When it all works , we get Sweden !

What would we expect if we succeed in our campaign to promote and realize global equality and its effect on health? Lets look at things economically first, since from a biopsychosocial perspective, this is still an important aspect to consider in health outcomes as a part of the social determinants of health.

Sweden is one of the few advanced and successfully low income inequality countries. By studying their benefits and detriments, we can understand the benefit of an equal global society, and how that would impact health.

In Sweden, there is an almost egalitarian distribution of income and low rate of poverty compared to similarly advanced countries such as the USA and UK. In fact, the living standards of the poor are close to those of median citizens than in other advanced countries.

Sweden’s war against poverty is so well done that poverty is rarely seen as part of public discussion as opposed to other advanced and developed countries. In fact, just among children, only 8.2% fall below the poverty line in Sweden compared to the 15.1% in Australia and the 21.2% in the United States of America.

How has Sweden produced such an egalitarian income distribution and reduce inequality? Much of the success is found in Sweden’s high tax and transfer systems in combination with factors that directly or indirectly skewed labor demand in favour of the less-skilled workers, creating a higher income, less wage inequality economy. The latter is done through a variety of Swedish policies which incentivize workers to not work more than their contracted hours (five-week mandated vacation, parental leave, holiday time, incentive to call in sick, high marginal taxes etc) in combination with wage compression (where differences in pay do not vary much despite experience, skill sets etc*) which come together to produce massive “work sharing”, reducing wage inequality in Sweden.

These policies, by reducing work hours and incentivizing vacation/holiday/sick leave often cause Swedes to rate their health and happiness higher than those in say America. In fact Sweden nets a higher happiness level according to surveys, with a net happiness level of 91% compared to USA’s 84%.

Swedish policy also highly benefits those with disability, whereby the massive work sharing effect spills over, improving employment in the disabled. Those employers who employ the disabled, are also subsidized for sick leave and money lost due to the disability by tax payers money.

Overall, Swedish policy also reduces inequality for the disabled. US citizens with no disability had an employment rate of around 85% (compared to Swedens 90%) while those with some kind of disability had an employment rate of 45% (compared to Swedens 63%). This improves the psychological well being of the disabled, which often benefits from their ability to function and provide in an economy and community, which by the biopsychosocial model of health, greatly improves their overall health. The high employment in those with disability would also reflect a better ability for those with disabilities to comfortably pay for their health care bills compared to the USA.

Of course Sweden has its own problems with inequality, and is not entirely the egalitarian Utopia many imagine it to be. While Sweden does in fact have a low income inequality, it has a high wealth inequality, with the top 1% of earners controlling 25-40% of all wealth (large range due to inaccuracy caused by high tax evasion, a downfall caused by high taxes). This issue however is to a degree, counteracted by the punitive high tax rates which devalue those assets.

Another issue is that belonging to the upper class in Sweden is dependent more on blood than on wealth, the opposite of the USA, making class mobility much harder in Sweden than in the USA.

Despite this, Sweden remains as one of the most successful economies in lowering inequality, which has benefitted their health outcomes clearly, with a life expectancy of 81 years, compared to that of the more wealthy, but more unequal USA with a life expectancy of 78 years, on top of the lower poverty in Sweden compared to the US. What is it that produces better health outcomes in the less economically unequal countries?

Of course poverty and poor health go hand in hand, so by reducing poverty, we improve health, but research shows that inequality is detrimental to the health of not just the poor, but the affluent too. This is hypothesized to be due to inequalities detrimental effects on social cohesion, which leads to more stress, fear, and insecurity for everyone, which by the biopsychosocial model of health, would negatively affect health of the whole population.

So what lessons can be learnt from Sweden? Sweden shows that wealth of a nation does not at all mean it has the best health, but rather, it is the way in which that wealth is distributed. Sweden has stronger taxes compared to the USA, however Sweden is more effective and efficient in its transfers, efficiently lower income inequality, and providing an equally efficient and effective health care system.

We contend to you, that despite Sweden’s low GDP of 725 Billion USD compared to Americas high GDP of 22.1 Trillion USD, Swedens more equitable economy has meant that Sweden not only has health outcomes comparable to the USA, but their health outcomes are in fact better!

Sweden serves as an almost perfect example of why we fight for equality, and the bountiful benefits it has on health.

 

Leave a comment if you agree or disagree with what has been said, as feedback and debate on the matter are encouraged and appreciated!

 

From the ‘Mind the Gap’ team.

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