Economic Crisis, Restrictive Policies, and the Population’s Health and Health Care: The Greek Case

By Elias Kondilis, MD, PhD, Stathis Giannakopoulos, MD, PhD, Magda Gavana, MD, PhD, Ioanna Ierodiakonou, MD, PhD, Howard Waitzkin, MD, PhD, and Alexis Benos, MD, PhD
American Journal of Public Health, Published online April 18, 2013

The global economic crisis has affected the Greek economy with unprecedented severity, making Greece an important test of the relationship between socioeconomic determinants and a population’s well-being.

Suicide and homicide mortality rates among men increased by 22.7% and 27.6%, respectively, between 2007 and 2009, and mental disorders, substance abuse, and infectious disease morbidity showed deteriorating trends during 2010 and 2011. Utilization of public inpatient and primary care services rose by 6.2% and 21.9%, respectively, between 2010 and 2011, while the Ministry of Health’s total expenditures fell by 23.7% between 2009 and 2011.

What to Learn from the Greek Case

It is tragic that Greece has become an important test regarding the impact of economic and social determinants on a population’s health and well-being. Evidence presented indicates that economic recession and its consequences (unemployment, poverty and social exclusion, homelessness, and insecurity) exert important effects on Greece’s population health and health care services. Several causes of mortality and morbidity related to mental health, substance abuse, and infectious disease already show clear rising trends. Heightened needs and increased demand on public services collide with austerity and privatization policies.

http://ajph.aphapublications.org/doi/abs/10.2105/AJPH.2012.301126

And…

More Children in Greece Are Going Hungry

By Liz Alderman
The New York Times, April 17, 2013

Last year, an estimated 10 percent of Greek elementary- and middle-school students suffered from what public health professionals call “food insecurity,” meaning they faced hunger or the risk of it, said Dr. Athena Linos, a professor at the University of Athens Medical School.

(Principal Leonidas) Nikas has taken matters into his own hands and is organizing food drives at (his) school. He is angry at what he sees as broader neglect of Greece’s troubles by Europe.

“I’m not saying we should just wait for others to help us,” he said. “But unless the European Union acts like this school, where families help other families because we’re one big family, we’re done for.”

http://www.nytimes.com/2013/04/18/world/europe/more-children-in-greece-s…

And…

Child Well-Being in Rich Countries

UNICEF, April 2013

Rank of child well-being in 29 nations of the industrialized world

25th – Greece
26th – United States

http://www.unicef-irc.org/Report-Card-11/

And…

Growth in a Time of Debt

By Carmen M. Reinhart, Kenneth S. Rogoff
National Bureau of Economic Research (NBER), January 2010

Our main findings are: First, the relationship between government debt and real GDP growth is weak for debt/GDP ratios below a threshold of 90 percent of GDP. Above 90 percent, median growth rates fall by one percent, and average growth falls considerably more.

http://www.nber.org/papers/w15639

And…

Does High Public Debt Consistently Stifle Economic Growth? A Critique of Reinhart and Rogoff

By Thomas Herndon, Michael Ash, Robert Pollin
Political Economy Research Institute, University of Massachusetts Amherst, April 15, 2013

Herndon, Ash and Pollin replicate Reinhart and Rogoff and find that coding errors, selective exclusion of available data, and unconventional weighting of summary statistics lead to serious errors that inaccurately represent the relationship between public debt and GDP growth among 20 advanced economies in the post-war period. They find that when properly calculated, the average real GDP growth rate for countries carrying a public-debt-to-GDP ratio of over 90 percent is actually 2.2 percent, not -0:1 percent as published in Reinhart and Rogo ff. That is, contrary to RR, average GDP growth at public debt/GDP ratios over 90 percent is not dramatically different than when debt/GDP ratios are lower.

Overall, the evidence we review contradicts Reinhart and Rogoff ‘s claim to have identified an important stylized fact, that public debt loads greater than 90 percent of GDP consistently reduce GDP growth.

http://www.peri.umass.edu/236/hash/31e2ff374b6377b2ddec04deaa6388b1/publ…

Greece’s austerity program, accompanied with privatization of public health services, is having tragic consequences, reflected in the health of the people. Not only is health care impaired, the children are going hungry! It is particularly tragic when you consider that there are solutions to their economic crisis, other than austerity, that would keep their children fed and in good health.

The world-wide austerity movement received a big boost with the publication three years ago of the paper by Carmen Reinhart and Kenneth Rogoff supposedly showing that public debt to GDP ratios over 90 percent resulted in considerable declines in the growth rate of the economy. The “austerians” were off and running. Paul Ryan even included the concept in the budget passed this year by the Republican-controlled House of Representatives.

The problem with the Reinhart/Rogoff thesis is that it is flat-out wrong. The paper by Thomas Herndon and his colleagues proved to be a bombshell that refuted the R/R doctrine and demonstrated that “average GDP growth at public debt/GDP ratios over 90 percent is not dramatically different than when debt/GDP ratios are lower.” Economists and policy makers are in a frenzy, and let’s hope that it results in a conclusion that transitional resolutions to economic crises require the use of debt to prevent austerity measures that negatively impact the most basic of needs for the people.

So when we look at the UNICEF rankings of child well-being in industrialized nations, we are saddened by the fact that Greece ranks 25th amongst 29 nations. If the European Union had a little heart, they would be helping their sister country pull out of the crisis without extracting a requirement that Greece raises its misery index.

(Excuse the deliberate deception, but it is to make a point. The misery index is a combination of high unemployment and high rates of inflation. Yet inflation is very low, but the austerians are convinced that it should be high even if it isn’t, and so they are acting accordingly – more austerity!)

At least in the United States we are smart enough to not let our budget deficits shift us into an austerity mode. Or are we? President Obama is now negotiating with Republicans to cut back on two of our most successful social programs – Social Security and Medicare, as part of an austerity program.

Where do we stand now? The UNICEF ranking of child well-being has placed the United States in the 26th position, below Greece! More austerity is the very last thing we need!

For those who have been feeling so smug as we look at Greece’s tragic circumstance, think again! Then fire the austerians! It’s a matter of social justice.