comments 24/7 on facebook and twitter. >> next on booktv, doctor sanjay basu reports on the correlation between health and economic issues and talks about the rising rates of things like heart disease and suicide and hiv as a result of government cuts and social and health spending. this is about 40 minutes. [applause] >> thank you. thank you for coming. i'm going to talk for about 30 minutes or so about some data. but i will present to you is data discussing why we might think about the recession, not just in terms of stock markets and economic growth and debts and deficits. but in terms of our health and the public health more genuinely. to do so i will present what i
found initially is somewhat of a confusing puzzle. and that was perhaps best captured in this old usa today newspaper clippings. but it has been repeated a few times in a variety of different outlets. the notion that could recession be good for you. the headline confusing confused me at first. i had assumed that during the recession. matt, peoples health insurance would be lost. they would stop paying for medications, they would be depressed, they would turn to alcohol. and this and other news stories were based on a series of studies that suggested during recessionary. , unemployment is associated with improvements in life expectancy, which i found really confusing. and what i want to do is present what i would argue as one solution to this apparent puzzle. in presenting the solution, i think that we can gain insights into why we might be asking some
of the wrong questions when we correlate the recession to a lot of different things. but i will do his first talk about how we might learn from natural experiments and very similar communities and cities, states and countries experience the same or similar recessions and decided to take different policy avenues, different strategies in response and ended up in very different places in terms of public health. ultimately the goal will be to say something about what the role is a safety nets and answer that ultimate question that seems most apparent right now, which is social safety nets. and are they effective. if so, which kinds. so let me return to that puzzle, the conundrum about why during the recession people seem to have found increased life expectancy. perhaps if we are going to learn from any major recession, the great depression is the best template that we can have. during the great depression, in
fact there were numerous reports of death rates dropping around the country, which seems strikingly odd, given that at the same time there were lines and some other features that we learn about with regard to great depression. one possibility might just be that the statistics are biased. maybe they are just keeping track of people that are insured. those people are just the uninsured. but it turns out that the public health service, what has now become part of the cdc and other agencies, went around the country and did similar surveys and found the same declines in overall death rates. some of the clues for what might've been going on back in 1933, traffic accidents have dropped for the first time in the history. and indeed, if you were to look at indicating a recession, such
as overall gdp or income on the left and overall death rates on the right, they almost look like mirror images of each other. death rates falling at the same time that the recession hit. but this serves as a good example as to why it is is part of aggregate data. if you look at states, the states with the highest gas prices, they ended up with different people driving and these are the pre-ralph nader days that we are getting into, where getting into an automobile accident and have a seat attached to it and it was almost universally fatal. hidden behind a decline in traffic, probably a lot more important things going on people's health. and perhaps the most obvious to explain is the dramatic spike in suicide rates that was hidden beneath the traffic accidents, such a large cause of death that their decline mass all of these
other increases at the same time. producing this weird correlation between rising life expectancy, reducing death rates, and changes in the unemployment rate. but here i think is another important lesson, which is that suicide rates did not increase universally across the country. but in fact suicide rates and alcohol rates and other rates of diseases that are loosely associated with unemployment are very clearly associated with those becoming unemployed only increased in certain areas more than others. and in some places actually declined. so that is the natural experiment where we can analyze why these variations seem to be occurring. one of the most important was between states that decided to implement major parts of the new deal and states that did not. particularly in states that have rapid reintegration programs of it we can get back to work rather rapidly and although the
alcoholism is also affected by probation at the time. the other interesting thing is dramatic declines in infectious diseases in some states, particularly tuberculosis and association with programs that provide a rapid rate housing. so we beginning to see the hypothesis that aggregate death rates are affected by confounders but to really answer a story about what might be happening between with with ultimate health outcomes, we have looked at data. detailed data. while the great depression has this average the rough data sources we have to look through more modern recessions in order to come up with the answers to this question.
