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Want Growth? You Need People!

David R. Kotok
Thu Jun 8, 2023

We thank Philippa Dunne and Doug Henwood for granting us permission to share the entire commentary below. For information about their excellent research services readers may contact them directly: We want to remind readers that economic growth originates from two separate areas. The first is growth of the population (and within it the portion of labor force age). The second is the productivity of that population (labor force).  

As this research paper shows, we’re falling behind in the first factor. We have not recovered from the pandemic, and some of our leaders have failed to see the risks associated with this trajectory. 

This is a very important issue for financial markets. Picture the difference between the present trajectory and a different one that had a growing cohort of younger people entering the workforce. Then you can see how easily the rational financial approach can replace the irrational debate over debt ceilings. 

Here’s the straight-up discussion.

-David


 



State life expectancy, policy or choice?

TLR Analytics

Steven H. Woolf, part of the Center for Society and Health at Virginia Commonwealth University, recently published Falling Behind: The Growing Gap in Life Expectancy between the United States and Other Countries, 1933 to 2021. Painful to read, Woolf finds that increases in US life expectancy slowed from 0.21 years per annum between 1950 and 1954, to 0.1 y/a between 1955 and 1973, picked up steam into 1984, 0.34 y/a, fell to 0.06 y/a in 2019, and went negative, -0.97 y/a, in 2021. Between 1933 and 2021, life expectancy in six continents and fifty-six countries surpassed that of the United States, with growth slowest in the midwest and south. Woolf has said that as an academic researcher he “studiously avoids” bringing in politics, but believes that the “policies that differentiate the US from other countries may have contributed” to this turn of the tide, and are concentrated in the midwest and south, where life expectancies are generally lowest. Americans living in the northwest, California and the northeast live longest (Utah is also in the top ten), while those in the southeast have the shortest lives, with Oklahoma, and New Mexico included in the bottom ten. And as you would guess mortality rates are much higher among African and Native Americans.

In a Washington Post opinion piece Woolf and co-author Laudan Aron stress that although Covid was the immediate cause of the recent decline, life expectancy in other countries bounced back in year two of the pandemic, while in the US it went into further decline, and health conditions in the US pre-pandemic were already “dire.”

Woolf was part of a nine-person team, led by University of Syracuse’s Jennifer Montez, Nader Mehri, and Shannon Monnat, whose US state policy contexts and mortality of working-age adults  took a deep dive into life expectancy rates around the US linking them to state policies. The team found it “shocking” that the US’s 78.8 years, 5.7 years less than Japan’s 84.5 years, falls between Cuba and Albania, both middle-income countries. In 1959, Kansas and South Carolina had the highest and lowest life expectancies, which would have ranked them fifth and thirty-fourth among the world’s largest countries. Currently the world average is 82.5 years, and the US state with the longest life expectancy, Hawaii, also 82.5 years would rank 22nd, while Mississippi, the lowest at 74.4 years, would rank 79th were it a country.

The team ties the increase in mortality rates to a “stalled decline” in cardiovascular disease, and rising mortality related to alcohol, suicide, and drug poisoning, with overall life expectancy is being dragged down by rising mortality among those aged 25 to 64. Comparing US rates to other countries shows that 67% of the shortfall among US men and 41% among women is accounted for by deaths of people younger than 50, and between 2006 and 2008 noncommunicable diseases, unintentional injuries, and homicide, among men, contributed to the US deficit, with the higher death rate for those under 50 driven by noncommunicable disease, drug poisonings, suicide, and prenatal conditions.

The authors’ “sobering picture:” among every 100 babies born in the US, two will not see their thirtieth birthday, six will not see their fiftieth, and sixteen will die before retirement age. And Woolf points out elsewhere that the probability of babies born will live into their twenties is in decline. 

The team highlights a 2021 report from the National Academies of Science, Engineering, and Medicine (NASEM) that grouped influences by layer, macro, being social, political and cultural forces including state and federal policies; meso, community, family and work; and individual, behavior, biology, and socioeconomic status, noting that scientists are urging greater attention be given at the macro level. One study found that over the last forty years changes in US policies have had “detrimental consequences,” and that matching the generosity of social programs in 17 other high-income countries would add nearly four years to US life expectancy. They also stress the importance of macro policies as they feed into meso and individual.

One of the authors, Jacob Grumbach of the University of Washington, culled public sources and grouped 135 policies into 16 silos: abortion, campaign finance, civil rights and liberties, criminal justice, marijuana, education, environment, gun safety, health & welfare, housing and transportation, immigration, private sector labor, public sector labor, LGBT, economic taxes, and voting. Grumbach then assigned a liberal to conservative scale to each state, with liberal policies those that give states more power for economic redistribution and regulation, protect the rights of marginalized groups, and restrict state power to punish misbehavior. Conservative policies go the other way. And yes, describing some of those state policies as “conservative” gets us into a logical tangle.

Anyway, eight domains met their selection criteria: criminal justice, marijuana, environment, gun safety, health & welfare, private labor, economic taxes and tobacco taxes. They found “especially strong” associations between male suicide and gun safety, alcohol-induced mortality and the labor policies, and between economic and tobacco taxes and cardiovascular disease mortality. Marijuana legalization was the only liberal policy not associated with lower mortality. Simulations suggest that if all states had fully liberal policies, 171,000 lives would have been saved in 2019. If all policies turned fully conservative, 217,000 additional lives would be lost. 

It’s interesting work, and we highly recommend you take a look at their chart pack.

Woolf and Aron end on a hopeful note. We know from other countries, including those with very different political and social structures, that higher life expectancy can be managed through better policy, and at “far lower cost,” that the US spends on health care.

Montez notes that “The decisions being made in state houses increasingly having life and death consequences for working-age Americans. Much of the narrative about the rising death rates of working-age Americans has pointed to opioid manufacturers and businesses leaving certain parts of the country. Our analyses points to another major player, and that’s state policymakers.

Philippa Dunne & Doug Henwood

 

 

 

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