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Living and Dying in America in 2021

Dec 28, 2020 Anne Case , Angus Deaton

In addition to killing at least 340,000 people in America alone, COVID-19 has accelerated economic trends that promise to undermine the lives and livelihoods of less-educated people in the years ahead. While the pandemic eventually will be brought under control, there is still no end in sight for the epidemic of deaths of despair.

PRINCETON – American capitalism is not serving most Americans. While educated elites live longer and more prosperous lives, less-educated Americans – two-thirds of the population – are dying younger and struggling physically, economically, and socially.

This growing divide between those with a four-year college degree and those without one is at the heart of our recent book, Deaths of Despair and the Future of Capitalism. The rise in deaths that we describe is concentrated almost entirely among those without a bachelor’s degree, a qualification that also tends to divide people in terms of employment, remuneration, morbidity, marriage, and social esteem – all keys to a good life.

The COVID-19 pandemic is playing out similarly. Many educated professionals have been able to work from home – protecting themselves and their salaries – while many of those who work in services and retail have lost their jobs or face higher occupational risk. When the final tallies are in, there is little doubt that the overall losses in life and money will divide along the same educational fault line.

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Anne Case

Writing for PS since 2020
2 Commentaries

Anne Case is Professor Emeritus of Economics and Public Affairs at Princeton University. She is the co-author of Deaths of Despair and the Future of Capitalism (Princeton University Press, 2020).

Angus Deaton

Writing for PS since 2015
14 Commentaries

Angus Deaton, the 2015 Nobel laureate in economics, is Professor Emeritus of Economics and International Affairs at the Princeton School of Public and International Affairs and Presidential Professor of Economics at the University of Southern California. He is the co-author of Deaths of Despair and the Future of Capitalism (Princeton University Press, 2020).

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0 Comments on this paragraph, 13 in all 13 Comments on this article

Mark Scher Jan 3, 2021

It looks like socialism is the answer. The current US system reminds me of the collapse of the Soviet Union and Eastern Europe. By the way ,they were socialist by name only.
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Kurt Kristensen Jan 1, 2021

A title such as "Deaths of Despair" ought to awaken even the most cynical person to listen to all those people they regularly dismiss as unimportant, or not sufficiently knowledgeable to be worthy of attention.

Our current system of economics may, indeed, be in need of a serious examination. Most working families in the US, as well as many other developed nations, have experienced significant social and economic head-wind since the mid-1970s.

Examples abound:

No longer was it possible for a family to exist with a primary wage earner. No longer was it realistic for children to expect that their mother would be waiting at home after they returned from school, and little by little customary benefits accruing to families after WWII began to disappear-No more Defined Pension Plans, No more family health insurance and very few affordable days to have a family vacation.

In tandem, a successful business-driven narrative led to federal tax policies that that have, between 1970-2020, reduced corporate contributions to public entities from over 60% to less than 15%.

As the authors soberly disclose, the jobs that supported the broad middle class economy up till the late 1970s have increasingly been disappearing, to be replaced by temp jobs, service jobs or small individual contractors jobs.

The "Despair" that the authors refer to are not limited to economically diminishing circumstances, it may also refer to a loss of Faith in our country such as that experienced by wounded veterans of all the failed wars. Or it may refer to the lack of faith in employers that they will treat workers fairly if they do a "a-job-well done" year after year.

Finally it may also refer to the loss of faith many young people feel looking at astronomical student loans to get a degree that might lead to a lasting professional career. The latter may also reference a deep sense of "Despair" when young couples figure out that they simply can't afford any longer the very real cost of paying for their joint student loans while also taking on house payments, health care payments and consider whether they can afford to have children.

Regardless of all these disappointing demographics, the people who have been sufficiently clever, lucky or family-supported to have made it should, perhaps, be reflecting on the statistical chances for survival of a social system with almost 50% of its population experiencing so much despair that a term such as "Deaths of Despair" is commonly understood.

For example,

How much would it be worth to fund quality day care and Pre-K school for all our children?

How much would it be worth to fully fund, either a college degree, or a trade-equivalent apprentice program for all our young people?

How much would it be worth to fund a 6-week family vacation for all families each year?

How much would it be worth to fund all pensions and health care by simply adopting a variation of the current Social Security and Medicare System?