so i will look at three recessions, the russian mortality crisis, as it is often called, where similar populations all had this at the same time and had very different outcomes. we look at the east asian economic crisis which had roots very similar to our own recent crisis in terms of having a real estate bubble. and parker said the drinker and great recession. looking first at russia, and during the collapse of the soviet union a vast array of different populations experienced a recession around the same time as the ussr collapsed. but otherwise demographically similar populations ended up having very different health outcomes, even if they started at roughly the same health status. what was particularly weird was that a number of demographers from france and russia and the number of countries were
observing the same trend, which you expect that in bad times the people that would hurt the most are the very young, like incense, and the very old. but what was really strange about the russian crisis wasn't nearly the opposite happened. young robust man had this huge spike in their death rates. in variety of theories about what could happen is maybe the russians have been kind of taking their data before the collapse of the soviet union. it would not have been unheard of. they were often amplifying the number of young men that were around in order to impress people by the size of their potential army. and that turned out that they had fudged a bunch of numbers in that context. some independent demographers have been worried about this. so in france they had been keeping this -- keeping track of this young male population for this reason. well before our current nsa
surveillance during the cold war. and in fact confirmed that this giant spike actually happened. it was dramatic is that kind of like the great depression, it did not occur everywhere. but only in a few cities and counties and states. we saw this dramatic variation which announced several million people and locations in russia that underwent what has been called shock therapy with dramatic austerity. so here is the idea that russia needed to get back on track with the marketplace. and the concern was if the government had too many obligations, it would go up into debt, and it would never really recover as a stable economy. so the recommendations of a large group of people were to dramatically cut social programs
that were previously in existence when the ussr was still intact. this included things like rapid job reentry programs, child care, a variety of housing programs and major alcohol programs. and not everyone agreed. countries agree that this is not going to be good. it won't be a good idea. so they sort of refuse to follow the advice while russia and some others sort of went full with it. in that setting we found a massive convergence including this dramatic decline among young men in those who refused shock therapy among whom the death rates were essentially part of. even though it was part of our times. so we end up sort of seeing again, just like in the great depression that depressions don't necessarily manifest in bad public health outcomes, but it could be a matter of policy
choices. the same pattern emerged and they are not very different from the recent crisis. they had a massive housing bubble that it was going to be the technology future and so many buildings were being built at bangkok have five times the population in terms of the number of empty apartments that were prior to the crisis. but like every price bubble, the supply was greatly outstripping the true value in what was really going on. eventually investors pulled out in the context of this big currency crisis and the same thing happened is what happened during the apparent recession, which is essentially ended up with a giant bursting of the stock market in the area and what is called a subsequent liquidity crisis that no one can get loans because all of the money has dissipated from the
system. and there is a great about what to do. and the international monetary fund at the time, it's a major international bank that helps countries in tough situations. so that we don't want you guys going into inflation. they want to cut down your spending dramatically. in order that you don't have major government obligations and they preserve the value of your currency. under a lot of protests, malaysia and to some extent south korea refused to do that while their neighbors again kind south korea refused to do that while their neighbors again kind of pointed to this wholeheartedly. the same sort of thing emerged once the spikes in suicide rates and malnutrition and others were going into the shock therapy of the austerity. at this time a chevy had entered
into east asia in the gray. this is the year -- these are the years where thailand was viewed as a model for the prevention programs. one of the major programs that were cut in the setting was the hiv prevention program in thailand and one saw a huge spike in the subsequent infectious disease rates as people with hiv are getting all sorts of secondary infections. the malaysian experience was essentially flat. it was particularly ironic was that malaysia and south korea recovered first, which is quite surprising because they had spent more. this really emphasized one of the major policy lessons. the idea has often been this or you will recover faster. you'll go into an inflation and you need to cut down our tighter
