Deaths of Despair and the Future of Capitalism by Anne Case & Angus Deaton • Princeton University Press • 2020 • 312 Pages • $27.95
In 2017, 158,000 Americans perished from drug overdoses, suicides, and alcohol-related liver disease. That, as Anne Case and Sir Angus Deaton note, is the equivalent of three 737s crashing every single day for the entire year. Princeton professors Case and Deaton, in a paper published that year, famously coined the term “Deaths of Despair” to collectively refer to these three conditions. (They left out the consequences of the obesity epidemic our nation is also enduring, which arguably belongs in that same sad category.) They made news, a rarity for such a paper, because they found that life expectancy in the United States recently fell for three years in a row primarily due to these deaths of despair. Indeed, by 2017, the last three years represented the longest consecutive decline in the American lifespan at birth since the period between 1915 and 1918, which included World War I and the Spanish Flu pandemic, events that killed many millions worldwide. Current rises in deaths of despair seem to be a unique domestic phenomenon of the past two decades; they have increased dramatically almost exclusively in the United States.
Drug overdose deaths are the single largest contributor to deaths of despair. There were more than 70,000 drug overdose deaths in 2017, surpassing the total number of Americans who died in Vietnam. As former state health commissioner of West Virginia for two governors (including the current one), I was often asked why the drug overdose deaths are not only consistently higher in the Appalachian region than elsewhere but specifically so in West Virginia. In 2016, West Virginia was second only to Wyoming in casting the highest percentage of votes for Donald Trump. Could there be a link? In 2018, we conducted a social autopsy of all the drug overdose deaths in the state that occurred in 2017. We scrutinized each decedent’s life in the year prior to their death and the findings were compelling: White single males aged 35-54 years with a high school education or less working in blue-collar industries had a significantly higher risk of dying from a drug overdose.
In Deaths of Despair and the Future of Capitalism, Case and Deaton expand their groundbreaking research to book length, linking deaths of despair with the nightmare of the Great American Economic Divide. Case and Deaton systematically lay out evidence and facts forming the foundation for the argument that for today’s white working class, America has become a land of broken promises, disintegrated families, fractured communities, and declining hope.The triumph of Donald Trump was certainly underscored by unprecedented white votes polarized around education levels. Case and Deaton provide evidence that, driven by the low educational status of middle-aged whites as a primary driving force, the deaths are inescapably linked to the historic weakening position of labor, growing power of corporations, and a health-care system that actively participates in the killing of Americans while helping to
redistribute working-class wages to more affluent members of the society. The authors make the case that American capitalism, which has for the most part lifted millions of families out of poverty, has now reared its ugly head toward the white working class, creating a reverse Robin Hood redistribution system under political protection, a process known as rent-seeking. They find rentseeking behavior by corporations to be a major cause of wage stagnation among the working class and exceptionally American in nature due to the lobbying and political influence that sustains it. But it is a behavior, they note, that is potentially exportable.
Anne Case and Angus Deaton are both distinguished economics professors at Princeton. Both are emeriti; he won the 2015 Nobel Prize in economics. In contrast to his previous book, The Great Escape: Health, Wealth, and the Origins of Inequality, where Deaton takes an upbeat look at the remarkable 250- year story of innovation and setbacks that led to parts of the world experiencing sustained progress, he works here with Case to paint a much bleaker and more troubling portrait of the American dream in decline. They find the notion that every American has the opportunity to work diligently and then one day reach the highest echelons of wealth to be under attack from special interest groups representing corporations as well as politicians. This has been the case for the past half century. For instance, while the U.S. economy has been growing ever since the 1970s, growth has increasingly been focused at the top.
Case and Deaton begin by laying out their argument for why understanding the deaths of despair is fundamental to grasping the living conditions and widening societal gaps left-behind Americans face at work and home. They astutely organize their research into developing the reader’s understanding
of the links between deaths of despair and economic realities, as well as the expanding role of capitalism, lobbying, and politics in a common person’s life. They analyze issues such as immigration, automation, and the impact of countries like China on our economy. Finally, they provide recommendations on what to do to address the crisis. They write,
“Globalization and technological change are often held up as the main villains…Yet other rich countries, Europe and elsewhere, face globalization and technological change but have not seen long-term stagnation of wages, nor an epidemic of deaths of despair. There is something going on in America that is different, and that is particularly toxic for the working class. Much of this book is concerned with trying to find out just what that something might be.”
The working-class American population has not sustained proportionate benefits of prosperity. Prolonged decline in real wages is one of the fundamental forces working against less-educated Americans. Wage decline leads to job decline, and this deterioration in job quality and detachment from the labor force brings misery and loss of earnings, along with a loss of pride. As a result, the lack of well-paying jobs remains a leading cause of inequality and poverty, the very root of societal disruptions. Case and Deaton assert that the calamity for the less-educated white working class in many respects parallels the first wave of globalization, which actually hit African Americans as early as the 1970s and ’80s, when they started experiencing similar disadvantages stemming from evolving national and global economic trends, in addition to racism.
