Month: February 2022

15 February 2022

Dr. Trevor Hancock

698 words

Alongside an ecologically unsustainable economic system and way of life, the world faces a second grand challenge; a socially unsustainable level of inequality within and between nations and communities. High levels of inequality are incompatible with a Well-being society, which the World Health Organization’s Geneva Charter for Well-being defines as one with equitable health.

Health inequalities are greatly influenced by the level of inequality in society, as noted by Richard Wilkinson and Kate Pickett in their 2009 book ‘The Spirit Level’. They showed clearly that in high-income countries, for a range of health and social outcomes, it is not the level of GDP that affects how well they do, but the degree of inequality within the country; the more unequal they are, the worse they perform.

Inequality is corrosive: As French philosopher Raymond Aron has said: “When inequality becomes too great, the idea of community becomes impossible.” That is also true globally: “bonds across countries do not work when bonds within them are broken”, noted the UN’s recent report ‘Our Common Agenda’.

Which brings me to the World Inequality Report 2022, released in December 2021. The report is published by the World Inequality Lab, based in France, whose major funders include the European Research Council, the Paris School of Economics, the Ford Foundation and a number of universities and research centers.   

The report focuses on several aspects of inequality, including both income and wealth inequality as well as gender inequality; unusually, it also focuses on inequalities in carbon emissions, which of course ties inequality directly back to an unsustainable way of life, especially when much of the world seems to want to emulate the ‘lifestyle of the rich and famous’.

Globally, the richest 10 percent of the population takes 52 percent of global income and holds 76 percent of total wealth. Meanwhile, the poorest half of the population earns 8.5 percent of global income, while holding a mere 2 percent of global wealth.

Moreover, the report notes “Income and wealth inequalities have been on the rise nearly everywhere since the 1980s, following a series of deregulation and liberalization programs” – in other words, neoliberalism. The authors also point out that “wealth is a major source of future economic gains”, so this increasing concentration of wealth “presages further increases in inequality.”

Indeed, if we look at the top 1 percent globally, we see an extreme concentration of wealth and economic power: “between 1995 and 2021, the top 1 percent captured 38 percent of the global increment in wealth, while the bottom 50 percent captured a frightening [that is to say, frighteningly low] 2 percent.”

This inequality is also reflected in the share of carbon emissions: “the top 10 percent of emitters are responsible for close to 50 percent of all emissions, while the bottom 50 percent produce 12 percent of the total.” More dramatically, the top 10 percent in North America not only emit more than seven times the emissions of the bottom half, per person, they also emit more than twice the amount of the top 10 percent in Europe.

The situation for Canada is only marginally better. The top 10 percent took 40 percent of income and held 57 percent of wealth, while the bottom 50 percent took a mere 15 percent of all income and held not quite 6 percent of total wealth. At the very top, the top 1 percent took almost 15 percent of all income and held one quarter of all wealth.

Canada’s carbon emissions are telling: While the bottom half in 2019 emitted 10 tonnes per year, the top 10 percent emitted 60 tonnes, and the top 1 percent an astonishing 190 tonnes, ten times the national average. Even worse, while the bottom 90 percent have reduced their emissions by about 4 tonnes per person, the top 10 percent actually increased their emissions by the same amount!

But perhaps the most important statement in the report is this: “Inequality is not  inevitable, it is a political choice.” So it does not have to be this way. Next week, I will explore some of the policy responses needed to quell this obscene increase in inequality and the resultant extreme imbalance in power and influence.

© Trevor Hancock, 2022

thancock@uvic.ca

Dr. Trevor Hancock is a retired professor and senior scholar at the

University of Victoria’s School of Public Health and Social Policy

Published as “When it comes to health, inequality is inevitable, but inequity isn’t”

Dr. Trevor Hancock

8 February 2022

701 words

The World Health Organization’s December 2021 Geneva Charter for Well-being expresses “the urgency of creating sustainable well-being societies, committed to achieving equitable health now and for future generations without breaching ecological limits.” So far, I have mostly focused on the need to stay within ecological boundaries and to create an economy that takes such boundaries into account, while still ensuring a social foundation for all.

Here I turn to the second key element of such a society: Equitable health. Equity refers not to equality in health but to fairness in creating the pathway to health. We will never have equality in health, if by that we mean equal levels of health throughout our lives, for a variety of reasons.

To begin with, there are genetic differences – we are not clones – and sex-based differences; as a man, I don’t experience all the risks of pregnancy and childbirth, or face the possibility of ovarian cancer, for example. Then we all have different formative experiences growing up in our families, among our peers and in our communities, which may be shaped by discrimination based on gender, race, income or other factors. On top of that we have different life experiences; some of us have tragic accidents or meet up with infectious diseases that others do not, and so on.

