Kim Scipes

[1] I totally agree with Ted Trainer's position in GFB #109

[2]: any attempt to reconcile growth with sustainability is nonsense.

But I want to also raise the question of growth in relation to equity.

The US, for example, is generally recognized as one of the leading economic powerhouses in the world - GDP is much greater than any other country. Yet what is rarely recognized is the income inequality that exists *within* the US which is amongst the highest in the world: Inequity as measured by the Gini Coefficient [3] in 1995 [4] 1995
E. Europe 0.29 S + SE Asia 0.34 America 0.43 Africa 0.42 N.
FSU 0.30 Pacific OECD 0.36 Latin Am 0.50 Middle East 0.45
W. Europe 0.33 China + 0.38

Note: the higher the Gini Coefficient, the higher the inequity.

Gini Coefficient for families in US [5].

1947 0.376 1975 0.357
1950 0.379 1980 0.365
1955 0.363 1985 0.389
1960 0.364 1990 0.396
1965 0.356 1995 0.421
1970 0.353 1998 0.430

From the above we can see that income inequality generally declined from the late 1940s to the late 1960s, but since then has been almost constantly increasing to where it is now greater than at any time since 1947.

In fact, the rate of income inequality in the US has been greater every year since 1982 than in any one year between 1947 and 1981. In other words, not only is the income inequality greater than ever before, but it continues to get worse over the years. This income inequality is also (predictably) stratified by race (White Americans v African-Americans and Hispanics) and stratified by gender. Income inequality is not only undesirable in a general sense, such as for democratic governance and social cohesion, but it also has very negative affects on health. Income distribution has been found to be perhaps the most significant component when considering health as measured by life expectancy of mortality [6].

'Income distribution acts as a summary of contributors to relative deprivation and is closely related to psychosocial variables likely to impact on health. Many studies within populations find socioeconomic or psychosocial factors strongly affect health.' [7] Bruce Kennedy et al assert: '..studies indicate that inequalities in income may have extraindividual or contextual effects that structure the social environment in ways that affect the health of a population.' [8]

R G Wilkinson has demonstrated in a sample of developed countries that life expectancy increased as the equity of income distribution increased, and irrespective of the average level of income. Moreover, countries that had shown increases over time in the equity of income distribution had proportionately greater increases in life expectancy compared with countries that had shown increased inequity in income distribution [9].

The impact of this inequality is a result not just of absolute levels of income, but also because of *relative* differences. In other words, reducing the health impact of income inequality cannot be done by making all socioeconomic levels of the population wealthier. It also requires a reduction in the ratio of wealth between the rich and poor. In short I believe that not only are sustainability and growth incompatible, but so too are sustainability and inequity. We must democratically decide what minimum levels of equity are necessary and devise the most appropriate means to achieve and maintain those levels. At the global level, this means full democratic participation of developing countries and their peoples in the discussion and decision- making. The outcome may mean reducing standards of living in the North in order to raise standards of living in the South. *

[1] Kim Scipes is a PhD student in Sociology, Univ. Illinois, Chicago, US e-mail mailto:sscipe1@icarus.cc.uic.edu>.

[2] Trainer, Ted 'Growth and sustainability are incompatible' Global Futures Bulletin #109, 01 June 2000

[3] The Gini Coefficient measures the deviation from perfect equity. The x-axis measures the cumulative fraction of the population (0-1), and the y-axis measures the cumulative fraction of total income (0-1). A perfectly equitable society would graph as a straight line from x=0, y=0 to x=1, y=1. The greater the inequity, the greater the bend of the curve below the straight line of perfect equity. The Gini Coefficient measures the area between the straight line and the curve (ie the deviation, call C), as a ratio to the whole area bordered by x-axis and the straight line of perfect equity (the whole area is always 0.5, call C+D) ie C/C+D, or C/0.5, or 2C. The higher the Gini Coefficient, the higher the inequity.

