Don't turn off life support in times of crisis

New data showing the GFC's devastating effect on Europeans' health highlights the importance of a strong social safety net and health funding in times of economic stress.

Recession, fiscal austerity and cuts in public health funding kills people.

In a remarkable study published in The Lancet last week, eight academics examined the literature and statistics relating to suicides and health in mainly European countries impacted by the economic crisis that started in 2007 or 2008.

While they acknowledge there are few reliable up-to-date morbidity and mortality data, there are a range of other indicators across a number of countries that suggest a strong correction between economic performance, fiscal austerity and health.

Among a vast array of findings, the Lancet study found that there had been a 40 per cent lift in suicide rates in Greece by early 2011. Furthermore, there was a huge rise in HIV infection rates in Greece from just 10 to 15 people reported per year between 2007 and 2010, to 256 in 2011 and 314 in the first eight months of 2012. The study noted that the ending of some needle exchange programs, probably the result of cuts to funding, coincided with the rise in HIV infection rates.

 The study notes that between 2010 and 2012, Greece delivered a 25 per cent reduction in spending on medical services and goods, there was a 25 per cent reduction in doctors contracted to the public sector, an overall 15 per cent reduction in hospital costs and a 25 per cent reduction in physicians’ wages and fees. The number of public hospital beds fell 35,000 to 33,000. Little wonder there was a deterioration in the health of the average Greek citizen.

Another highlight from the study was the presentation of aggregate data that showed how worsening macroeconomic variables such as unemployment, GDP per capita and hours worked affected mortality.

In broad terms, a 1 per cent rise in unemployment was associated with increases in suicides and murders, but a decrease in road traffic deaths. The fall in traffic deaths occurred because unemployed people stayed at home and of did not drive to work. A 3 per cent or more increase in the unemployment rate triggered an increase in alcohol related deaths, according to the researchers.

In Greece and Spain, the unemployment rates have lifted by almost 20 percentage points in the last five years.

Critically, the Lancet study noted that the effect of rising unemployment was not uniform across countries and “could be mitigated substantially by social protection”. In other words, in Finland and Sweden where there is a “commitment to strong social support during times of crisis – for example through the use of active labour market programs – could have had positive effects on population health”.

In a powerful conclusion, the study found that job support from the government in times of aggregate economic weakness broadly maintained health outcomes for the population.

The study backed this up noting that mental health problems were twice as common in people who were unemployed versus those who were in employment but that “the negative effects of unemployment on mental health were less in countries with strong employment protection schemes than those with poor protection”.

A key aspect of the report related to Iceland, where the financial crisis hit as hard as any other country with an economic depression and a sharp rise in unemployment. Iceland’s governments, via a popular referendum, rejected austerity measures in favour of effective default on debt and a massive currency depreciation. Health funding was maintained, as was social welfare for the unemployed. The report found that “the financial crisis [in Iceland] seems to have had few or no discernible effects on health”. It noted, “the effects on health were almost imperceptible. Suicides did not increase. When the crisis broke, the frequency of cardiac emergencies increased slightly, but this peak subsided within a week”.

It is not clear whether there have been any similar studies in Australia of the impact on the number of suicides and health outcomes as a result of the policy stimulus and other measures implemented during the financial crisis from 2008 to 2010. Based on the figuring in the Lancet study, it is probable or likely that the number of lives saved from avoiding recession would run into the hundreds.

Any such calculations for Australia would have to take account of the Treasury modeling which reliably estimated that around 200,000 jobs were saved (or not lost) as a direct result of the policy stimulus measures as the global recession hit. The study, presumably, would also need to take account of the fact that health funding actually increased in this period. These two key influences should make it possible to credibly work out, counterfactually, how many lives were saved and how many health problems were avoided due to the policy stimulus 

It is now over to someone clever to prepare such a study for Australia. I am sure it will make interesting reading.

For support on mental health issues, call Lifeline on 13 11 14 or Suicide Call Back Service on 1300 659 467.

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