Here in the U.S., we now have an advisory board headed by the richest man in the world, Elon Musk, along with Vivek Ramaswamy, who is definitely not poor. Referring to themselves as the Department of Government Efficiency, this duo is promising to cut $2 trillion dollars from the federal budget. However preposterous in scale, this promise sets the stage for draconian cuts in federal spending on education and health. As Senator Elizabeth Warren observes, however, definitions of efficiency vary.

Proponents of austerity (shorthand for cuts in public social spending) pose as disciplined rational actors seeking to reduce waste. They assume that such spending represents misplaced efforts to do good, performative gestures to alleviate the guilt of the tender-hearted. Whining about poverty and inequality is so…unproductive.

In truth, efficiency is not about the triumph of practical over idealistic concerns. It’s about minimizing the cost of necessary “inputs” into valuable “outputs,” and both of these “puts” must be clearly defined and measured. Conventional economic models treat human labor as an input into an output measured in dollars, Gross Domestic Product or GDP (the final value of all goods and services sold in a country). GDP is not only the source of profit; it is also most common  indicator of economic growth and success.

But GDP is not just an output. It is also one of many inputs into the output that we value the most—our capabilities for life, love, work, and the pursuit of happiness. Our “reproduction” is just as important as our “production.” So, we might ask, how efficient are we at taking care of ourselves and others?  

This question is hard to answer, since our national accounts largely ignore inputs that don’t have a market price, such as unpaid work and ecological resources, and don’t consider health, happiness, or children components of GDP. Our economic system does little to reward allocation of time, money or effort to non-market activities such as caring for our existing population and raising the next generation. Prevailing concepts of efficiency are predicated on the idea that we can define national success in the same terms that Musk and Ramaswamy use to assess the rate of return on their private investments.

Lest this complaint sound too abstract, consider one particularly quantifiable measure of the success of the U.S. “care economy”: life expectancy. Research has long shown that the U.S. ranks extremely low on this measure relative to other affluent countries despite spending far more overall on health care. This conspicuous inefficiency is dramatized by a profit-oriented private health insurance industry so disliked that the recent murder of one of its corporate executives elicited some morbid celebration.

Increased inequality, downward mobility, and economic stress in the U.S. have contributed to heightened levels of death from drug abuse, alcoholism, and suicide. These problems are often treated as social problems outside the scope of economic policy, getting far less attention from the media than increases in the price of cryptocurrencies and tech stocks.

Yet significant and growing differences in life expectancy across states within the U.S. clearly show the negative impact of conservative state policies across a wide spectrum that includes restricting access to Medicaid, resisting gun control measures, and discouraging higher minimum wages. Journalist William Kleinknecht provides a detailed account in his 2023 book, States of Neglect. So-called Red states under Republican control have higher mortality rates than Blue States under Democratic control, and these differences have increased substantially over time.

In an article aptly titled “The Life-and-Death Cost of Conservative Power,” sociologist Paul Starr describes this outcome as the result of an implicit social experiment that began in the 1980s, asking “What would be the effect on American’s well-being if we turned over a wider array of policies controlled by political parties with opposed agendas?” The result: people in Red states suffered.

Journalist Kalena Thomhave adds a specific example. In 1959, residents of  Oklahoma (Red) and Connecticut (Blue) had roughly the same life expectancy at birth. By 2019, those in Connecticut were likely to live 4.7 years longer.

These journalistic accounts are based on a more technical statistical analysis that also estimates that women in the U.S. would live almost 3 years, and men slightly more than 2 years longer if all states rejected the conservative model.

Translating this into more economic terms, how much would you be willing to pay for an additional year of life? Keep in mind that willingness to pay is not the same as ability to pay, and selling your soul, while profitable in the short run, is quite inefficient in the end.

This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License. Photo courtesy of BOHOCOMMUNITY.ORG