belts now for the future. this is shown in somewhat of a false i economy. but the answer is really written in the 1950s and only recently reiterated, which is that when countries are in these sorts of liquidity's crises. and they expand to continue their business and essentially the government needs to do the opposite of what they seem to do. one should pay off the debt and you don't want to be in debt as a household or an individual. you do not want to continue to accrue interest. and governments need to do precisely the opposite. including growing the economy out of the debt, you need to have stimulus. the noxious stimulus in the form of stimulus to the banks to others, but also those two safety nets is the poorest are
often those who spend a vast proportion of their income. and as i will show you when i get to the united states, we will see that a lot of safety nets actually preserve the business cycle and help us to grow at a short-term debts to pay off longer-term debt. the imf did recognize this after the east asian crisis occurred, they actually, for the first time, issued a formal apology and it took five years. but it was one of the most erratic apologies from any international institution. and getting around to our current recession, we see again a vast divergence across the country. you might have heard recent reports that alcohol drinking has gone down with the recession in the united states. it is a bit disingenuous. alcohol sales have actually gone down. and drinking has diverse across the country. most people have bought one last at trader joe's, as they have
less money in their wallet. about a million people, particularly young men who have had trouble finding work or were unable to maintain work, they have started frequent binging. you see this vast aversions within the population. among the young men you see emergency room visits, injuries, and other alcohol-related things. on average see a decline in overall drinking rates. and this is sort of the two america and the danger of these aggregate statistics. we see vast aversions is within europe all people are commenting on your of being in a universal recession and in fact that is not true. everyone is talking about greece, but before we were talking about.com everyone was talking about iceland and then we kind of forgot about iceland. it was of course, the first country to experience major part of the recession and relative to
the size of its economy, it has experienced the largest recession and global economic history. all the banks collapse. they have invested in u.s. mortgage-backed securities and iceland has a strikingly recovered at all greece has not in the political and economic situations between the countries are quite different. iceland doesn't depend on germany or other members of the eurozone for bailouts or assistance, nor is it restricted by the politics of the emu. and what they did is rather dramatic. they said that, okay, we have been recommended by the imf and others to undergo dramatic austerity and reduced short-term deficits and maintain your currency and producer obligations so you can recover faster. the number of ministers, including the health minister did protested the idea to eliminate this and a number of other social safety nets as well. a rather dramatic move for a
politician. so for the first time since 1944, iceland did something rather incredible, they had a countrywide vote that use social media in all and all these other things to have a constitutional amendment and put it to a vote. even though the debt was with an 800% of gdp, they asked something very simple. they said that a small group of people who are in charge of the banks have invested all of our money and mortgage-backed securities and it has flopped. and we have two options. one is to cut all of our social safety net obligations and use government taxpayer money to rapidly pay back all the foreign creditors. the other option is to do loan repayment programs. payback slowly over time. while preserving our safety nets at home. most people understandably voted for the second one. when we investigate the subsequent effects on iceland's public health, everything is essentially flat. some health indicators were
slightly improved, like sleep quality. but there is absolutely no increase of suicide, alcoholism, we couldn't find anything among four different groups of independent scientific investigators. there is only one blip and that was in week 52 of the recession, a sudden spike in respiratory emergency room visits. when we investigated what happened, it turns out that a volcano erupted and had pretty much nothing to do with the recession. i can't pronounce the name of the volcano and involves a lot of confidence. so greece win a very different route. they underwent this idea that they must be able to help us quickly get out of this recession. to quickly cut the public health by a tremendous degree. ultimately ended up end up having higher public health spending which has confused a lot of spending. it's not confusing at all if you look at the time.
