The Body Economic

Why Austerity Kills

By David Stuckler and Sanjay Basu
Book Review Details
Author: David Stuckler and Sanjay Basu
Publisher: Allen Lane
Edition: 2013
Page Details
Section: Book Reviews =>
Subjects: Modern History (Post World War II)
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This book and one of its authors briefly hit BBC radio in the summer of 2013 and luckily one afternoon I caught one of the interviews. What stuck in my mind was the almost unbelievable statement made by David Stuckler that ‘ten million Russian men disappeared in the early 1990s’ as a result the transition from so-called ‘Communism’ to ‘Capitalism’. Ten million! Surely this must have made world news? How had I not heard about this biblical scale disaster? It must be left wing lies….mustn’t it?

The authors, Stuckler (an expert in the statistics of public health) and Basu (a mathematician, professor of Medicine and epidemiologist) have been studying the relationship between public health and recessions, depressions and economic change for nearly a decade. The book is effectively a summary of numerous scientific papers they have produced in collaboration with many health organisations and researchers. The fundamental point they make is that economic conditions and collective human health go hand in hand.

The first section of the text deals with three historical case studies, the ‘great depression’ of the 1930s in the U.S., the transition from Soviet ‘socialism’ to a free market economy in the 1990s and the collapse of the ‘Asian Tiger’ economies in 1997. Each of these, as the authors’ call them, ‘natural experiments’, allow a statistical comparison of public health between states employing different economic policies to deal with fiscal crisis or major structural change. In general these policies boil down to two options within the confines of capitalism.

The first is rapid ‘free market shock therapy’; that is the ‘one-two punch’ of privatisation and austerity, with cuts to public welfare, healthcare, food subsidies etc. The theory (or some might say ideology [1]) is that by reducing state intervention (and spending) to a minimum national debt is reduced and economic confidence is restored. By deregulating markets, lowering taxes and increasing unemployment, wages go down and profits go up, incentivising business owners in the process. Then as if by magic (or the ‘invisible hand’ of Adam Smith), economies pull themselves out of recessions and ‘backward socialist’ economies transition rapidly to free market capitalism. This is essentially an attack on the most vulnerable sections of the working class, but can lead to a generalised assault through economic restructuring. Effectively the working class collectively pays for the crisis or transition, or as one economist stated it’s a bit like ‘the claim that soup kitchens caused the great depression’[2].

The second option, involves various forms of state intervention in the crisis (effectively quasi-Keynesianism), is usually gradualist, involves guarding or even expanding social protection policies (welfarism, healthcare, social housing etc.) and hopes to expand the economy by creating jobs, protecting working class spending power and stimulating demand. Issues around national debt are resolved by economic growth producing greater tax revenue. This latter approach was famously introduced in the mid-1930s in the U.S. as the ‘New Deal’ after years of waiting for the world economy to rejuvenate itself by the’ invisible hand’ (which never appeared!) after the Wall St crash of 1929.

The point that the authors’ quantitatively ram home in The Body Economic is that the first policy option is very bad for your health. Our and our dependents vulnerabilities are not just limited to immediate material needs, such as food, housing, energy and healthcare, but also extend to mental health issues such as stress, anxiety and depression which in-turn relate social isolation, drug and alcohol abuse.

Russia (unlike many of its neighbours; Belarus, Poland, Czech Republic etc. [3]) in the early 1990s underwent the ‘free market shock therapy’ option which was driven by a fear amongst Harvard economists and politicians in the U.S. and Russian ‘reformers’ that ‘communism might come back’ if they did not move fast. The rapid privatisation envisaged to ‘smash the Soviet state’ made Thatcher’s efforts of the 1980s in the U.K. look pathetic; she had ‘privatised about twenty large British utilities in eleven years…the Harvard economists planned to privatise more than 200,000 Soviet enterprises in less than 500 days’ [4].

The results of this policy were catastrophic both economically and more crucially for public health. Per capita income in Russia and most of the former Soviet Union dropped by over 30% reducing the size of the Russian economy to that of the U.S. in 1897! Poverty increased at an incredible rate from about 2% under ‘communism’ in 1987-88 to 40% in 1995. In the three years between 1991 and 1994 mortality rates increased by 35%. Average life expectancy dropped from a high of 70 years in the late 1980s to 64 in 1994 and in 2013 is just recovering to the levels before the fall of ‘communism’ nearly 25 years later! The main group to be affected by this ‘post-communist mortality crisis’ were counter-intuitively not infants or the old, but young working-age men; ‘life expectancy among Russian men dropped from 64 to 57 years of age between 1991 and 1994’…’the worst drop in life-expectancy in the past half-century in any country that wasn’t an active war zone or experiencing a famine’[5]. The authors explain these astounding statistics by citing the most common causes of death as alcohol induced heart disease, alcohol poisonings, suicides, homicides and injuries.

The second deadly punch in the combination after privatisation was austerity. The Soviet health system which was organically linked to the workplace was devastated by ‘shock therapy’; so as tens of millions of Russian workers sunk into unemployment and desperate poverty the safety net was pulled away by the free market ideologues. As a result, when people most needed it, the social protection was gone. Consequently, 10 million people out of a population of 147 million in the early 1990s died over a few bitter years as their lives and communities were devastated by ‘shock therapy’ policy. One Russian vice-president called it ‘economic genocide’ whilst the running joke amongst the working-class was ‘The worst thing about Communism is Post-communism’[6]. I say ‘working-class’ because with all free-markets class divisions are exacerbated. According to the authors’ by the mid-2000s ‘a twenty-one year old Russian factory worker could expect to live fifty-six years, about 15 years less than the factory managers and professionals’[7]. Another great achievement of ‘free-market’ capitalism.

