PHA-Exchange> Is globalization dangerous to our health?

[Claudio Schuftan]

Is globalization dangerous to our health?
Stephen Bezruchka
(adapted)

 When asked about globalization, Margaret Thatcher replied: "There is no
alternative." Her reply was shortened to "TINA," which some people think is
a newly discovered law of nature... Yet, public resistance to this new
corporate-centered trade is increasing. What relevance does this have to
health? or Does globalization affect health?

Many think about the health effects of modern global trade as involving
increased pollution by corporations or global warming caused by the
increased use of fossil fuels.
Others focus on the increase in the tobacco market penetration. The
expansion of global cigarette exports is a dramatic example, totaling 223
billion cigarettes in 1975 rising to 1.1 trillion in 1996 (a 5-fold
increase).
Or they might consider deaths from toxic exposures in poor countries as US
corporations evade environmental restraints at home (Bhopal).

These effects are real, but they pale in comparison with globalization's
effect on increasing inequality, the most powerful factor affecting a
population's health and responsible for perhaps 14 to 18 million deaths a
year (18% of total deaths) worldwide.

 DANGERS OF HIERARCHY IN HEALTH
The health of the US population is disgracefully poor compared with that of
other rich countries. In the ranking of countries by life expectancy in
1997, the United States stood 25th, behind all the other rich countries and
even a few poor ones.
The prevalence of smoking in Japan is tied with that in China as the highest
in the world and 3 times that of the United States; yet, the Japanese do not
die of smoking-related diseases to the extent that Americans do. Lung cancer
mortality rates in Japan are one half to one third of those in the United
States. How does Japan do it?
The answer is simple. The health of populations in rich countries is
determined primarily not by the health care system-- we have the most
sophisticated and expensive one, so it cannot be that, but rather, by the
gap between the rich and the poor. Many recent studies show that populations
with a greater income hierarchy are less healthy, and specifically have
shorter lives, than populations that are more equitable.  Independent
investigators have studied many different populations and all agree: the
strongest factor affecting health is the size of the gap between the rich
and poor.

 THE WEALTH AND INCOME GAP
The United States has the greatest wealth and income gap of any rich
country, which is the main explanation for its dismal health ranking among
developed countries. We did not always fare so poorly: in 1960, we were
13th. As our wealth and income gap have grown, so has our distance from
the healthiest country.

Most countries in the world are poor, with most people subsisting to produce
their own food, often supplementing their income by sending family members
to cities to work in factories or abroad. In some countries,
immense wealth lines the pockets of only a few people. In poor countries,
the evidence suggests that equitable development that focuses on providing
basic needs is the route to improving the population's health.

THE PROBLEMS WITH CORPORATE-CENTERED TRADE
In the past 1 or 2 decades, world trade could be more accurately described
as trade that is corporate-centered. This change began in the mid-1970s and
was boosted by the economic policies of Thatcher in Great Britain and Ronald
Reagan in the United States. Today the dogma governing economic activity is
founded on the principle that the
market knows best and should govern the world. The implicit assumptions
are that economic transactions involve a buyer and a seller who are on an
equal footing and that the price accurately reflects the cost. The influence
of indirect subsidies in tipping the scales is overlooked. In 1995 Boeing,
one of the  most successful corporations, received a tax credit of more than
$33 million. Microsoft increased profits by 71% in 1999 over the previous
year, yet paid $226 million less in taxes.  Of the world's 100 largest
corporations, 20 would have gone bankrupt without such assistance.

The so-called free trade with and in poor countries has produced great
wealth for multinational corporations and provided low-wage jobs that keep
many people in poverty. Among countries, the gap between the richest and the
poorest quintile was 3 to 1 in 1827, rising to 30 to 1 in 1960, to 60 to 1
in 1990, and to 76 to 1 in 1997. Recent studies have shown that where there
is increased penetration of foreign investment in poor countries, slower
economic growth and greater inequality result. Global economic greed is the
problem.

But what of the effects of global trade in rich countries? In the past 25
years, most people in the United States have seen a decline or stagnation in
incomes after adjusting for inflation. This came during a period of record
profits for corporations and a booming stock market. The United States has
begun to look more and more like a third world economy, with a fabulously
wealthy elite few surrounded by a mass of people not sharing in the
globalized pie. The top 1% of families in this country holds more than 40%
of the wealth.

What are the population health effects of corporate-centered economic
policies? In rich countries, capital is abundant, whereas in poor countries,
labor is plentiful. Production moves to poor countries where labor is
cheapest. Free trade in goods and services leads businesses to produce goods
that are capital-intensive in high-wage countries but labor-intensive in
poor ones. Benefits from trade and investment generally flow to the rich
countries rather than to poor ones, and thus, income inequality among
countries is increased. Within poor countries, more people have been
displaced from their subsistence economies than have been able to find jobs
in the manufacturing sectors in overcrowded cities. In poor countries, as an
elite profits immensely from this shift, the income gaps increase. In rich
countries, the demand for labor is lowered, wages become relatively
depressed, and income inequality increases. For most of the world's people,
it is a lose-lose situation.

Health professionals need to understand that what seems best for an
individual patient may not benefit the population, if the goal is to
maximize its health. Individual risk factors need to be de-emphasized and
population risk factors addressed. The most important risk factor is the gap
between the rich and poor.
Genuine, widespread improvements in health and quality of life will take
structural changes in the distribution of income and wealth. The evidence is
clear that in rich countries, health care has not had a major effect on
reducing mortality in populations.

If a healthy population is our goal, health policy is taking us in the wrong
direction. We need vigorous debate over who is subsidized and by how much.
Changing who shares the benefits in the world economy today is the challenge
of the new century. The health of our nation and our people
depends on it.

Summary points:
Determinants of population health differ from those affecting individual
health.
Population health in rich countries is determined primarily by the size of
the gap between rich and poor.
The United States ranks behind all other rich countries and a few poor ones
in health outcomes such as life expectancy.
Globalization, or corporate-centered trade, increases the gap between the
rich and poor within and among countries.
Policies that promote substantial corporate subsidies and increase the
rich-poor gap can be changed to improve population health.