But one of the most important factors determining our health is our level of wealth and income and all that comes with that; the quality of our environment, housing and neighbourhoods, the quality and availability of education, health care and other services, the opportunities and privileges we get or the barriers and exclusions we face. It is in the area of these socio-economic and related inequalities that equity becomes important.

Both globally and within nations, health inequity – unfair and unjust inequality – is rooted in inequitable economic and social arrangements. We see it in higher mortality rates and lower life expectancy between rich and poor both within and between countries, as well as in inequalities in health between Indigenous and non-Indigenous people in Canada and many other countries. “Social injustice”, the 2008 final report of the World Health Organization’s Commission on the Social Determinants of Health stated, “is killing people on a grand scale”.

Health equity, then, means having equal opportunity, a fair chance to have good health and a good life; given that we will never have equal health, it also refers to inequalities that are considered socially acceptable. Addressing inequity often entails a hand-up of some sort, social support and affirmative action programs intended to level the playing field. And that is another key point about equity and inequity in health; while inequality rooted in genetic and other biological differences may not be remediable – we will always have inequality in those circumstances – inequity is or should be avoidable, preventable.

A classic illustration of an equitable response to inequality is the image of three children – tall, average height and short – trying to see over a wooden fence to watch a baseball game; only the tall child can see over the fence. If we have three boxes and treat the children equally by giving them each a box to stand on, the average size child can now see over too, but the short kid still can’t. To make it equitable, we have to give two boxes to the short child, one to the average height kid and none to the tall one; now all three can see. (In a final refinement of this image, if we replace the barrier of the wooden fence with a chain-link fence, all can see and no boxes are needed – the removal of systemic barriers for all.)

The World Inequality Report 2022, released in early December 2021, is directly relevant to the idea of equitable health in a Well-being society. Noting that “contemporary global inequalities are close to early 20th century levels” and that “inequality is a political choice, not an inevitability”, the authors stress that “addressing the challenges of the 21st century is not feasible without significant redistribution of income and wealth inequalities.”

This includes the challenge of creating Well-being societies that enjoy equitable health. So next week, I shall look in more depth at this important and troubling report.

© Trevor Hancock, 2022

thancock@uvic.ca

Dr. Trevor Hancock is a retired professor and senior scholar at the

University of Victoria’s School of Public Health and Social Policy

(Published as “GDP needs to be replaced with more meaningful indicators”)

Dr. Trevor Hancock

1 February 2022

700 words

Last week I described the growing global attention to the concept of a Well-being society and economy. The latter has already been the focus of work by several national governments. In particular, Aotearoa New Zealand was the first country in the world to develop and present a Wellbeing budget, as I noted in my June 9, 2019 column.

At that time Prime Minister Jacinda Ardern commented “while economic growth is important – and something we will continue to pursue – it alone does not guarantee improvements to our living standards”. This theme was taken up by the Finance Minister, who noted that instead of focusing on “a limited set of economic data”, with success defined by “a narrow range of indicators, like GDP growth”, this new approach measures success in line with New Zealanders’ values – “fairness, the protection of the environment, the strength of our communities”.

These themes have continued, with Budget 2021 “continuing to place the wellbeing of current and future generations of New Zealanders at the heart of everything we do”. The Budget starts by reporting on the wellbeing of New Zealanders, which “is underpinned by stocks of the four capitals as set out in the Treasury’s Living Standards Framework: human capital, natural capital, social capital, and financial and physical capital”.

Note that wealth is understood here in the same terms as is proposed by the UN and other important groups, in terms of inclusive wealth – it’s not just about the money.

Since then, several more governments have started down this path. An October 2021 update from the Wellbeing Economy Alliance (WEAll) notes “the Wellbeing Economy Governments (WEGo) group now consists of five key governments: Scotland, Finland, Iceland, Wales and New Zealand”. The update also mentions that both Canada and Norway have started some work on a wellbeing framework.

Here in Canada a start has been made by the federal government, which included a report, “Toward a Quality of Life Strategy”, in the April 2021 Budget papers. This was a result of the Mandate Letter for the Associate Minister of Finance directing them to “better incorporate quality of life measurements into government decision-making and budgeting, drawing on lessons from other jurisdictions such as New Zealand and Scotland.”

Gratifyingly, the Budget paper reports that public opinion research conducted by the Department of Finance in August 2020 (amidst the first wave of Covid) found that while just over half of Canadians “feel that stronger growth in Canada’s GDP is important to their day-to-day life”, more than 4 in 5 “feel that measures beyond economic growth” are important.

These other factors include “health and safety, access to education, access to clean water, time for extracurricular and leisure activities, life satisfaction, social connections, and equality of access to public services”, the Department noted.

