It is well documented that sustained unemployment imposes significant economic, personal and social costs that include:<\/p>\n
- \n
- loss of current output; <\/li>\n
- social exclusion and the loss of freedom;<\/li>\n
- skill loss;<\/li>\n
- psychological harm;<\/li>\n
- ill health and reduced life expectancy;<\/li>\n
- loss of motivation;<\/li>\n
- the undermining of human relations and family life;<\/li>\n
- racial and gender inequality; and<\/li>\n
- loss of social values and responsibility.<\/li>\n<\/ul>\n
The Groupthink that devalues these costs and imposes harsh sanctions on the unemployed individuals and families who have to bear, disproportionately, the costs, is oblivious to the further consequences that arise from the losses.<\/p>\n
I see the sort of terrorism we are worried about these days as fitting squarely within that frame. I consider one form of deliberate and well-organised state terrorism (fiscal austerity, deregulation etc) leads to a more random form of terrorism (for example, idiots who chant religious slogans and kill coppers in cold blood as they lie on a footpath and plead for their lives).<\/p>\n
There was an interesting article in the Fairfax press today (January 9, 2015) – Recession hurts Japan’s fight to change suicide culture<\/a> – which touches on some of these ideas.<\/p>\n
It argues that:<\/p>\n
\nJapan’s recent slide into recession wasn’t just a blow to Abenomics. For some in the G-7 nation with the highest suicide rate, it may pose a question of life and death.\n<\/p><\/blockquote>\n
As Japan has gone back into recession the suicide rate has risen again in Japan. The data shows a tight “between economic developments and suicide”.<\/p>\n
The “optimism generated” by the early days of Abenomics “helped bring the number down” after the troubles of the 1990s had seen it rise sharply.<\/p>\n
The article notes that Japan has a particularly cultural inclination to use suicide as a solution to personal issues.<\/p>\n
However, the long-standing tradition of “harikari” aside, the link between suicide and economic performance (particularly unemployment) is a global phenomenon.<\/p>\n
This article from the British Medical Journal (Published September 17, 2013) – Impact of 2008 global economic crisis on suicide: time trend study in 54 countries<\/a> – is representative.<\/p>\n
The Authors concluded that:<\/p>\n
\nAfter the 2008 economic crisis, rates of suicide increased in the European and American countries studied, particularly in men and in countries with higher levels of job loss.\n<\/p><\/blockquote>\n
Last year, a comprehensive paper was published (April 2014) – The Impact of Fiscal Austerity on Suicide: On the Empirics of a Modern Greek Tragedy<\/a> – which concentrated on the role of fiscal austerity and suicide in Greece.<\/p>\n
It found that “Greece has historically had one of the lowest suicide rates in the world” but “in the aftermath of the 2008 financial crisis it has increased markedly”.<\/p>\n
They also found that “Suicide rates in Greece and other European countries have been on a remarkable upward trend following the global recession of 2008”.<\/p>\n
Their overall finding was that:<\/p>\n
\n… fiscal austerity, higher unemployment rates, negative economic growth and reduced fertility rates lead to significant increases on overall suicide rates in Greece, while increased alcohol consumption and divorce rates do no exert any significant influence on overall suicide rates.\n<\/p><\/blockquote>\n
So the Groupthink that leads to governments around the world deliberately creating and perpetuating unemployment kills people even if indirectly. There are no ‘national manhunts’ for the policy makers and technocrats who are responsible for this form of terrorism. Instead, they all seem to be rewarded with high salaries and generous superannuation pensions.<\/p>\n
Here is some evidence from Japan. The data is from the World Health Organisation (suicide rates) and the Japanese Cabinet Office (Real GDP growth). The suicide rate per 100,000 is available at 5-yearly intervals and goes back to 1950.<\/p>\n
The first graph shows the suicide rate from 1950 to 2010 (blue) and the black straight line is a simple linear regression which excludes the first three observations (1950, 1955, and 1960) and shows the trend since 1060.<\/p>\n
The first three observations were in a period of Post-War chaos and shame and appear to be outliers.<\/p>\n
The point of the graph is that there has been a rising trend in the period after reconstruction and during the transition from strong growth to crisis (early 1990s) and then slower growth.<\/p>\n
![\"Japan_Suicide_Rates_1950_2010\"](\"https:\/\/billmitchell.org\/blog\/wp-content\/uploads\/2015\/01\/Japan_Suicide_Rates_1950_2010.jpg\")
<\/a><\/p>\n<\/div>\nI constructed 5-year annual average real GDP growth rates in the previous five years of each suicide rate observation. The idea is that the last five years of economic outcomes conditions the mood of the day. It is just a rough measure.<\/p>\n
The next graph has these real GDP growth rates on the horizontal axis and the suicide rates on the vertical axis. The black line is the linear regression trend between the two variables.<\/p>\n
The red markers exclude the three observations for suicide rates (1950, 1955 and 1960) and the two trend lines correspond with the two samples.<\/p>\n
Irrespective of whether I include or exclude the earlier suicide outliers, the relationship between economic activity (horizontal axis) and the suicide rates (vertical axis) is significantly inverse – higher real GDP growth rates are associated with lower suicide rates.<\/p>\n
If I had more finely grained data (the constraint being the suicide rates) and used more sophisticated statistical techniques I would still find a strong inverse relationship between economic activity and the suicide rates.<\/p>\n
![\"Japan_Real_GDP_growth_Suicide_Rates_1950_2010\"](\"https:\/\/billmitchell.org\/blog\/wp-content\/uploads\/2015\/01\/Japan_Real_GDP_growth_Suicide_Rates_1950_2010.jpg\")
<\/a><\/p>\n