Socioeconomic Mobility Challenges and Policy Solutions for Health Equity

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• The Socioeconomic Mobility Crisis
• Moving Beyond the Myth of Meritocracy
• Policy Mechanisms for Poverty Reduction
• Strategic Investments Across the Life Course
• Education Returns and Rising Inequality
• A Global Phenomenon Requiring Global Solutions

The Socioeconomic Mobility Crisis

Modern economies present significant barriers to upward mobility. Dr. George Kaplan, MD, highlights a critical issue: two-thirds of individuals living below the poverty line in the United States work full-time. These patients are often trapped in low-wage service jobs that do not provide the benefits or economic security enjoyed by the middle class. Dr. Kaplan points to analysis by economist Dr. Pavlina Chernova showing that most wage-earners did not benefit from recent economic recoveries.

A profound threat comes from digitalization and automation. Research indicates that 47% of over 700 existing job types are likely to be automated away within the next two decades. This technological revolution is creating a great divide, potentially allowing only a highly skilled and wealthy few to access well-paid work while leaving 85-90% of the population with few economic opportunities.

Moving Beyond the Myth of Meritocracy

A fundamental shift in perspective is required to address these challenges. Dr. George Kaplan, MD, argues that we must move away from the notion that society functions as a pure meritocracy. Success is often not based solely on merit or knowledge but is influenced by a multitude of other factors. This understanding changes how we view poverty.

Dr. George Kaplan, MD, emphasizes that we must not see the poor as undeserving. Instead, we should view them as individuals who, like anyone else, simply lack financial resources. This reframing is crucial because it leads to the development of a completely different, more compassionate set of social policies aimed at genuine support rather than punishment or neglect.

Policy Mechanisms for Poverty Reduction

Effective solutions exist and have been implemented with varying success across different nations. Dr. George Kaplan, MD, explains that societal and monetary mechanisms can dramatically change income distribution. Tax and transfer systems in many European Union countries, for example, have been highly effective at reducing both child and adult poverty levels.

Dr. George Kaplan, MD, notes the stark contrast between nations: "France does a huge job of it, the US does quite a poor job of it." These policies allow for the redistribution of public resources, granting individuals access to essential services, education, and opportunities they would otherwise be denied. The interviewer, Dr. Anton Titov, MD, facilitates this discussion on comparative policy effectiveness.

Strategic Investments Across the Life Course

Interventions must be comprehensive and sustained throughout an individual's lifetime. Dr. Kaplan strongly emphasizes the power of early childhood interventions, referencing the stark "word gap" where children from low-income families hear 13 million fewer words and less complex language by age four. These early experiences directly shape the cognitive and interpersonal skills necessary for future higher-paying jobs.

However, Dr. George Kaplan, MD, cautions that investment cannot stop there. A highly educated cohort of young adults will still fail if there are no jobs available. Similarly, older adults without a supportive retirement system become a drain on society. The solution requires strategic investments at every stage of life, avoiding generational warfare and ensuring support from early childhood through old age.

Education Returns and Rising Inequality

The extreme economic returns to education and capital are not inevitable consequences of a modern economy but results of policy choices. Dr. Kaplan challenges the assumption that a CEO making 400 times more than a line worker is an automatic economic outcome. This disparity reflects specific taxation policies, corporate cultures that sometimes emphasize greed over social good, and a failure to view investment in employees as a benefit to broader society.

This has led to an enormous rise in inequality across many countries, a trend extensively documented by economists like Thomas Piketty. Dr. George Kaplan, MD, stresses that these outcomes "are not automatic things. They don't grow out of our biology." They are the direct result of decisions made by politicians and individuals, which must be constantly evaluated on whether they are pro-health or anti-health for the population.

A Global Phenomenon Requiring Global Solutions

Extreme inequality and hampered mobility are not confined to any single nation but represent a global challenge. Dr. George Kaplan, MD, notes that cities like Moscow and New York have the world's highest concentrations of billionaires, while many others struggle. This polarization is a powerful social force with worldwide implications, as wealth flows across borders— evidenced by Russian investors buying multi-million dollar condos in Manhattan.

Therefore, solutions must also be global in scope. Dr. George Kaplan, MD, concludes that we must think about how global practices contribute to inequality and, more importantly, how they impact the health and well-being of populations everywhere. A concerted international effort is needed to create economic systems that promote health equity for all. Dr. Anton Titov, MD, helps frame this complex global issue for a medical audience concerned with population health outcomes.

Full Transcript

Dr. Anton Titov, MD: Let's talk about how one can improve socioeconomic status and hopefully help in modern life. Socioeconomic lifts do not work nearly as well as they should. You are right in one of your works: many poor patients work, but often the benefits of work enjoyed by the middle class are not available to the poor.