[4] Raskin P, Gallopin G, et al 'Bending the Curve Toward Global Sustainability - Report to the Global Scenario Group' (1998) page A8 http://www.gsg.org page A8 cited in 'Equity' Global Futures Bulletin #79, 01 Mar 1999.

[5] US Census Bureau www.census.gov/ftp/pub/hhes/income/histinc/f04.html

[6] 'Health and Income Equity Project' International Health Program, Univ. Washington US, Health Alliance International http://depts.washington.edu/eqhlth/paper.html

[7] 'Health and Income Equity Project' op cit

[8] Kennedy, Bruce; Roberta Glass, 'Income distribution, socioeconomic status, and self rated health in the United States: multilevel analysis ' British Medical Journal 3 Oct 1998, 317, pp 917-921 http://www.bmj.com/cgi/content/full/317/7163/917

[9] Wilkinson RG. 'Income distribution and life expectancy'. British Medical Journal 1992;304 pp165-8. cited in Kaplan, George et al 'Inequality in income and mortality in the United States: analysis of mortality and potential pathways' British Medical Journal 1996;312 pp999-1003 (20 April) www.bmj.com/cgi/content/full/312/7037/999 * {38. equity}

* * COMMENT **

Again the term 'growth' is used without specifying whether it refers to physical growth and increase in throughput of materials and energy, or economic growth - ie growth in GDP. Jeffrey Milyo does not believe the Kennedy-Glass study (cited above) demonstrates that inequality exerts an independent effect on individual health, and points to what he sees as methodological weaknesses [1].

Other studies support the Kennedy-Glass findings (such as the Kaplan and Wilkinson studies mentioned above), so Milyo's dissent is mentioned here as a word of caution. 'Sustainability' is a normative term (a goal we have constructed). Sustainability and inequity are not compatible because sustainability is defined as such [2].

It should also be mentioned that, from the time series on inequity in the US cited above it is apparent that growth and equity are not necessarily incompatible since the rapid growth period 1947-1965 was also a period of growing equity in the US. However, it could be that higher taxes on the wealthy (progressive tax scales - the main form of wealth redistribution) have been reduced (flattened) as a strategy to maintain entrepreneurial incentive and high economic growth while entering a new phase (eg 1980+) of a 'mature economy' brought about by: - transfer of economic growth to certain transitional economies in the developing world (eg East Asia) with lower labour and capital overheads, and/or - approximation of the economy to environmental limits to growth (or at least tighter constraints on growth).

Thus it is possible that inequity is a more likely outcome when growth is stimulated in a mature economy. On the otherhand flattened tax scales could merely illustrate current successful domination in the political arena by the wealth lobby, or by economic neoliberalist ideology, or both. In a 'business-as-usual' scenario, the Global Scenario Group see inequity increasing in every region of the world through to 2050 [3] with a final range, (Gini Coefficient), of 42-52. Even in their 'policy reform' scenario inequity increases over 1995 levels in S + SE Asia, E. Europe, FSU, Pacific OECD, and W. Europe, remaining steady in China+, and decreasing somewhat in Africa, Latin Am., Middle East, and N. America - with a final range of 35-41. *

[1] Milyo, Jeffrey Health Policy Program Yale Univ. US. www.bmj.com/cgi/eletters/317/7163/917#EL1

[2] 'Even the narrow notion of physical sustainability implies a concern for social equity between generations, a concern that must logically be extended to equity within each generation' Our Common Future: the World Commission on Environment and Development OUP 1987 p43.

[3] Raskin P, Gallopin G, et al 'Bending the Curve Toward Global Sustainability - Report to the Global Scenario Group' (1998) page A8 http://www.gsg.org

* * * * The IGFR is a not-for-profit organisation.****

Institute for Global Futures Research (IGFR). P.O. Box 263E, Earlville, QLD 4870, Australia. E-mail: igfr@igfr.org .