The Body Economic (24 page)

For a great many families who were barely managing to make ends meet, the cut to housing benefits threw them into financial chaos. During the recession, 93 percent of those signing up for housing benefits had jobs but could not earn enough money to keep pace with rising rents.

The Tory government's austerity measures tipped about 10,000 UK families into homelessness. Homelessness did not rise in the UK immediately after the foreclosure crisis, as it had in the US. But 2010 was a turning point, precisely when the government began cutting its housing support budgets. In those years, homelessness increased by 30 percent, just as homelessness rates began falling in the US with the introduction of its stimulus-financed Homelessness Prevention Program.
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These outcomes were not a surprise to the Tory government. In 2010, the British government's Social Security Advisory Committee (SSAC) reported that cuts to the Local Housing Authority “are expected to result in financial hardship, house hold disruption and displacement, and pressures on non-HB [Housing Benefit] budgets.” They even went on to question, given these outcomes, “whether they [the housing cuts] fulfil the Government's own criteria for effective, principled reform of the benefits system.”
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The Tory government also understood the health impact of austerity. A 2010 report by the Department of Health stated that the average homeless person could expect to live 45 years, compared to over 80 years for the rest of the population. Within five years of losing a home, it was estimated that persons who became homeless—even temporarily—were 4.4 times more likely to die prematurely than people of the same sex and age who kept their homes. And the government was made aware that over time, the costs of homelessness would outstrip any savings achieved through austerity. Shelter, the UK's housing and homelessness charity, published a report finding that the fiscal multiplier for housing was 3.5—so that for each pound in cuts, the economy would slow by a further £3.5. Already in 2011, the housing budget cuts were estimated to have cost 200,000 jobs in construction and housing maintenance.
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So if the government knew the immediate human and economic costs of austerity, there were only a few possible reasons to explain why they went ahead with the program. One was ideology—the belief that it is always better to have less government involvement in the economy and housing market.
Another was the mistaken belief that cutting debt would eventually boost the economy, and that homelessness and its trappings were a “price worth paying” for recovery—that short-term pain would lead to long-term gain.

The impacts of austerity were quick to manifest in infectious disease statistics. As more people were living on the streets in London, tuberculosis rates jumped. In total, there were 279 new cases in 2011—an 8 percent rise over the previous year. Homelessness was one of the major factors driving London's TB outbreak; other risk factors included drug use and jail history (which are themselves correlated with homelessness). One TB expert from the Health Protection Agency explained, “The risk of contracting TB is largely confined to a number of specific groups within London. These include the homeless, problem drug and alcohol users, prisoners.” This high-risk cluster of people spread the air borne epidemic across the city. As the director of the Health Protection Agency noted in 2012, “TB is one of the biggest public health problems we have.”
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Tuberculosis wasn't the only dire consequence of cuts to housing safety nets. Other public health problems associated with homelessness have also been on the rise after austerity. As the number of young people sleeping on the streets of London rose by 32 percent between 2010 and 2011, an increasing number have reported assaults and rapes, as well as a descent into substance abuse. To add insult to injury, the austerity didn't even boost the economy to improve the working prospects of the young. Instead, it coincided with a further slowing of the economy, such that the number of unemployed youth (aged sixteen to twenty-four) hit 1 million, a new high.
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The contrast between the American and British policy approaches—and the rates of homelessness that ensued—is stark. When the US invested in effective housing programs, it protected many people from the ravages of homelessness, even during a massive recession and housing crisis. But when the UK cut its housing budgets midway through the crisis, its homelessness rates—having held steady during the wave of foreclosures at the start of the crisis—began to rise.

Across Europe, the divergent experiences of the US and UK were recapitulated as different governments chose to pursue either stimulus or austerity in response to recession. We found that those governments pursuing the
greatest austerity under pressure from the European Central Bank and International Monetary Fund experienced the most damaging health effects of the housing crisis. And the burden of austerity tended to fall on society's most vulnerable groups: the homeless and disabled.

