Credit crunch and public health

It is no longer a case of the banks and the bankers, although popular media headlines will still have you believe that the crunch was purely of the banks’ making and somehow they should pay for it. It is now closer to home.

Not only has lending dried up, the housing market has ground to a halt. The fantastic drops in the stock market mean many have seen their life’s investments and wealth wiped out in a matter of days. Those close to their pensions are hit the hardest, as the bottom drops out of their equities-reliant pension pots, but not all understand the impact. Suffice it to say that it is not just us younger people who will pay for the bailouts all our lives, but it is also people approaching retirement, many of whom may have to continue working.

As a result of loss of wealth, people are spending less, even in the growing BRIC countries which were supposed to be able to absorb the shock. However the growth in these countries depended hugely on their customers in the West, ergo, crunch time. Jobs are not just being lost in the value-added services sectors but also those in retail and in other sectors. This hits consumer spending power even more as people sit tight on their money.

It is unlikely that our health will remain untouched by the upheaval. 

Early research by the charity, MIND, suggests that debt and the spiralling cost of food and other essentials is affecting mental health of many adversely. It is not just the relatively poor, but also the formerly well-paid professional workers who are feeling the stress, and it is being termed the ‘Square Mile Syndrome’. Insomnia is reportedly on the rise too. However the evidence of the linkages between such macro-economic problems and suicide rates is mixed. A longitudinal study of Australian data suggested that there are gender and age related differences. It was seen that male suicide rates increased with markers of economic adversity, while the opposite pattern was seen in females. Age-stratified data showed that higher housing loan interest rates having a positive association with suicide in younger people and a negative association in older age groups. Indeed, during the Great Depression of the 1930s, suicide rates rose significantly, and fell with the improvements in the economy and reduction in unemployment in the 1940s. 

Is there no sign of hope? There may be some.

As some of you know, my other interests include Obesity and weight management, which was the case study of my research for 4 years. 

Last year I wrote a review of a paper on the lessons from Cuba’s experiences with the prolonged economic crisis of 1989-2000. Researchers from the Johns Hopkins Bloomberg School of Public Health, Cienfuegos, Cuba, and Loyola University observed the impact of population-wide weight loss due to sustained reductions in caloric intake and an increase in energy output. They reported that during this time, obesity declined, as did deaths attributed to diabetes, coronary heart disease and stroke.

Reviewing the paper then, I had written:

“This is truly a unique – if unreplicable and unfortunate – experiment. The lessons serve to strengthen further the literature on the benefits of weight loss and the association between obesity and ill health. However from a practical perspective, the study does not add much.

Finding a way to reduce population-wide caloric intake and increase population-wide physical activity is the holy grail of obesity policy. The success of such initiatives depends largely on individual effort and initiative. Recent developments include incentives and disincentives from the payer in the healthcare provision industry.

However unless we are motivated to improve our own health, which is not really happening, the holy grail shall remain a mirage, which gets further as we chase it.”

I may yet eat my words (pun unintended, but entirely suitable).

If we are in for a prolonged period of economic recovery, we may gain an inadvertent benefit with slimmer bodies, and a lower rate of diabetes, coronary heart disease and stroke. 

* The second half of this post is strictly tongue-in-cheek. However if we cannot keep a sense of humour alive and try to stay resilient, it is unlikely we will come out unscathed from this credit crunch. We are all in this together, for a change from America to China and all in between.

10 thoughts on “Credit crunch and public health

  1. Not entirely unfeasible, when you think about it, although the USA almost seems to follow different rules than the rest of the world when it comes to food culture. I started doing a lot more home cooking lately to save on restaurant bills, and it’s made me even more aware of the rows of utter junk in the big supermarkets which I can hardly believe people confuse with food. But plenty live on that stuff, and it’s still extremely cheap. Awful.

  2. Shefaly, what has changed since yesterday? Markets all over the world are buoyant. I am surrounded by people who are supposedly experts on stocks and shares but my personal experience is that whenever there is a bear sentiment, markets fall, it doesn’t matter how strong the fundamentals of a particular company are. Earlier the Indian markets were governed by Indian situations, after globalisation some goof up by regulators somewhere in US can lead to markets crashing in India. After very few years this happens, however reasons and villains are different each time.

  3. @ Shefaly : Oh dear. What about stress! Anyway I hope that people will again return to the good times in a couple of decades.

    @ Prerna : What goes up, must come down!

