Recent news that the top 1% of Canadians earn an average $381,000 a year might make you envious. It might make you frustrated, or perhaps even motivate you to work harder. But will it make you sick?
Once the domain of organized labour and the Occupy Movement, income inequality has suddenly become a fixation among municipal public-health offices as well. Several municipal health boards—including Guelph and Waterloo Region in Ontario as well as Montreal—have issued reports warning of the alleged health risks of income inequality. The Canadian Medical Association made a similar argument in a brief to the House of Commons this past April.
Waterloo Region Public Health’s new study, for example, claims a growing gap between rich and poor creates a “socially corrosive” situation that makes everyone ill. “Individuals (regardless of individual income) tend to have worse health outcomes in societies that are unequal,” it warns.
Public-health officials used to spend their days worrying about the spread of tuberculosis, cholera and other contagions. Now they’re claiming those greedy one-percenters are a health risk too. Does this make any sense?
There’s a regrettably reliable link between individual levels of income and health. Notwithstanding Canada’s public medical system, if you’re poor, you tend to die younger. Yet Statistics Canada data reveals the incidence of poverty, as defined by the low-income cutoff, is now at a record low. You’d think this might prompt widespread rejoicing among the public-health community. Apparently not.
Instead public-health offices are now taking up the cry that income inequality itself leads to poorer health. This requires the heroic assumption that it’s not the absolute level of your income that affects your lifespan, but rather the relative distance between your income and those at the top of the food chain. In other words, it’s not merely unhealthy to be poor; it’s also unhealthy for others to be rich.
Taken to extremes, a wide disparity in income or wealth may well lead to “socially corrosive” outcomes. The French and Russian revolutions come to mind. But applying this sort of Marxist analysis to the modern welfare state is entirely far-fetched.
For starters, where’s the proof? Despite decades of work by public-health researchers hoping to prove their case on a scientific basis, conclusive evidence is nowhere to be seen.
The idea that income inequality leads to shorter lifespans has been thoroughly rubbished by the British Medical Journal. And an exhaustive look at Canadian experience in the peer-reviewed international public-health journal the Millbank Quarterly reported “no association between income inequality and mortality in Canada.”
Beyond the lack of Canadian evidence, it’s worth pointing out demands for greater income redistribution to solve income inequality are far beyond the mandate—not to mention the competency—of municipal public-health boards.
The work of Harvard economist Robert Barro, for example, reveals inequality is actually beneficial for economic growth in developed countries. And as the gap between rich and poor widens, absolute poverty in these countries tends to fall—which is exactly what we’re seeing in Canada.
Further, a recent publication from the School of Public Policy at the University of Calgary by economists Bev Dahlby and Ergete Ferede finds the costs of reducing income inequality below current levels to be prohibitive. Anything exceeding a 50% income tax rate tends to discourage economic effort; with high-tax Ontario already at a top federal-provincial rate of 49.5%, there’s nowhere to go. “Major tax increases or policy changes such as big hikes in the minimum wage will probably do more harm than good,” says Dahlby of the sort of programs necessary to satisfy vocal public-health boards.
So here’s an idea: how about we leave the vaccination clinics and bake-sale inspections to local public-health offices; and they agree to leave the economy alone.
Peter Shawn Taylor is a writer specializing in economic issues