Two-thirds of patients living below the poverty line in the United States were working full time. They tend to be employed in low-wage service jobs. Moreover, it has recently been reported that, in contrast to previous economic recoveries, most wage-earning patients in the US did not benefit from an uplift in the economy that happened most recently.

There is a striking chart based on the analysis of Dr. Pavlina Chernova that shows that, and I'm not at all optimistic about the situation, conditions will improve for patients with lower socioeconomic status. There is a recent Economist magazine article, "The Third Great Wave," which says the digital revolution is opening up a great divide between a skilled and wealthy few and the rest of society.

Research shows that 47% of over 700 job types that exist today are likely to be automated away, likely to be gone in the next one or two decades. The Economist article again states that innovations will allow highly motivated, talented, conscientious individuals to claw their way into the smaller lead of very well-paid workers. But the remaining 85 to 90% of the population might find little to do in the new economy.

That future is quite scary. As you wrote, it was estimated that in the first four years of life, children in low-income families would have heard less than one-third as many words from adults as children in families of professionals, amounting to 13 million fewer words for children. They also hear less complex sentences and more negative statements and prohibitions.

Language count and complexity are exactly the stuff that develops the cognitive and interpersonal skills in the child—exactly the skills that will become necessary requirements for higher-paying jobs shortly. That doesn't bode well for these children when they grow up and enter the labor market.

What can society, government, and healthcare organizations do to improve the lot of patients, given these fairly depressing statistics and trends?

Dr. George Kaplan, MD: That is a big question. Let me start by saying that we have to move away from thinking about the patterning of success in society as reflecting a meritocracy. It simply isn't the case in most societies that patients rise to the top based on merit, based on what they know. It is often based on many other factors.

We have to think about the poor not as undeserving, but as someone said, someone like you or me who doesn't have money. When we think about patients who are less fortunate in that way, it leads to a whole different set of social policies.

As we look across countries, we see an enormous variation in the extent to which there are societal mechanisms for helping patients to step up from a lower position in life. They vary enormously if you compare EU countries, for example. The tax and transfer systems reduce poverty levels, child poverty levels, and adult poverty levels enormously.

Still, there are variations: France does a huge job; the US does quite a poor job of it. I direct anybody interested to look at the many, many reports on these variations.

So the first thing is we have societal mechanisms; we have monetary mechanisms. This can change the distribution of income. This then allows public resources to be redistributed, as well as individuals to have access to things that they wouldn't otherwise have access to. That is one piece of it.

Another piece is we need to think about investments across the life course. There is no question now, emphasized by the example you gave: the child who's exposed to fewer words and develops less cognitive complexity. There is no question that early interventions dramatically alter the ability of kids to wend their way through a complex society to get the skills they need to do well.

But we also have to think about: we could have a highly educated group of 20-year-olds who finished high school, or 18-year-olds who finished high school, but if there were no jobs, they wouldn't do well at all. We could have a collection of older adults who had no resources because there was no retirement system, who would be a drain on society as well.

We have to think about strategic investments across the life course, not just at one stage or another, not engaging in some generational warfare.

Finally, we have to think about the argument about the increasing returns on education—monetary returns, economic returns on education. Many economists have pointed out, and that Economist article alludes to, that the fact that a CEO of a large corporation makes 400 times the amount that a line worker makes in that factory or company is not an automatic consequence.

It reflects taxation policies; it reflects cultures that sometimes emphasize greed rather than social good; it reflects a view that investing in employees is not just something you do to keep them, but also is an investment that rewards society.

So there is a whole set of kinds of interventions, socioeconomic interventions that do go on. They go on differently in different societies. Being unemployed in Sweden is very different from being unemployed in the US. These policies vary across countries.

We have to confront the enormous rise in inequality that has happened in many countries. The Economist has written about it; many patients have written about Piketty, the now-famous French economist, who has written about it. These are not automatic things; they don't grow out of our biology.

They are based on decisions that are made by politicians, by individuals. We have to constantly be asking if those decisions are pro-health or anti-health.

Russia has certainly become one of the most polarized societies. In Moscow, there is the highest concentration of billionaires in the world; New York comes every second. Russia is certainly a weakness, not in the last several decades. It is an enormous social moving force as well.

I am well aware that, in fact, I gather that some of these $80 million condos in Manhattan are being bought by Russians, so this is a global phenomenon. This is not just local. It means that we have to think about it globally.

We have to think about how global practices all contribute to it and, more importantly, we have to think about how those all contribute to the health and well-being of populations.