Deaths of Despair and the Future of Capitalism magnificently attempts to tease out facts from fiction with data and charts in a subtle but remarkably coherent manner, deciphering why we are experiencing some of the highest levels of inequality and poverty among the richest nations on earth. They demonstrate that, between 2008 and 2016, when deaths of despair were rising rapidly, income and employment for less-educated Americans was much lower when compared with the educated class. The recovery following the Great Recession
of 2008 disproportionately favored those with a college degree. At the core of their argument is that what distinguishes our nation’s inequality and poverty is a unique attribute: the implicit approval of the American society. Americans
understand that the current economic system is not equal. But they are focused on equality of opportunity rather than equality of results. This priority is a direct impact of the American Dream manifesting itself not only in the hearts
but also the minds of our people. Simply put, we believe that laborious work will one day earn us a coveted position as one of the wealthy elite. Consequently, some people, understandably, do not desire the lottery of the American economicsystem to be challenged before they have a chance of winning big from it. In the face of opportunity, Americans are willing to tolerate inequality. For instance, as they explain, there are “employees who have defined contribution
plans, invested in the market, have a direct interest in the market doing well, and thus are rewarded when wages fall or workers are replaced by automation.” Such a mindset fuels opposition to progressive measures and common-sense regulations. The rapid growth of corporate lobbying in Washington has all but ensured a political gridlock.
However, Case and Deaton make the case that this status quo may be changing. They find that the impact of the four-year college degree is increasingly dividing the nation. This gap is splitting America into the “haves” and “have nots” with respect not only to deaths but also the quality of life individuals
attain for themselves and their families. As this difference leads to an ever-widening gap in earnings, stature, and future opportunities, the family unit—its stability and therefore the social status in the community—is being threatened, especially for middle-aged white Americans. A dichotomous and segregated nation, one based on educational inequalities, is emerging.
At the same time, the Financial Crisis of 2008 and the Great Recession that followed undermined people’s confidence and trust in capitalism when harm was done to the ordinary people without the elites being held accountable.They conclude that it is not inequality itself that is unfair but the process that generates it. While emphasizing that inequality is often seen as the central problem of capitalism in America today, Case and Deaton state, “The problem with inequality is that so much of the wealth and income at the top is ill-gotten. Or put another way, the problem is not that we live in an unequal society, but in an unfair society.”
Case and Deaton align with the theory of Yale Professor Daniel Markovits and others that the so-called “meritocracy” embraced by most rich nations may actually lead to social calamity. The two-pronged assault on income and social mobility among the less educated may lead to what the British sociologist Michael Young, an architect of the British postwar welfare state, in 1958 presciently termed “the populists” (less educated) and “the hypocrisy” (the elite). (Young himself predicted a social disaster with the rise of “meritocracy,” a word he coined.) With evidence, Case and Deaton highlight how the two populations behave differently when it comes to everyday actions, which for the less-educated results in pain, suffering, addiction, and sometimes even death. They even appeal to our pathos when discussing the opioid crisis by stating, “Parents should not have to watch their grown children die . . . [C]hildren are supposed to bury their parents, not the reverse.”
They highlight that for those with lesser education, marriage rates are declining but cohabitation and child-bearing are not. Similarly, this group is experiencing declining attachment to organized religion as well as to their employers (and unions), often considered foundations for a meaningful life. For those thinking maybe these individuals have brought it upon themselves, the authors see it otherwise, as they assert, “These declines may not have happened without the decline in wages and in the quality of jobs which made traditional working-class life possible. But it was the destruction of a way of life that we see as central, not the decrease in material wellbeing.”
Case and Deaton are careful to point out that while globalization, immigration, and automation have and will continue to challenge the less-educated working Americans, these phenomenons are not the villains. It is, rather, the Machiavellian response tactics of the political system and corporations that have led to this unique American phenomenon. Case and Deaton attribute the loss of jobs for the less-educated white working-class Americans not just to declining wages but to a process that is fundamentally unweaving the very fabric of our society. Consider your living room as the well-furnished, wall-to-wall carpeted, most lavish part of your home that is embellished to impress any visitor. What job losses have done is not dropped the fancy vase or the piano; they have pulled out the entire carpet from underneath, leaving nothing but carnage. Offering only to replace the expensive vase becomes an insult.
Case and Deaton offer very pragmatic and politically balanced commonsense solutions not only to replace the carpet but the entire living room. They lay out policy and actions that would stop rent-seeking, control lobbying, and create pro-market measures designed to cease the misuse of market power. The approach is one of balanced incrementalism; to identify and act upon, with broad agreement, selected injustices that are most likely to have an impact. For instance, rather than call for broad antitrust regulations, the authors endorse the notion of having social media outlets like Facebook pay users for data usage. They similarly advocate for a modest increase in the minimum wage as well as increased transparency from lobbyists.
“We do not believe that the deaths of despair were or are inevitable. They are not happening at anywhere near this scale in any other wealthy country,” state Case and Deaton, signaling that we must work to stop or reverse the wage decline for less educated Americans to stop these deaths of despair. Blaming much of the American health-care system, they appeal to corporations and politicians alike to strengthen the safety net in order to minimize harm. Specifically, since drug overdoses are the single largest contributor to the deaths of despair, Case and Deaton promote the idea of limiting opioid use while expanding treatment in order to address the rising deaths and suffering. It is certainly feasible. In West Virginia, we were able to do just that–utilize the regulatory framework to limit opioid prescribing to only those with legitimate pain while expanding options for treatment including among vulnerable populations such as pregnant women and incarcerated individuals. And now, we’re observing declines in deaths.
As the American electorate trudges toward another presidential election, the nation is more divided today than it has been in a very long time. While the fuse has been lit, many of us have wondered whether the smoldering of today has the potential to cause more destruction in the future, whether other explosives await us, and if so, how we recognize and abate the problem before it destroys our nation. While the temptation may be to skip the conversation and go straight to the solution, understanding and addressing the root causes leading up to this great American rift is critical, and may dictate the future direction of our and other wealthy nations. Case and Deaton tell the most compelling story of the ultimate devil’s bargain we may have struck as a nation. This book is a must-read for anyone attempting to objectively understand our collective American pain as well as those gaining from it.