the short-term cuts resulted in complications of ended up having to pay much more from the epidemics, for example when they had a 40 to 50% unemployment rate in this hit the market which has driven enough. including the various hiv and drug rehab programs were cut and one had this dramatic tenfold rise in hiv infections, which required in turn resulted in subsequent spending to take care of the hiv. similarly, a malaria epidemic has actually broken out the first time in decades as the mosquito spraying program was cut and cost about 10 times more to control than it does to prevent. we are seeing the same thing unfold and it was quite embarrassing from the state department which had a conundrum. for the first time they had to issue a warning to american travelers about going to a western european country which
produces problems for our trade agreements. now we see the same kind of trend in the u.s. states. in the u.s., it all collison and suicides reduce these spikes overall and they are very heterogeneous. it's not across all cities and towns and states and even similar would face massive unemployment and it seems to relate very strongly to a certain set of social programs that i will talk about. the social programs are the answer to a major question, which is why unemployment is and always correlate to the suicide rates and we have been taught that this is not predation and that is precisely the point and why we want to investigate when the correlations don't occur. unemployment rates very closely are followed by suicide rates. but in places like finland, the
suicide rates actually continued to decline. so how do we explain this and what are they doing? is it just that the swedish are so robust? my swedish friends would like to think that. but it is not true. it turns out that we investigate a slew of different programs that people are exposed to. one set of programs seems to be particularly effective. at preventing these recession associated professions and other health related problems. it is not in spite of my position. it's not health care spending that something called active labor market programs in these programs are sort of hard carrot and parts to it. when someone becomes unemployed, they do that only on the condition when they also and roll in this program.
it involves a person to assist them with actively work that anticipate to find part-time employment and reintegrate out into the workforce. it turns out that preemptive spendings both an economic stimulus and that paying for itself in the downstream of cost. and a question and maybe it's like the european thing. number of us have worked on these randomized controlled trials in the u.s. in detroit where people randomize it in whatever go off on your own and good luck to you. or this kind of active program. all of the cities, the same have
been found of reducing negative health outcomes as a side effect of really what is ultimately economic jobs. and we were seen as implemented across the u.s. much of it seemed to correspond to stimulus, where is and it ended in an austerity program. and there is a triple digit recession that we are starting into. and this ended around the time of the sequester when we started flattening out in terms of our recovery. on the same time the imf at issue in turn issued a major policy document in public statement from its chief economist, which is basically said, whoops.
and what it amounts to is the following. that all of the advice during the east asian crisis was based on an assumption of one number. that is for every dollar of government spending, how many dollars do we get back. the imf and others had assumed that it was about .5 and a little footnote to an earlier document, you can find the reason is because it was a nice round number and that is about it. four different groups including us have said earlier recessions, what we mean by getting back. the kids are job security programs, what we do to stimulate the economy with business growth and overall gdp. and it is actually a dollar and
70 cents and we don't always end up with the same number. germany had figured this out a while ago. and they were chocolatey mess for themselves and actually decided to undergo stimulus internally while recommending the opposite for greece. texas during the 1980s, california and massachusetts actually help this, which no texan politician had found. and we have seen is manifesting out as changing in government spending have correlated across a number of countries. of course, this begs the question and no fiscal bonfires go beyond it would have been around to prevent government
spending. but argues for a data driven increase in what to spend on. exams are a good example and a number of people have concerns that any time you do a safety net program, welfare will be coming in and people will be writing the system forever and we will be cheating the system and so on. very good studies. one recently by the editor of the american journal of economics. they found that there is essentially no data to support these notions. quite a bit of data is the opposite and the general welfare assistance, people will come off as economy recovers and furthermore the kids are particularly high because the people that are eligible for food stamps are often not spending on other things when they are unable to get food stamps. there is a classic dilemma of
the heat or eat conundrum where people can either spend on their heating or they can spend on food. entering. where they are able to get food stamps, peoples other spending is actually able to stimulate the local economy to watch much more than what it costs. just as a pure account in the net result is actually a deficit reduction. and i will say that it is important to recognize that it is difficult to find funding and the recessionary periods. medicare and other programs are classically programs where you have less of a tax during the recessionary periods. so how are you going to fund safety nets when you need money for them the most? you can do the deficit spending. but is there a better way as well? some of us have been working on this international initiative of which the goal is to simultaneously fund the types of programs that we need and we