It appears that all the developed world is just entering a significant evolutionary change in all our production systems that will use AI augmented robotics to replace an increasing portion of our work force, at the same time as the global population moves from 7.2 billion to 12 billion. These two converging developments alone guarantee that current challenges and complexities will escalate, both nationally and globally.

Enlightened leaders, political or corporate, might be comparing notes on how different nations so far have addressed the causative factors leading to an increase in "Deaths of Despair" in America. Some EU countries appear to have done a much more effective and compassionate job than the US has, so far.

Finally, perhaps it it might be timely to begin asking our children's teachers how our children are feeling? Are they Hopeful? Are they learning useful skills? Are they Healthy? Are they Afraid?
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Ben Leet Dec 31, 2020

The United Way charity has published an ALICE report since 2011, and this December it published a national report showing that in 2019 42% of U.S. households experienced "hardship" and by 2021, January, the percent could be 50%. Hardship is defined as not affording a list of seven basics: food, housing, utilities, healthcare, childcare, transportation and phone service. ALICE -Asset Limited, Income Constrained, Employed. Dan Alpert at Business Insider has published an article, Dec. 2, about the considerable burden of debt experienced now by all sectors of the economy, and the likelihood of a major financial collapse, a repeat, if necessary support is not forthcoming. The average income after paying federal taxes, says Bureau of Economic Analysis, Table 2.1, is $55,650 per capita. And even if you take a lower national income amount, the average household income, annually, is about $130,000. The top-earning 7% earn about 35% of all income, shows the Joint Committee on Taxation. And the RAND Corporationn published a report on Income Distribution claiming that the median worker income, full-time year-round, is now $50,000 but could be $92,000 had wage growth since 1973 kept pace with productivity growth. We have a major readjustment facing us -- I expect democratic determination will evolve a less unequal society. Time for a wealth tax and more, like the 1950s when the top marginal rate never fell below 90%.
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Gerald O'Connell Dec 31, 2020

Excellent piece, but not quite as pessimistic as it ought to be, perhaps. There is a whole section of the educated, professional middle class that will find its employment and social position under threat from the advance of AI. How will this group respond to a new-found precariousness? One scenario has inequality deepening and the group of people immune to it growing ever smaller. Another scenario notes that many revolutions emanate from a discontented bourgeoisie rather than from a dispossessed proletariat. My own hunch is that impending dystopia may be forestalled by a profound re-think on the part of a newly threatened educated social group who will have the analytical tools to identify and implement an evolved form of socialist thinking: http://oconnellomics.com/ai-automation-globalisation-and-the-inevitability-of-socialism/
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眼光 Canadian / China Dec 29, 2020

Only the rich will survive in the USA society . Even the wonderful Stock Market is up . Money is everything in USA .
- 眼光 Canadian / China Dec 29, 2020
  
  Land of the Free
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Edwin Hoffman Dec 29, 2020

The technocrats pushed the Chinese “lockdowns good” fiction on the rest of the world. The resulting mass confinement is torture. Watch and see what you’re doing to the children alone:

https://youtu.be/iSkbd6hRkXo

Many amongst the global influencers and decision makers should be tried and imprisoned for their role in crimes against humanity.
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rphelms1 Dec 29, 2020

The problem discussed is important and the prospects are that inequality in the US will increase rather than decrease. But the analysis of winners and losers is not very accurate. There are broadly two groups of winners: (1) tech, with or without BAs, and (2) the trades (electricians, plumbers, etc.) mostly without BAs. Everybody else is going to have difficulties. Your average BA from your average medium grade university is going to find progressively less opportunity and will wind up competing with your average non-BA worker. We are educating too many people to go after jobs in professions that are not that economically important and already have too many workers. The result will be disappointment and a feeling that the system is not working for them. The trades will have it the other way around: more work than they can comfortably do and they will be able to increase their prices.
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Eric Einhorn Dec 28, 2020

Useful reminder of the challenges facing the US economy and society. I STRONGLY recommend Case and Deaton's book.
- Pablo Pardo Dec 29, 2020
  
  Couldn’t agree more
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Leo Arouet Dec 28, 2020

Excellent article. The data showed here have tie with report of World Bank named The Changing of Nature of Work.
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