubbish all the evidence on the health effects of second-hand smoke. So I do think that’s what this is about. They’re trying to protect the free market.
Too Much: Looking back on The Spirit Level, are there things you would change or emphasize more?
Wilkinson: Yes, we have about 400 references in the book, but I wish we’d made it clearer that there is a great deal of more sophisticated and supportive research out there in the journals.
Pickett: We were trying to keep the book simple. No equations, no ”p-values,” no confidence intervals — because people don’t understand all that. We were really trying to make things clear for people, and in doing that we sacrificed presenting some of the more complex underpinning.
The radical statistics society of Great Britain actually accused us of “dumbing down” —
Wilkinson: — because we didn’t put in the “p-values” and correlation coefficients and so on.[pullquote]If we are going to get a period of perhaps more radical progressive views, it is really essential that this time we make more structural changes.[/pullquote]
Pickett: My response to that was they are academic statisticians. They can read the original academic research papers, ours and other people’s. This book, The Spirit Level, wasn’t written for them.
Too Much: The charts that make up the visual core of The Spirit Level, the scattergrams that show how incidences of social problems increase as inequality increases, gain incredible power as they multiply throughout the book. Do you have any sense that these insights are filtering into the classes students take?
Pickett: All the data that our charts reflect are available through the Equality Trust web site. We know that lecturers and professors are downloading the data.
Wilkinson: The data we use turn out to be very good for people teaching basic statistics. Students have here both manageable amounts of data and interesting variables. It’s easy for them to run the same sort of analyses on inequality and social problems that we ran. Professors write in to us and say they’ve done that with their classes — and that they’re amazed to get the same results as we did!
Pickett: What a relief to me! As the one responsible for producing those graphs, I was constantly checking everything and getting really really worried about what if I’ve made a mistake.
Too Much: In The Spirit Level, you use the ratio between a society’s richest and poorest income quintiles —the top and bottom 20 percents — as the prime yardstick for measuring income inequality. Income data globally have come most commonly by quintile. As data collection gets more sophisticated and we get sharper breakdowns of income within the top quintile, do you think you will see any different results?
Pickett: In the book, we use the 20-20 ratio because it’s easy to understand. But for the U.S. states we used the Gini coefficient because that’s what the U.S. Census provides. Most of the time it doesn’t matter much whether you use Gini, the 90-10 ratio, or the 80-20. And there are other measures as well.
What we’ve wanted to do for a long time, actually, is to have some funding for students to look at different outcomes across a whole range of measures, to see whether for some social problems it’s inequality at the bottom that matters more or if it’s at the top or if it doesn’t matter. I think there’s quite a lot of work that could be done there.[pullquote]The data available keep getting better and better.[/pullquote]
Wilkinson: About 25 years ago, I did a paper that looked at the share of income going to the bottom decile, the bottom two deciles, the bottom three, four, five, six. The correlations between population ill health and inequality – for just the few countries I had data for at the time — seemed to be strongest with the share of all income going to the bottom seven deciles, as if it was a matter of allocation between the top 30 and the bottom 70. But then I had data from so few countries that I couldn’t be confident. It was just a possible pointer.
Too Much: So the potential for further research there is huge?
Pickett: Oh, sure. And the data available keep getting better and better. For a long time there were very few countries with internationally comparable income inequality data covering substantial periods of time. That’s improving. Wealth inequality data for different countries is getting better too.
But the kind of new research that’s been most helpful has been coming from psychology.
In The Spirit Level, we have all these correlations between inequality and social problems, and we have theories and hypotheses about what is driving these correlations. But we didn’t know then whether or not the drivers we hypothesized — things like status anxiety — were actually higher in more unequal countries. Now those kinds of data are being used increasingly in psychological research. So, for instance, there are papers looking at levels of social solidarity in relation to inequality in different European countries.
Wilkinson: Solidarity in terms of whether people are kind and helpful toward each other, whether people are willing to help old people or their neighbors or the disabled.
Too Much: Your upcoming new book, which I hear has the working title, Crisis of Confidence, will go into much of this new psychological research?
Wilkinson: Yes. I worry that many people think that these things we’ve been writing about — like violence or poor educational performance — all go on out there in “society” and have nothing to do with what they think matters most to them, like their own personal and emotional ups and downs and the well-being of their friends and family. So I’m rather keen to show how inequality gets into our intimate worlds.
Pickett: We’re aiming for a different sort of audience with this new book, the people who don’t think they’re interested in politics or society — people who would never pick up a book like The Spirit Level because it doesn’t seem to be speaking to their interests, but who might buy self-help books and try to understand their own relationships.[pullquote]There’re so many people today suffering from low self-esteem, social anxiety, and depression, who conceive of it all as their own fault.[/pullquote]
Wilkinson: There’re so many people today suffering from low self-esteem, social anxiety, and depression, who conceive of it all as their own fault — a matter of their own private vulnerability. Or they see these anxieties as just part of the human condition. They don’t understand how social structures affect these anxieties, the lack of confidence, and low self-esteem that blight so many lives.
Pickett: The whole field of social epidemiology has uncovered how important our social lives are for our health and well-being. But that’s still not an understanding really current in the public mind — or even among health professionals.
We wrote a New York Times article that discussed a study that showed a higher incidence of schizophrenia in the more unequal countries. A U.S. psychiatrist wrote to me and asked if I could I send him the reference to the study. He said he really needed to read the study because it threatened to destroy the entire basis of what he thought about schizophrenia. In his mind, it was all a matter of genetics. So the idea that there might be some social environmental impact involved had passed him by, although he was an academic researcher in schizophrenia.
