| The Ottawa Citizen
Wednesday, May 07, 2008, By Dan Gardner. ©The Ottawa Citizen. |
||
|
Why we care about how the other guy's doing. Contrary to what you may have read or heard since Friday, the poor are not getting poorer. It is true that over the last 25 years, as Statistics Canada reported, earnings "declined for those at the bottom." But "earnings" does not include investment income, retirement income, welfare, or any other government transfer. See the problem? A wealthy boomer who retires will experience a crash in "earnings," but he certainly won't be found at a homeless shelter any time soon. A better measure of how people are doing is to include all the other sources of wealth aside from earnings. That's "income." And the most meaningful way to measure income is to look at families, not individuals, because the overwhelming majority of people live in some sort of family unit that pools resources. Overall, median family income rose 11 per cent since 1980. But StatsCan didn't break this down into income groups so Terence Corcoran, a columnist with the National Post, asked them to do so. Result? "The poor are getting richer," Corcoran wrote. Between 1980 and 2005, the bottom 20 per cent of families saw their incomes rise 15 per cent. So is everything tickity-boo? Corcoran and other conservative pundits seem to think so. "Nobody would argue that Canada is perfect," Corcoran wrote, "... but this StatsCan report is actually a strong reflection of an economy that has lifted all boats that could be lifted." Notably missing from this analysis is a key word: inequality. As Corcoran himself reported, incomes among the top 20 per cent of families rose 23 per cent between 1980 and 2005. With the bottom 20 per cent seeing growth of only 15 per cent, the gap between rich and poor families grew steadily over the last quarter century.
|
Does that matter? Many people would shrug. Those at the bottom are better off. Surely that's what counts. The fact that incomes at the top grew faster doesn't change that. Relative income -- how much do I make compared to others -- is something only the envious care about. As long as the poor keep improving their lot, growing inequality is irrelevant. I used to think that argument made a lot of sense. If millionaires become billionaires -- by fair dealing -- it doesn't change my circumstances or those of anyone else. Why should I care that the gap is growing? Rationally, I shouldn't. But I do. Everyone does, whether they know it or not. That's just the nature of the species. Homo sapiens has existed for roughly two million years and in almost all that vast span of time, we lived as nomadic hunter-gatherers in small bands of 20 or 30. That Paleolithic world is what evolutionary psychologists call the "environment of evolutionary adaptation" -- it is the world that shaped our bodies and our brains. It is, in other words, the environment that made us what we are today. In that world, survival depended on co-operation. And so we are profoundly social animals. But beyond mere survival, what matters in evolutionary terms is reproduction. Those who have children pass on their traits. Those who don't, don't. So the more children one has, the more successful one is. And who in the ancient world had the most children? Males with high social status. They had the most resources and therefore attracted the most mates and had the most offspring. (Today, the link between sex and reproduction has been severed, but it is still true that males with high social status have the most sex.) As a result of this elementary truth, competition for social status, particularly among males, became a universal human trait. Our place on the ladder matters deeply to us, whether we consciously think about it or not.
|
"Where you stand in the social hierarchy is intimately related to your chances of getting ill, and your length of life," writes Sir Michael Marmot, the British epidemiologist whose research on the health effects of social status is transforming the whole field of public health. In Marmot's most famous study, his team looked at Britain's highly stratified civil service and found a clear correlation between status and health that remained even after accounting for high rates of smoking and other unhealthy behaviours among those further down the ladder. The conclusion is clear: In a very unequal environment, low social status can kill. Other researchers have found a similar correlation with happiness. Job satisfaction has less to do with the salary we are paid, for example, than with how our salaries compare to those of co-workers. Similarly, people are happier if they live in a neighbourhood where others have about the same income than they do surrounded by wealthier neighbours. What all this suggests is that growing inequality is a serious threat. And inequality can grow even if those at the bottom are not falling behind in absolute terms -- which is precisely what's happening in Canada. A similar trend is playing out in the United States, although the gap is bigger and growing more rapidly. As a result, argues, Robert H. Frank, a Cornell economist, in Falling Behind: Rising Inequality Harms the Middle Class, the American middle class struggles to match a level of consumption which is set by those at the top -- a level which is increasingly out of reach -- and that has led Americans to work longer, save less, and borrow more. That's a society on it's way to a nervous breakdown. Recent research also shows that the growing gap in American incomes is matched by a growing gap in life expectancy. At the beginning of the 1980s, the wealthy could expect to live 2.8 years longer than the poor; 20 years later, that gap was 4.5 years and researchers believe it continues to grow. Differences in lifestyle and medical care are undoubtedly responsible for a portion of that gap but Sir Michael Marmot's research suggests some of the blame lies with income trends. Inequality is bad for people. It's that simple. And, with inequality growing in Canada, that scary. You can contact Dan Gardner at the Ottawa Citizen. |
|
Copyright © 2005 Dan Gardner |