So not surprisingly, “nearly three quarters (71%) of respondents feel it is important that the government move past solely considering traditional economic measurements like levels of economic growth, and also consider other factors like health, safety, and the environment when it makes decisions.” Clearly, the Canadian public is well ahead of the political and business elite when it comes to measuring progress and understanding what matters.

Of course, the government can also lean on and learn from many years of work on a Canadian Index of Wellbeing (CIW), now housed at the University of Waterloo. The Index creates a single number based on performance across eight domains of wellbeing and quality of life. Its most recent report, published in 2016, covered the period from 1994 to 2014. Over those 20 years, it found that while GDP grew 38 percent, the CIW only grew by 10 percent. Clearly GDP growth does not translate very well into improved quality of life.  

While the development by the federal government of a quality of life framework is a useful start, what now needs to happen is for the government to replace the GDP with these more meaningful indicators, and start producing proper Wellbeing budgets

As the recently established Wellbeing Economy Alliance for Canada notes, “A well-being economy depends on a re-imagination of societal purpose that enshrines what makes life worth living and a thriving planet.” That is the sort of society we must strive for.

© Trevor Hancock, 2022

thancock@uvic.ca

Dr. Trevor Hancock is a retired professor and senior scholar at the

University of Victoria’s School of Public Health and Social Policy

24 January 2022

Dr. Trevor Hancock

702 words

Last week I discussed the first of three actions that are needed in order to create a Well-being society, according to the World Health Organization’s (WHO) Geneva Charter for Wellbeing: Valuing, respecting and nurturing nature. This week I turn to the second: Design an equitable economy that serves human development within planetary and local ecological boundaries.

In the face of growing disquiet that our current economic system massively harms the Earth’s natural systems while creating excessive inequality and insecurity for many, there is growing interest in the idea of an economy that puts people and planet first. While long the focus of the work of ecological economics, such an approach to economics has been marginalised and largely ignored in mainstream economics, business operations and government policy until recently.

Instead, neo-liberal economics has become the orthodoxy, especially since the era of Margaret Thatcher and Ronald Reagan. Neo-liberal economics enshrines selfishness and greed as the driving forces of the economy, and material wealth, GDP growth and shareholder profit as the goals of a society where the economy is the centre of concern.

Impacts on people’s health and social wellbeing and on the environment that sustains them, whether locally or globally, are of secondary concern. In fact, they are considered ‘externalities’ and largely excluded from consideration “for no better reason than because we have made no provision for them in our economic models”, noted the respected ecological economist Herman Daly.

This leads to a fantasy economy, where GDP can grow both by selling tobacco and treating illnesses caused by tobacco; where profit can be made both by ignoring pollution regulations and by cleaning up the mess afterwards; where growth can continue even though we already exceed the limits of the Earth’s natural systems; where the rich get richer while the poor have a decreasing share of wealth and income.

But if we make money by making people sick or even killing them, by damaging or destroying communities or undermining the Earth’s natural systems that underpin our existence, in what conceivable way can we be said to have profited? How has our well-being been improved?

Happily, a growing number of key institutions recognize the limitations of the current model. Of particular interest are recent developments at the UN and among some national governments, perhaps including in Canada (the jury is still out on that). Here I will deal with recent UN reports, next week I will discuss national developments in Canada and elsewhere.

In a September 2021 speech introducing his report ‘Our Common Agenda’ to the UN’s General Assembly, UN Secretary General Antonio Guterres noted: “GDP fails to account for the incalculable social and environmental damage that may be caused by the pursuit of profit”. The report itself went further, commenting: “Absurdly, GDP rises when there is overfishing, cutting of forests or burning of fossil fuels. We are destroying nature, but we count it as an increase in wealth.”

Guterres also called for a new way to measure progress, one that values “the life and wellbeing of the many over short-term profit for the few.” A UN Environment Program report from February 2021, ‘Making Peace with Nature’, goes further, spelling out some of the ways in which we need to re-design the economy.

This re-design includes incorporating full natural capital accounting, so when we deplete the Earth’s natural resources we count it as an economic loss, not a gain. That is one part of switching to measuring ‘inclusive wealth’, which is “the sum of produced, natural, human and social capital” – real wealth means increasing all these forms of capital at the same time.

Other key steps include governments moving “away from environmentally harmful subsidies”; ensuring “investments in sustainable development are financially attractive”; taxing harmful things, such as resource use and waste, rather than socially beneficial things such as production and labour.

These and related social measures spelled out by the WHO, such as decent and secure work, fair trade and inclusive social protection systems, are the basis for creating a Well-being economy and society. It is a clear call to put people and planet before profit and to re-define what business we are in as a society – it must be the economy of the future.

© Trevor Hancock, 2022

thancock@uvic.ca

Dr. Trevor Hancock is a retired professor and senior scholar at the

University of Victoria’s School of Public Health and Social Policy