Since the economy tanked we've seen numerous metrics used to describe the effects that mortgage brokers, ratings agencies, bankers and hedge fund managers have precipitated on the nation and the world.  Some of the most common measurements are increasing unemployment rates, a significant decline in the growth rate of the Gross Domestic Product, lost value in the stock market, all accompanied by increased fears of inflation/stagflation/deflation.  Other measurements, such as human sickness and death attributable to the economic downturn, have been largely ignored to date.  Linking specific deaths and illnesses to economic conditions is difficult.  Researchers who have attempted to do this with past recessions have had to rely on measuring changes in population mortality and morbidity rates (before, during, and after economic downturns) on the assumption that changes in the population rates will correlate to an economy-wide shock, such as recession.  In time we may see statistics that quantify the impact of the current downturn on national mortality and morbidity.  A recent article in the British Medical Journal, informs us that the collapse of the Russian economy was associated with a significant increase in mortality among working age men in former Soviet countries. Similar results were indicated in a study subsequent to the restructuring of the New Zealand economy.  Counterintuitively, researchers have heretofore, found that death rates in the US actually decline during economic downturns . They surmise that in our wealthy society, economic downturns reduce exposure to risks such as drinking, smoking, obesity, driving to work, and exposure to infectious disease and work-related stress even as stress increases in other ways.  However, previous US recessions have not been as severe or widespread as the current downturn. The impact of the current economic recession may well reach a tipping point where the gains from reductions in lifestyle risk are offset by increased illness and death.


We are starting to see some leading-edge statistics that point to this.  This article describes a recent increase in suicide attempts in Charlotte, NC, which is home to Wachovia and Bank of America, two banks especially hard hit by the crisis and where the impact on employment has been particularly severe. It documents a recent rise in mental health referrals and suicide attempts over the same period last year and surmises a connection to economic factors.   On a Tuesday night in March this year 10 people were admitted to the Carolinas Medical Center in Charlotte for attempted suicides.  One of the physicians on duty expressed his belief that the increase in local suicides is related to the economy.  March 2009 correlated with the stock market hitting 12-year lows, and area unemployment had doubled over the previous year, as well as area home foreclosures spiking, with more than 1,000 filed - a first for any N.C. county in one month.  

That's the simple part of this equation.  Suicides may account for far fewer deaths as a result of the recession than deaths from other causes.  Consider the newly unemployed, many of whom may have been skating by even in the go-go economy preceding our present economic paradigm.  There will be no golden parachutes to carry them through these tough times.  If they're lucky, they have a COBRA health insurance policy for themselves and their family so long as they can continue making monthly payments at the reduced rate granted RIF terminations for the 12 months following their severance from their jobs. Of course, even at a reduced rate, it will be difficult for most to cover monthly health insurance premiums, rent or mortgage payments, car payments, and food costs out of monthly unemployment benefits. If they're a bit luckier, they'll be able to afford the undiscounted premium on that policy after 12 months when their COBRA benefits expire.  And if they're really lucky, they will have no pre-existing health conditions in the family, and as such will avoid dramatic increases in their health care programs' cost at the end of their 'grace' period with COBRA.  Even without a pre-existing condition, they are likely to see a substantial increase in their monthly premium after the first twelve months, as they are required to pay both their employer's portion of the premium as well as their own (anywhere from $1000 per month and upward for a family of four).  If they fail to meet these hurdles, you can bet that they'll be postponing, or eschewing medical treatment altogether for illnesses that may befall them.  One thing the wealthy may not understand, is that food and shelter always trump medicine.  While we can't live by bread alone, we most assuredly can't live without it. And a roof over our head, especially when it may represent our one sole investment, is something most will try to preserve at the expense of medical care.  There's a baseline, below which human stress, manifests in disease, disability, and death.  More people are going to be at or near that baseline as a result of the calamity on Wall Street.

Those who retain their jobs, but due to concern over their job security, may be scrimping by purchasing less healthy food, and again, neglecting health care, as a means of saving money in the event of a job layoff will drift closer to the edge as well.  Many small business owners may be skating by on decreased revenues and facing similar decisions.  The net result is the same.  Increasing numbers of people will slide lower and closer to that baseline beyond which their health is at risk.  