An illustrative example is Greece, where IMF austerity programs triggered the largest cuts to housing safety nets in all of Europe. Homelessness rose by a quarter, creating the conditions of crowding and drug abuse in downtown Athens that contributed to the spread of HIV. Greece also suffered an epidemic of West Nile Virus in July and August 2010—the first large outbreak of West Nile among humans in Europe since the Romanian outbreak in 1996 and 1997.
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While the differences in national data collection practices make it difficult to compare the number of homeless persons across European countries in an absolute sense, it's striking that homelessness rose in virtually all countries cutting their housing support budgets. Ireland suffered the second largest cuts to housing programs after Greece and experienced a 68 percent increase in homelessness, though its rates had previously been falling. Spain and Portugal also implemented deep cuts in housing budgets during their recessions, driving large increases in homelessness. The number of homeless in Barcelona rose 31 percent between 2008 and 2011, from an estimated 2,013 to 2,791. Portugal, similarly, experienced a 25 percent increase in homelessness between 2007 and 2011.
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By contrast, in 2008, Finland launched a new program to provide 1,250 dwellings for homeless people, with the ultimate goal of eliminating homelessness by 2015. The Finnish program focused on providing immediate access to housing—similar to San Francisco's Housing First approach—but went a step further by providing social workers to help homeless persons re-integrate into society. Rather than cut housing budgets during its recession, Finland's policy decisions led to a decrease in homelessness between 2009 and 2011, just as homelessness was on the rise in the UK, Ireland, Greece, Spain, and Portugal.
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While the US initially stood out as a success story, implementing a highly effective program to curb the health risks of foreclosure, there is now a danger that these gains will be reversed. The US housing stimulus will end prematurely. In 2011, the US Congress cut Housing and Urban Development programs by $3.8 billion, a 10 percent cut to a budget that was—prior to the
stimulus package—already at its lowest level in a decade after the Bush presidency had slashed social support programs, following the same ideological reasoning as the British Tories.
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These policy decisions resulted in too few homes for too many homeless people across the country. In Dallas, for example, 21,000 people applied for just 5,000 subsidized apartments in May 2011, prompting a stampede in the waiting line for housing applications, which itself led to at least eight injuries. In Oakland, 100,000 people signed up for only 10,000 public housing spots. New York City's homeless shelters burst at the seams after its austerity measures eliminated a rent-subsidy program. The city hit a record of 41,000 homeless people requesting shelter each night. As people were turned away from overcrowded shelters, homelessness was projected to rise again in the US by 5 percent in 2013.
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Meanwhile, the foreclosure crisis continues in the US, and California and Florida remain two of the worst-affected states. In Florida in 2011, the state suffered more than 25,000 foreclosures (about one in every 350 homes); at the time of this writing, foreclosures continue at a high rate. Duval County, one of the epicenters of the foreclosure crisis, is experiencing foreclosures at a rate of one in 254 houses, with an accompanying 10 percent rise in homeless people in 2011, the latest year of available data at the time of this writing.
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In concert with the rise in homelessness, Florida experienced the worst TB outbreak in the US in two decades. Ninety-nine cases were detected in Jacksonville, and TB has caused at least thirteen deaths. The CDC was called in to investigate, and concluded that the TB spike arose from Duval County's 20 percent rise in homelessness during the recession and the airborne transmission of TB in overcrowded homeless shelters—just as in London.
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While the CDC officials monitored the situation in Florida, news of yet another outbreak arrived from across the country—again, in Bakersfield. Things had not gone well since 2007. The California state government had decided to take the path of austerity, cutting the phone lines in some of the state universities that had helped detect the previous West Nile outbreak. About 15 percent of the public health workforce was cut. Following the large austerity measures, the California Department of Public Health's website announced in 2011: “Unfortunately, the California Encephalitis Project (CEP)
has discontinued its services due to funding constraints.” The program's past triumph in Bakersfield wasn't enough to keep its doors open.
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But in June 2012, the crows started dying again, and a seventy-year-old woman turned up at the hospital with confusion and multiple mosquito bites on her arm. West Nile Virus had returned.

This time, Bakersfield was on its own.

Healing the Body Economic

What do we mean by our term “the body economic”? It is, of course, a response to the term “the body politic.”

Here is a standard dictionary definition of body politic: “a group of persons organized under a single governmental authority; a people considered as a collective unit.”
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We adapt that format for body economic: “a group of persons organized under a common set of economic policies; a people whose lives are collectively affected by these policies.”

The body economic signifies not just the financial systems of which we are all a part, but the health effects of economic policies. As epidemiologists, we study the patterns, causes, and effects of disease. When we think of the body economic, we seek to understand how governmental budgets and economic choices affect life and death, resilience and risk, for entire populations around the world.

Of course, economic policies are not the pathogens or viruses
per se
that directly induce illness. Rather, they are the “causes of the causes” of ill health—the underlying factors that powerfully determine who will be exposed to the greatest health risks. Economic forces determine who is more likely to binge on alcohol, catch tuberculosis in a homeless shelter, or spiral into depression. They can affect not just risk but also protection, determining
who is more likely to get social support, maintain a roof over their head, or recover from a bad spell in life. That is why even a small change in government budgets can have large—and possibly unintended—effects on the body economic, for better and for worse.

What are the health effects of the choice between austerity and stimulus? Today there is a vast natural experiment being conducted on the body economic. It is similar to the policy experiments that occurred in the Great Depression, the post-communist crisis in eastern Europe, and the East Asian Financial Crisis. As in those prior trials, health statistics from the Great Recession reveal the deadly price of austerity—a price that can be calculated not just in the ticks to economic growth rates, but in the number of years of life lost and avoidable deaths.

Had the austerity experiments been governed by the same rigorous standards as clinical trials, they would have been discontinued long ago by a board of medical ethics. The side effects of the austerity treatment have been severe and often deadly. The benefits of the treatment have failed to materialize. Instead of austerity, we should enact evidence-based policies to protect health during hard times. Social protection saves lives. If administered correctly, these programs don't bust the budget, but—as we have shown throughout this book—they boost economic growth and improve public health.

Austerity's advocates have ignored evidence of the health and economic consequences of their recommendations. They ignore it even though—as with the International Monetary Fund—the evidence often comes from their own data. Austerity's proponents, such as British Prime Minister David Cameron, continue to write prescriptions of austerity for the body economic, in spite of evidence that it has failed.

Ultimately austerity has failed because it is unsupported by sound logic or data. It is an economic ideology. It stems from the belief that small government and free markets are always better than state intervention. It is a socially constructed myth—a convenient belief among politicians taken advantage of by those who have a vested interest in shrinking the role of the state, in privatizing social welfare systems for personal gain. It does great harm—punishing the most vulnerable, rather than those who caused this recession.
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