have the least amount of money and find a novel funding source and also discourage the kinds of things that led to the reception. we all know that risky investments led to our recession. and very few of us actually participate in this. when talking about a lot of mortgage-backed securities. point is, .05%, which is based on the old idea and this includes hedge funds and others that participate the uri don't put in retirement accounts. this fee seems incredibly small, but when you are transacting hundreds of millions of dollars, it ends up on the order of 5 billion or more with encouraging heavy transactions. naturally because of this mechanism, the pool of this money will naturally increase as
people are undergoing an engaging in the highest risk transactions putting the safety net pool in and vice versa. the reason that i would argue for such a system is that while we may be in a unique time, it is actually not that unique. if you look at periods of recession over the last several years or decades, you haven't had a recession this large. though we have had many recessions. it is actually somewhat surprising when we are not in a recession if you look at the number of things have taken place over the last few decades. my favorite is the tequila crisis of 1995. but we have price bubbles in a variety of commodities all the time. i will end by saying that essentially what i have learned from understanding this data is that if you were to adopt the physician's mantra and apply it
to your social and economic policy, we might be better at offering people against these economic shocks and that we have quite a bit of beta to understand what to invest in terms of safety in what they read for us. i will conclude by offering this quote. i know it it's long, but i believe it's worth talking about. a speech from robert kennedy, he says our gross national product now has ove he says our gross national product now has over $800 billion per year. that gross national product was adjudged the united states of america by that, it should count air pollution and cigarette advertising to clear this end the chills are people that break them. he counts the destruction of the redwoods in the chaotic sprawl and it counts napalm and nuclear warheads and armored cars to fight the right spirit accounts for television programs and the
gross national product does not allow the health of our children and the quality of their education and it does not include the beauty of poetry or the strength of our marriage where the intelligence of our public debate and it measures neither wit or courage neither our wisdom nor our learning or everything in short except that which makes life worthwhile and it can tell us everything except why we are proud they are americans. i will and without an thank the many people that have i worked on the data and analysis that i've talked about. i will also take any questions that you might have.
[inaudible conversations] >> i saw a book of you today. sheri fink, doctor sheri fink wrote about the hospital in new orleans and i'm wondering if you are aware that situation and how you would respond to that in light of what you have told us today. >> okay, so to give some context, this hospital in new orleans has a number of situations going on. but a number of locations around the country are suffering such extensive deficits and debts that hospitals are closing among the sort of safety net group and among some private hospitals we see sort of a cherry picking phenomenon, which is related to this post during the recession and cents. i did not talk a lot about health care and health care insurance and how that is sort of affected during the
recessionary periods. but i will say there are very interesting studies back in the 1990s of the portion of health that we could buy the we give everyone universal health care insurance and if everyone had a fantastic perfect surgery and so on. how much could we improve the u.s. health care? without commenting particularly and i don't have any details of their financial situation. but from what i understand, the studies by that essentially everyone had perfect health care, you could buy between 15 and 20% of our preventative debts, which is really low. the question is where does it come from and why we talk about the social phenomenon. it is because the rest comes from how much we smoke or drink or exercise and the quality of the diet that we eat and things that are well outside the
meaning of our doctors. so i think that as much as what is going on with u.s. health care, quite a bit also needs to be addressed in terms of what is going on in the neighborhoods and communities. to really understand what is driving major changes across united states. >> okay? [inaudible conversations] >> here we go. i have actually two questions. one has to do with how@ one has to do with how i appreciate your data-driven information because it seems like we lack that so much today. when it is they there in black and white, it seems that people cannot dispute it at times. but i was with some friends today and i have mentioned that i was coming to this tonight. this one friend who is german
