The Real Costs of the Financial Crisis -- Suicide and Heart Attacks

Last Updated Sep 21, 2011 12:37 PM EDT

It's easy to get hung up on numbers in assessing the carnage caused by the financial crisis. Jobs lost in the U.S. during the recession (8.7 million). Estimated economic growth in the eurozone next year (roughly 1 percent). Amount borrowed by banks from the Federal Reserve in 2008 ($1.2 trillion). But there are more painful costs, as the WSJ notes in considering the human toll of the meltdown in Greece:
Recorded suicides have roughly doubled since before the crisis to about six per 100,000 residents annually, according to the Greek health ministry and a charitable organization called Klimaka.
About 40 percent more Greeks killed themselves in the first five months of this year than in the same period last year, the health ministry says.
The victims are mostly men age 35 to 60 facing financial hardship, such as the fruit and vegetable grocer cited in the story. That departs from the usual profile for suicides in Greece -- typically adolescent males and old, sick people -- suggesting that economic distress, rather than other factors, is what is driving people to kill themselves.

The pattern also squares with what is happening more widely across Europe, where suicides have surged since the crash, according to British medical journal The Lancet. That is perhaps no surprise. Research shows that job loss and financial insecurity are associated with a higher incidence of depression and other forms of mental illness. Concludes a team of psychiatrists from Canada's University of Manitoba:
Low levels of household income are associated with several lifetime mental disorders and suicide attempts, and a reduction in household income is associated with increased risk for incident mental disorders.
Rise in child abuse
The global financial crisis and its aftermath has of course had a devastating impact around the world. Millions of people have been pushed into poverty, while commodities speculation by large financial institutions has caused starvation by driving up food prices. But the prolonged periods of unemployment, rampant foreclosure and other hallmarks of the crisis also appear to be having other social effects.

For one, an increase in child abuse. Between 2004 and 2009, the number of kids ages 5 and under from low-income families who were treated for violence-related head injuries rose 65 percent, researchers at the University of Pittsburgh recently found. This doesn't establish a direct connection between the upsurge in abuse among poor families and, say, Wall Street's appetite for dodgy loans during the crisis. But it doesn't exactly require a Ph.D to posit a link. As one expert told U.S. News & World Report:
"Stress and poverty are risk factors for child abuse," Peter Sherman, a pediatrician and director of the residency program in social pediatrics at Montefiore Medical Center in New York City, told HealthDay. "If people are stressed out, it's not a big stretch that they are at high risk for being abusive."
Squeezing cancer patients
Another unpleasant side-effect of unemployment: death. Sociologists have determined that workers who are laid off tend to have a higher mortality rate than those who keep their jobs. That trend can persist for up to 20 years after a person gets shown the door, slicing an average of 1-1.5 years off their life expectancy. In the short term, layoffs are also associated with higher risk of heart attacks and other stress-related illnesses, according to the IMF.

Economic austerity isn't helping. In the U.S., financially strapped states around the nation are cutting financial aid to impoverished families. One result of such cutbacks -- more than one-fifth of American children now live in poverty, the highest level in decades. In Greece, to cite a more concrete example of the impact of recession, Swiss pharmaceutical giant Roche has stopped providing cancer and other drugs to some government-funded hospitals that are behind on their bills. It may do the same elsewhere in Europe, the company's CEO told the WSJ. The result:
Patients at some hospitals now must take their prescriptions to a local pharmacy, and, in the case of intravenous or injected cancer drugs, bring them back to the hospital to be administered, he said.
Sickening in more ways than one.

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  • Alain Sherter On Twitter»

    Alain Sherter is an award-winning business journalist who has written for The Deal, MarketWatch and Thomson Financial Media.

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