  4. That’s an interesting connection you made between health and the economic downturn. I am sure that by next year there will be studies telling us exactly what happened! :) :)

  5. I have also read of the post WWII rationing period that was very stressful (and expensive) when the UK became a healthier and a less obese place. People had to work harder and eat less – sound familiar?
    As for me – I will happily coach people out of their stress!

  6. I didn’t read any of the links, so take this comment for what its worth. I believe that an economic downturn will lead to more obesity and more people eating at dollar menu fast food places. The reason is simple: when you have a tight budget and you are rushed for time, where do you go? McDonalds (I prefer In n’ Out but thats a California thing!) or Carls Jr., or Arby’s or Taco Bell… you get the drift! With the amount of grease those guys put in their food, it won’t be long before people get fat!

  7. Shefaly, from what I’ve heard, credit crunch is turning out to be a positive catalyst for psychiatrists and psychologists! People suffering from emotional pressure as a result of the meltdown are flocking to these private practitioners. I do see a positive ray of hope though: With purse strings becoming tighter, people tend to cook more at home! I’ve seen my work colleagues not buying food from the cafeteria and bring food from home to save those $5. And home cooked food might be much better than an average restaurant dish. Now the negative: $20 that’s spent at Dominos might actually get spent at Mc Donald’s or Wendy’s or some other cheap fast food joint. :) If a person has a choice between spending $1 on a cheeseburger at McD and buying groceries and then cooking at home (which will cost more than $1 if you take into account utility bills and labor costs etc.), then he/she might go for that cheeseburger instead!

  8. @ Alice: Your observation about the US having a different food culture is corroborated in history. European travellers writing in the 1800s describe how American food differs in its appearance (generally larger sized produce), portion sizes (generally larger) and eating habits (a lot of gobbling and not a lot of savouring). It is projected that the proportion of food expenses spent on eating away from home is due to grow in the US but those were pre-crunch projections. The credit crunch may have put paid to any discussion of changing the structure of agricultural subsidies and they may now make it possible for people to continue eating as they did before. It is worth watching trends in this area though..

    @ Prerna: You make an observation about the cyclicality of markets which is great. However I think, so far, it is an under-explored aspect in the current crisis, where we have convinced ourselves that it is somehow all the fault of the banks.

    @ Odzer: The recognition and the acknowledgment of stress varies hugely between poor and rich countries. In poor countries, people carry on, regardless. There is no point calling something distress since there is neither the wherewithal nor the affordability for the services needed to address it professionally. However continued stress takes its toll on long term health of individuals. That is a real problem esp in societies where universal healthcare is offered and where the possibility of many more ill people in the future needs to be built into investment projections.

    @ Nita: I think a year may be too short a time frame to assess the long term ill effects of the credit crunch on public health. But in the next 5-7 years, we may see some interesting, if not entirely desirable, data on this matter.

    @ Meeta: I think post WW-II was also a time when society’s expectations – and dare I say, the fabric of society and the fibres of an average citizen’s character – were quite different. After years of being used to consumption and plenty pretty much on demand, it is harder for many to cope. And although I wish you well on the coaching services, I am not sure many will have the money to afford you! :-)

    @ pseudoKu: That is also a possible pathway but not one that any public health analyst would like to see. We can only wait and watch.

    @ Ruhi: You raise a great point about the effective price point at which a consumer may be operating, but I think you assume a lot of rationality. If people eating at McDonald’s regularly – for instance – took into account all the direct and indirect costs of ill-health and obesity, including sick days, related diseases, early mortality etc, into account, they may choose otherwise. But they do not. There is a socio-economic divide at play here. People who are relatively well-off plan more into the future; those who are poor probably do not and live in the here-and-now as they get paid daily and spend daily.

    Which brings me back to your point about therapy. An American friend of mine in California is both a dental surgeon and a clinical psychologist. Her experience suggests that while dental care is deemed essential, psychotherapy is not, unless covered by insurance with some sort of guarantee that the premia won’t go up. In the US, where many people’s health coverage is related to their jobs, job losses will inevitably result in increased under-insurance or non-insurance. Do you think people may continue to pay for therapy under those circumstances?

    @ Deepali: I agree. Cuba is not generalisable and indeed, isolation itself may have been beneficial. But then one could argue that if we weren’t so connected, the credit crisis may not have assumed such enormous and global proportions as it has done, couldn’t one? The cause and effect threads are so difficult to untangle this time around.

    Thank you all for contributing your views!

What do YOU think?