The initial reaction of many ‘free-market’ ideologues to the work of these authors and this this book has been understandably venomous, after all no-one wants to be accused of holding ideological positions that lead to genocide on a Hitlerite, Stalinist (sic) or King Leopold scale[8]. At first they claimed the findings were laughable, and then as more evidence appeared they tried to discredit them or even in the case of The Economist magazine magic them away with ‘schoolboy’ statistical manipulation[9]. Eventually, as the weight of evidence told, some top nobs who had had a hand in implementing the ‘shock therapy’ policies acknowledged they had been wrong[10]. It was a bit fucking late for the Russian working class and as far as I know we don’t have ‘economic war’ crimes trials (yet), so they probably think they are safe in their Manhattan penthouses.

There is more to this book than the section on the transition from state socialism to free-market capitalism in the former Soviet Union which I have concentrated on. The authors are keen to promote Keynesian style policies to protect the population from the ravages of the free-market and in later chapters in the book study an ongoing ‘clinical trial’ we are all unwillingly part of; that is the world economic recession/depression kicked off in 2008. They even provide three simple policies for protecting the ‘body economic’ from ‘radical austerity programmes’. First, treat economic policy like the introduction of a new drug; that is ‘analyse government programmes and disclose to the public how various policies affect public health’. Second, ‘help people return to work’ and third ‘invest in public health’[11]. However, despite these limitations, which go no further than trying to ameliorate the worst excesses of capitalism, the power of this work lies in two areas.

First, it exposes in quantitative terms the hidden but massive effects, principally upon the exploited, of recessions, depressions and structural change within capitalism. It also demonstrates that the pace of change is of vital importance. In Britain (the birthplace of modern capitalism[12]) the transition from pre-capitalist forms to fully-fledged industrial capitalism arguably took about 150 years (1700-1850). I am not sure how much research has been undertaken to the level of The Body Economic in assessing the effects of this transition in terms of mortality rate[13], but imagine if this process had been squeezed into 20 years (as in the Soviet Union between 1917-1937 or China between 1949-1969). The increase in mortality rate would have been immense and certainly would put the figures for Russia in the early 1990s in context. We have other such contexts (albeit hidden) in British colonial history which to judge The Body Economic against. The famines in the late 19th Century in India and China for example, which claimed the lives of tens of millions, according to one excellent study[14] were due to the confluence of the introduction of laissez-faire free market capitalism, El Niño and crucially, Malthusian driven neglect of the exploited by their British rulers. We may be fully aware of the 20th Century ‘communist’ famines during the brutal industrialisation of the Soviet Union and China (mainly down to hysterical cold-war propaganda) but what do we know of these ‘free-market’ famines? The Body Economic goes some way to redressing this balance and showing how the capitalist ideological cover-up continues into the 21st Century.

Second, the authors’ draw an immediate comparison with the Con-Dem austerity programme launched after the election of 2010 in the UK. How many people are dying and have died young in the U.K. as a result of suicide, drug and alcohol abuse, depression, unemployment, bad health care etc. directly or indirectly related to the effects of the recession and the austerity measures? We know that last winter there was a 29% increase in deaths (an ‘excess’ of 31,000) which remain ‘unexplained’[15]. Do we have to wait until some scientists from the US demonstrate in 20 years that David Cameron and his ‘free-market’ cronies killed more Britons than the Nazis did in WWII?

(RB 15-12-2013)

  1. [1]Theory is where you have ideas; ideology is where ideas have you. [Back...]
  2. [2]The Body Economic: Why Austerity Kills, David Stuckler and Sanjay Basu, Allen Lane (2013) p.5. [Back...]
  3. [3]The shock therapy option was proposed for these countries and even began to be implemented, but working class resistance through Unions and public protest reversed these policies; The Body Economic: Why Austerity Kills, David Stuckler and Sanjay Basu, Allen Lane (2013) p.33. [Back...]
  4. [4]In the end 120,000 state enterprises were sold over two years. The Body Economic: Why Austerity Kills, David Stuckler and Sanjay Basu, Allen Lane (2013) p.30 and 35. [Back...]
  5. [5]The Body Economic: Why Austerity Kills, David Stuckler and Sanjay Basu, Allen Lane (2013) p.23. [Back...]
  6. [6]The Body Economic: Why Austerity Kills, David Stuckler and Sanjay Basu, Allen Lane (2013) p.32. [Back...]
  7. [7]The Body Economic: Why Austerity Kills, David Stuckler and Sanjay Basu, Allen Lane (2013) p.27. [Back...]
  8. [8]See king-leopolds-ghost [Back...]
  9. [9]The Body Economic: Why Austerity Kills, David Stuckler and Sanjay Basu, Allen Lane (2013) Fig. 2.5 p.39. [Back...]
  10. [10] Milton Friedman, the mother of all free-market ideologues, for example. The Body Economic: Why Austerity Kills, David Stuckler and Sanjay Basu, Allen Lane (2013) p.37. [Back...]
  11. [11]The Body Economic: Why Austerity Kills, David Stuckler and Sanjay Basu, Allen Lane (2013) p.143-5. [Back...]
  12. [12]The Origin of Capitalism: A Longer View,, Ellen Meikskins-Wood, Verso Books, (2002). [Back...]
  13. [13]There is considerable evidence that the height of the British working class (a measure of nutrition and well-being) massively decreased in the 19th century as a result of the transistion. See for example Height, Weight and Body Mass of the British Population since 1820, Roderick Floud, Historical Paper 108, National Bureau of Economic Research, Cambridge MA (Oct 1998) at [Back...]
  14. [14]Late Victorian Holocausts: El Niño Famines and the Making of The Third World, Mike Davis, Verso, (2001). See the BRHG review at: Late Victorian Holocausts [Back...]
  15. [15]See [Back...]

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