but married to a french man who spends a lot of time in france was railing about france and what france has been doing, how one in four workers, government workers and how people want their pensions to be paid, but france doesn't have the money to do it and accept it. i'm just curious what would you say to that and i have one question. >> sure. there's a lot of concerns about the european welfare state and mass obligation results in this huge part of paying pensions and so on. many blamed this for a class of detroit. the day i simply don't show that, to summarize that france hates pensions that are better than ours. but the cultural myth that is their is so strong that it's very hard to dispute and
similarly with the german increase episodes, a lot of people are blaming greek workers and that everyone is looking for the government, they are just getting the table. this is a very common survey that actually uses the same survey across european countries to sample how hard people work at some of our businesses. the greeks actually did quite a bit higher to the germans prior to the recession. so i think it's very difficult when we have cultural myths that are sort of perpetuating themselves. and the concern i understand is that the government has a degree of inefficiency the private markets can cure. that is based on the theory of advantage which has assumptions. there are assumptions that we have perfect competition and we
have capital that does not fly across the borders. all of which essentially are violated and basically part of our economy. i do math models for a living, but ricardo also says very clearly that this is a model and it can only apply in the assumptions are violated. >> my second question has to do with is there anyone in washington dc listening and inquiring and wanting to know more about what you are doing? >> the many people who work on this besides myself, i want to make it seem like the one nation, a lot of people are talking about who this is old hat, to be honest. and the difficulty is a lot of discussion about deficits and debt is really unintuitive. and this includes short-term deficits. it really makes it a lot easier
to say that we are in bad times and we should cut back, which is true for a household it's very hard to go through keynesian economic reasoning in a political speech. that being said, there are many folks who do on want a deed that driven approach to safety nets. and the vested interests that would like to have a genetic reduction that are very compelling. >> thank you. >> do you mind speaking in the microphone is a c-span person? sumac you give an example of ricardo's assumptions, or do you kind of list them? >> yes, they are buried in footnotes. but it's actually, if you are interested in these issues, there is an old report by the
group that was published in 2003. if you look at chapter two of that report, it was their major trade report. and they discuss in great detail what the data is regarding trade agreements in the assumptions upon which the trade should improve in which countries that is true and which it seems to be violated and how it has gone out the last two decades. so i would recommend not reading as much more detailed as part of a chapter there that is one of the best hackers i have seen in terms of laying it out and revisiting the original papers that this was based on. thank you. [applause] >> we have books at the counter
and our authors here and i am sure that he would be happy to sign them for you. thank you. >> would you like to see an author or book featured on booktv? send us an e-mail or tweet us at twitter.com/booktv. >> i'm very pleased to present this audience my new book. portraits of five remarkable lives. as he set about writing letters, it is more difficult to write a short one in a long one. in my book is short. it includes the sights and smells of the great terror from 1937 through 1938. through the eyes of five women caught up in extraordinary
circumstances. this includes the houston library and archives in the press without which this book could not have been written. and i would like to thank you individually and not to the book i have said this before, but it's a good way to introduce the topic. stone is purported to have said that the death of one person is a tragedy and the death of a million is a statistic. and those of us who study soviet russia fall into this trap. we think that we can convince people of stalin's evil by citing the millions who died in the hundreds of thousands shot
during the great terror of 37 and 38 in the millions of men and women and children who sat in his concentration camps and special settlements. stalin's many admirers in today's russia and even the last admit that stalin may have done some bad things. but if you look at it in its totality, maybe he is worth it. today stone is among the most admired figures in contemporary russia, which may be hard for us to believe. in my stories are transporting us from the statistic to the tragedy. they tell us that overwhelmingly these victims were ordinary people that were confused as to why they had been singled out. and they have done is between
perpetrator and victim unlike hitler's germany and the executioners became the executor. the wives and children of the repressed could contaminate others and they have to be isolated from society also. and each part of my work begins in stalin's office as he and his men finalize their decrees of repression and they then follow these decrees as they filter down to five families. in this presentation i leave stalin out and that is for you to read about when you buy the book. i want instead to introduce you
to four of my five women. you have to read the book to learn about the fifth. i women were not selected in any scientific fashion. but rather i read through hundreds and probably more than hundreds of unpublished memoirs primarily collected by this foundation until i found subjects who described in enough detail their lives during and after the goo lard. i did not want to write a story about one, but i wanted to get to know each family. ..