These considerations are applicable to the US and to some extent the other developed nations.  All of the other wealthy, industrialized nations have a universal health care system that will help protect their citizens from endangering their health through neglect during economic downturns.  Concurrently, the same process of attrition in actualized health care is occurring abroad in less developed countries.  One of the major differences is that in such countries, the population is already living closer to the baseline and more of them will more rapidly slip below it.  Here's a measure that may help 'quantify' this:  Singapore, the world's busiest port for container traffic, recorded a 19.6% decrease in traffic in January, followed by a 19.8% drop in February.  A roughly 35%  reduction in shipping in two months.  These containers are filled with small manufactured goods, everything from ping pong balls to furniture and electronics.  This precipitous drop in shipping correlates directly to a coinciding drop in the production of those small goods.  The drop in production likely correlates to a similar decrease in employment in the surrounding developing nations and at the loading docks in Singapore.  You can see where I'm heading with this.  A lot of people are going to be scrambling to keep their heads above that baseline thanks to circumstances that brought us our current economic fiasco.  I can't help but consider investment bankers' demands for bonuses on the heels of the meltdown, as the callous extortion of more money from a world all ready put at risk from their unregulated financial gambling.  

The so-called 'World Economy' is so intertwined, even those countries with a significant portion of their population engaged in subsistence farming will feel pressure.  Stresses on local resources will increase as factory workers move back to rural areas in order to make ends meet as jobs dry up in urban areas.  Every developed country has felt the hit as well.  Some more painfully than others, but no one has escaped unscathed from the economic meltdown.  In this case, suffering truly is universal, and people around the globe will die as a direct result of a failure to adequately regulate the financial markets in developed countries.  With the integration of world economies, we cannot afford to put the world's economic health, or ours, at risk nor risk our population's physical health at the hands of "investors" gaming the financial system.  The fact of our interdependence with the rest of the world demands we and other nations regulate financial markets and products in a meaningful way.  By that I mean that there must be full information about the structure, content, and risk of financial products and they must be priced in such a way that they reflect their structure, content and risk. The risk component in such products can no longer be allowed to be obscured.  Without such oversight, investors (as opposed to speculators) will be reluctant to invest.  Without such transparency the financial sector, which had become the powerhouse of our economy, will sputter along, unable to lend to manufacturers and small business owners, unable to fuel the innovation and commercial enterprise that have been the trademark and economic salvation of the United States since its inception.  In addition, to regulating the financial market's products, we need to monitor the ratings agencies and eliminate the financial conflicts of interest that produced their inaccurate and self-serving ratings that contributed to our current crisis.  

Now that the initial panic associated with the financial markets' collapse has abated, those responsible for the system's demise are arraying their lobbyists to resist federal intervention into their activities.  We must make sure that the laissez-faire, hands-off modality that began with Reagan in the 80s and hit its' zenith under Bush43, does not continue.  Financial innovation does however have a distinct up side.  At the same time that transparency is increased and the financial sector is policed, we should remember that, and strive to not stifle the market through overzealous regulation.  Based on what I see our legislature producing, as industry lobbyists rotate through their Capitol Hill offices, I expect 'overzealous' regulation to be a remote possibility, so free marketers take heart, (and the rest of us "en guarde").  I have no doubt the skids of our government will still respond to a thorough greasing with that special green lubricant that has always paved the way to corporate advantages. 

When a financial market successfully prices and spreads risk, it is the power generator of any capitalist economy, fostering invention, entrepreneurship, and economic growth, which benefits us all.  The key to that success in pricing is making the products transparent to their risk elements, something that has not been done to date.  We can't afford to ignore instituting smart regulation of our financial markets.  Trust in these products and the market plays a bigger role in the long term health of our economy than was at issue heretofore.  Without legislating to ensure and restore that trust, the market will scare off many investors, leaving the playing field to the speculators as the economy limps along.  Our economic as well as our physical health demand our financial market shift toward transparency.  The rest of the world demands it as well if we are to restore confidence in the market that at least partially reflects the strength and stability of the centerpiece of the worlds' international reserve currency and continue to enjoy the economic benefits that are derived thereof.  The US and the world cannot tolerate opacity in financial instruments that put our physical well being, as well as our economy at risk.