20 April 2006 (links added 16 March 2009)

How inequality makes people unhappy

By Tapani Lausti

Richard Wilkinson, The Impact of Inequality: How to Make Sick Societies Healthier. The New Press 2005.

It is widely believed that inequalities don't matter much as long as there is enough congregate wealth in the societies we live in. Richard Wilkinson's book makes a convincing case that this assumption is not only wrong but extremely harmful. The book is a synthesis of much international work on the impact of inequality. Thus the wealth of evidence helps us to understand how extremely wealthy societies can be such miserable places to live in.

Wilkinson compares social strategies which emanate from different degrees of inequality: "Inequality promotes strategies that are more self-interested, less affiliative, often highly antisocial, more stressful and likely to give rise to higher level of violence, poorer community relations, and worse health. In contrast, the less unequal societies tend to be much more affiliative, less violent, more supportive and inclusive, and marked by better health." (p. 23)

In essence, we are talking about human dignity: "Social status differentials have a huge impact on whether people feel valued, appreciated, and needed or, on the other hand, looked down on, ignored, treated as insignificant, and humiliated. And one of the most powerful influences on how important social status differentials are in a society is the scale of income differentials." (p. 26)

Social status is nothing abstract. It has dramatic effects. In the United States, for instance, "there is a strong relationship between death rates and income inequality in each state". (p. 69) Inequality kills. Unhappy people are more likely to die younger. Happiness in modern wealthy societies is closely related to how much "social capital" people have, i.e. how well they are involved with their immediate community and the wider society.

Wilkinson shows how violence is more common in more unequal societies. The burden of low social status increases the likelihood that people will feel disrespected and looked down on. This makes them angry. The idea of dog-eat-dog society weighs heavily on people's minds. They are deeply aware of the existence of social hierarchies. Consequently people are vulnerable to a need to look down on other people. They are more likely to have racist attitudes, and in the case of men, contempt for women.

Unequal societies are low on trust. People have a feeling that you cannot trust other people, that people are always putting their own interests first and are likely to take advantage of you: "Because of the social distances inequalities create, it looks as if they still impose severe limits on our ability to identify with each other." (p. 192)

The way work is organised in modern societies is also harmful. The feeling of not having much influence in one's own working life creates stress: "Sense of control is a more social concept than is often realized, and it is often affected by how much you are subordinated to the authority and instructions by superiors." (p. 75)

The research results which we now have available, according to Wilkinson, pave "the way for a conscious recognition of, and public argument about, the outline of our social nature and what kind of society we should try to develop". (p. 293) Wilkinson himself accepts the necessity of "markets" as opposed to "central planning", even if he highlights the need to oppose the antisocial effects of such a market society. He wants governments to encourage worker-ownership and cooperatives.

Indeed, according to one study quoted by Wilkinson, "people thought income differences were very much smaller in the town with more cooperative employment, death rates were lower, social networks were stronger, there was less domestic violence, and the educational performance of schoolchildren was better". (p. 309)

It is true that modern "market" societies can be made into nicer places to live in by increasing equality. Yet, I think it is important to have a vision beyond markets. Without such a vision Wilkinson's laudable idea of pushing "forward the current system of employee share ownership" and finding "a more democratic and egalitarian way of controlling business" (p. 304) will be easily stopped by aggressive corporate elites. Even in Finland, which would rate highly on Wilkinson's comparative observations, the employers have recently become much more aggressive towards their work force. The left and the trade unions seem to be at a loss how to react to this bullying. Partly, I think, this may be due to the unwillingness to look beyond markets.

I think people can get seriously interested in alternative movements only if there is something to really inspire them. Of course, a demand for more equal societies can be such an inspiration. Corporate propagandists have, however, been quite successful in claiming that equality tends to threaten our freedoms. This is why challenging market ideologies requires a clearer vision of future possibilities.

I agree with Michael Albert who thinks that a lack of long-term vision tends to weaken social reform movements. Albert says: "... what if one reason it is hard to agree on the short-term is because we have little clarity about the long-term, not a blueprint, but a viable vision? And what if it will actually be pretty easy to agree on a broad workable and desirable goal, once we actually try to do so, and that having arrived at one, the context and orientation it provides will make it easier to arrive at effective short-term preferences?" (Michael Albert, Moving Forward: Program for a Participatory Economy, AK Press 2000, p. 11)

In this context it is unhelpful of Wilkinson to use the death of the Soviet Union as a proof that there are no alternatives to markets. This is a political and historical misunderstanding if not falsification which plays into the hands of those in whose interests it is to maintain current unequal societies. Soviet economy in reality was not centrally planned but a chaotically and undemocratically administered economy. Decentralised planning with the help of democratically formed producer and consumer councils would be something else entirely. In the end, Wilkinson's view is not that far from such notions: "... rather than centralizing power, an increase in the number of democratic, employee-run companies represents a move in exactly the opposite direction: a devolution of power and expansion of democracy." (p. 310)


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