Too Much: In the U.S., many people assume we must be doing well in any international ranking of health outcomes because we have all this advanced medical knowledge and technology.
Pickett: Dr. Stephen Bezruchka at the University of Washington has a very interesting exercise on this for first-year medical students. Students in his class on public health have to write a speech for the President on why the United States has the best health in the world – backed up with statistics.
The students go off and start their research and are then shocked to find that health outcomes in the United States are actually worse than in other developed countries — nearer the level of much poorer countries, including Cuba. It’s a real eye-opener for them.
Too Much: In the U.S. debate over President Obama’s health care reform proposals, we had no sign of what you talk about in The Spirit Level, no understanding that health is related to the social relations around us, the level of inequality. It was all a matter of if you have insurance, you’ll be healthy. If you don’t have insurance, you won’t be healthy. So the paradigm hasn’t shifted yet in the United States. What do you think it will take to shift that paradigm?
Wilkinson: I know that understanding comes a bit easier here in the UK because people, the vast majority, are all getting the same medical care. The sociologist Peter Townsend did some very creative work that recognized this reality. His idea was to take different cities, like Newcastle, and show the health inequalities between one neighborhood and another. And the people and local media in Newcastle knew that everyone in these neighborhoods used the same medical services. Yet rich and poor neighborhoods had very different average life expectancies. People knew the reason wasn’t differences in medical care.[pullquote]It now looks like the Sustainable Development goals that the UN is producing will have inequality targets.[/pullquote]
Pickett: Researchers have produced some nice images around that kind of idea. There’s a map of the London tube system where you can see life expectancy dropping as you move, station by station, along the Central line, and they’ve done the same for a bus route in Sheffield
Wilkinson: People in public health here were influenced by a book that came out in the early 1970s, An Introduction to Social Medicine, by Thomas McKeown and Charles Lowe. One of the most influential things they did was to look at the decline in death rates since the late 19th century, basically the 20th century up until the 1970s. They looked at death rates from diphtheria, measles, whooping cough, and other infectious diseases that had been major killers in the first half of the century. These rates all declined rapidly as the century moved on.
The book had graphs that tracked the timeline for death rates for each disease, with arrows indicating when each disease’s cause was first identified, another when any effective treatment was developed, and another when an immunization was developed.
And one graph after another showed that almost all of the decline in death rates from these diseases had nothing to do with medicine. All those medical advances actually came far too late to explain the main decline in death rates. And this knowledge is what everyone in UK epidemiology and public health was brought up on. So things pointed to socio-economic factors — and quite strongly. And interestingly, the explanation was not primarily clean water and sewerage because most of these diseases are airborne.
Too Much: As you look back on the five-plus years of The Spirit Level, what makes you feel most proud?
Pickett: I feel most proud that Richard’s decades of research, and his deep thinking about inequality, is out there now and recognized, because he worked on that for an awfully long time. He faced lots of criticism over the years. But he stuck with it. He was tenacious.
Wilkinson: This is Kate being very generous. You can never tell how much of the demand for our book is because of a rising interest in inequality and how much it contributed to that rising interest in inequality. But it has been wonderful to see the growth of interest.
I think in terms of political pendulum, which moved to the right for decades, from sometime in the late 1970s, and then, with the financial crash, sort of slowed, stopped, and began to slowly swing back. And now it’s moving back at an increasing pace. We’ve seen in the British Social Attitudes Survey a growth in the proportion of the population that think the income differences are too big.
Pickett: And it now looks like the Sustainable Development goals that the UN is producing will have inequality targets and whatever replaces the millennium development goals will have targets, too. This will offer a framework for making sure governments monitor inequality, keep an eye on it, and have to report trends.
Wilkinson: But there’s an important point I’d like to make about the major changes in inequality. The basic picture of changes in inequality during the 20th century in most rich countries is that there was high inequality in the 1920s, then declining inequality from sometime in the 1930s, which continued through the middle of the century until it petered out in the 1970s. Then, from around 1980, you get the modern rise in inequality. That trajectory I am absolutely sure reflects the strengthening and then the weakening of the labor movement, plus the fear of communism and the strength of the social democratic movement.
If you look in one country after another, you see inequality dropping when the proportion of the working population in trade unions rises and inequality rising when the union population is dropping. It really is an extraordinary fit.
I don’t think it’s simply that trade unions make such a huge difference to the wages of their members, though I’m sure they make an important difference. But trade union membership also provides an indicator of the strength of the countervailing voice of the whole labor movement in society, offering a different perspective.
As soon as this countervailing voice weakened, suddenly inequality shoots up again and we lost the progress we made. I think that means that if it’s right to think about the swinging of the political pendulum, and if we are going to get a period of perhaps more radical progressive views, it is really essential that this time we make more structural changes. If the political tide turns again, we don’t want it to be so easy for progressive changes to be reversed.
That’s why I emphasize the importance of forging real economic democracy. If you just reduce inequality with a bit of redistribution through taxes and safety-net benefits, then the first government that doesn’t like that redistribution simply undoes it all.
Unfamiliar with the work of Richard Wilkinson and Kate Pickett? You can find a brief and timely new introduction to their thought in a downloadable Fabian Society pamphlet, A Convenient Truth, published this past October.
Sam Pizzigati edits Too Much, the Institute for Policy Studies online monthly on excess and inequality. His latest book: The Rich Don’t Always Win: The Forgotten Triumph over Plutocracy that Created the American Middle Class (Seven Stories Press).