From superpower to failed state: Inequality and the public health crisis in America

The pandemic has shined a spotlight on the failings of leaders and elites.

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“[President Donald] Trump has made matters worse by weakening an already frayed health care safety net.”

            ~Jeffrey Young, Huffpost Politics, August 3, 2020

Earlier this week, the novel coronavirus death toll in the United States exceeded 200,000.  As the highest in the world, it’s a distinction no self-respecting nation would desire or wish upon another. But there’s another “distinction” other democracies will happily abjure,  namely, a history of social injustice trending in the wrong direction.

The Covid-19 pandemic has thrown a glaring light on inequality in America at the same time as it has greatly widened the wealth gap between rich and poor. A particularly painful upshot of the gross income disparity between social classes—one that is unique to America among advanced economies—involves universal, affordable access to health care. 

According to Families USA, an estimated 5.4 million people became uninsured between February and May of this year. The socio-economic fallout associated with the public health crisis has “caused the greatest health insurances losses in American history.”

Tragically, in an era of Republican rule, “The U.S. health care system is designed to fail when it’s needed most.” Worse still, the Trump administration is deliberately deepening this crisis-within-a-crisis.

The myth of equality in America

Contrary to a common popular belief encouraged and perpetuated by leaders of both major political parties, America has made little or no progress toward a more equal society in the past half century. In fact, by many of the most important measures America has become less equal.

This pattern toward ever greater inequality has nothing to do with partisan perceptions or cherry picking the facts. Harvard’s Raj Chetty has developed a data tracker that provides a detailed real-time view of the pandemic-induced effects on local economies down to the neighborhood level.* The data doesn’t lie and what it makes absolutely clear is that the recession and related unemployment rates have returned to near normal for high-wage workers but “they remain significantly lower for low-wage workers.”  One chart shows by April, the bottom quarter of wage earners, those making less than $27,000 a year, had lost almost 11 million jobs, more than three times the number lost by the top quarter, which earn more than $60,000 annually.

In the following weeks and months, the gap widened. By June, the recession was all-but over for “high income individuals” while 80% of jobless workers were in the bottom half of the labor force.

It was exactly 50 years ago this month that Milton Friedman wrote a seminal essay denouncing the idea that corporations should have a “social conscience” and arguing that such a misguided business ethic would undermine “the basis of a free society.” If a corporation  “takes seriously its responsibilities for providing employment, eliminating discrimination, avoiding pollution and whatever else may be the watchwords of the contemporary crop of reformers,” it’s game over for American ascendency.  It would be Friedman’s views— given a rocket boost with the election of Ronald Reagan election in 1980—that gained the ascendency.

And the rest, as they say, is history:

The promise of vital legislative protections against the excesses of unconstrained capitalism — including the National Labor Relations Act, minimum wage laws, the Clean Air Act, the Clean Water Act, antitrust regulations and consumer safety laws, to name a few — were undercut by two generations of ceaseless attack. 

Between 1948 and 1979 worker productivity grew 108%; wages grew apace, rising an impressive 93%. The stock market rose by 603% during these three decades. From 1979 to 2018, worker productivity grew 70% but wages stagnated, rising by less than 12%. But no worries: Compensation for chief executives grew by 940% and the stock market rose 2,200 percent!  

Donald Trump is not responsible for what happened before 2016, of course, but he has used the prodigious power of the American presidency to double down on Milton’s Friedman cruel image of what America should be.  And he has done his damnedest to propel America from its superpower past to its future as a failed state.  

Pandemics and people

The Covid-19 public health crisis has shed new light on another fact of life, namely that human nature is not a singular thing.  The famous Pogo cartoon is relevant here: “Yep son,” Pogo says to Porkypine, “we have met the enemy and he is us.” As this pandemic has proven so clearly, human nature varies significantly. For some, it means taking responsibility for our actions—like social distancing and wearing a mask in a pandemic. For others, it means the exact opposite—taking off any pre-crisis mask of social responsibility.

The pandemic has shined a spotlight not only on the failings of leaders and elites but also on the most selfish, ignorant, and reckless “ordinary” human beings among us. And it has made them spectacularly easy to identify.

Because of its extremely infectious nature—but also because it is often asymptomatic—it has put the worst of our species—the ones who are too stunted to be heedful of science or respect expertise of any kind—in a position to prevent efforts to flatten the curve.  And the smallest minded, many with morals to typify the tiniest mentality, are led by the man at the top with the biggest ego and a megaphone to match.

*The American Economic Association has described Chetty as “arguably the best applied microeconomist of his generation.”

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