- The global wealth gap is expected to widen due to the coronavirus, with the poorest people more at risk of dying from Covid-19.
- The widening income gap may be more of a factor in social instability as the global economy appears to be facing a recession.
- A Brookings Institution fellow tells Karma that direct financial aid is the best way to combat the wealth gap in the U.S.; global institutions like the World Bank and IMF may have a tougher road.
The deadly coronavirus pandemic may widen the global wealth gap, with people in low-paying jobs at greater risk of losing employment and getting infected.
“It is likely going to get worse,” Martha Ross, a Brookings Institution fellow, said in an interview with Karma. “There are many workers — the cashiers, the taxi drivers, the food service workers — who earn low wages who don’t have health insurance or paid sick leave. They are seeing their wages evaporate before their eyes.”
People who lose their jobs won’t just be in worse economic shape — they may be at higher risk of dying from the coronavirus. That’s because poor people are about 10% percent more likely to have a chronic health condition, and early indications are that the coronavirus is 10 times as deadly for people with chronic conditions, according to the Chinese Centers for Disease Control and Prevention.
Taken together, that means Covid-19 may be twice as deadly for people on the low end of the wealth gap. And some people have raised concerns about the access to future coronavirus vaccines; Health and Human Services Secretary Alexander Azar has said the U.S can’t guarantee a vaccine would be affordable to everyone when it is available.
Because the disease is a global pandemic, a global economic response from financial bodies such as the World Bank and International Monetary Fund may be warranted. Ross says those types of organizations would likely move“way too slow for anybody’s satisfaction.”
Another complicating factor, according to the New York Times, is that income inequality tends to lead to higher prices overall, creating an increase in the cost of living that hurts low-income people the most. That forces more people on the low-end of the scale to live paycheck to paycheck, leaving them particularly vulnerable when a crisis like the coronavirus hits.
In fact, the “combined causal effects of health on poverty and poverty on health” can lead to whole communities being caught in a “disease-driven poverty trap,” according to a study in the British biological science journal Proceedings of the Royal Society B.
Ross said the best way to combat the inevitable economic impact of poverty on health in the U.S.is through direct financial aid, not tax breaks or other complex stimulus measures.
“The most efficient thing the federal government can do is to start mailing out checks to people,” she said. “Don’t try things like tweaking the tax code, it is not going to be enough money and it is not going to happen soon enough. When we are facing this kind of pandemic, people need money now.”
(Photo by Karen Ducey/Getty Images)