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The Third Way: Can a healthy economy be an economy for health?

By Brian Mackenzie - posted Thursday, 24 February 2005

The fundamental organising principle of most western democracies - the principle against which all others are tested - is the maintenance of a healthy economy. A healthy economy, in this model, is focused on fostering economic growth.

The current orthodoxy is that, if it’s good for business, it’s good for all of us. We all benefit from the ability of businesses to trade freely, to compete with one another without hindrance, and to make and invest profits. This ability makes them more efficient, and enables them to produce goods and services more cheaply.

One of the dominant political discourses in western democracies concerns the role of government within the economy. The old ideological disjunction of left and right is said to have disappeared. The liberal commitment to individual freedom in market economy, and the social democratic commitment to social justice through the action of government, are being combined.


The clearest political articulation of this has occurred within the UK - and in particular in the speeches of Prime Minister Blair - but the academic discussion has occurred both in the UK and the US. Blair's articulation is clearly the most influential, because it has shaped UK policy.

One of the givens is the inevitability - and the desirability - of global competition, and the need to free up international trade, with individual nation states being bound by a common set of minimally-prescriptive rules. Governments are not free to interfere for fear of being punished by the markets.

The principal objective of the global trading system is to promote economic efficiency and economic growth. National social objectives are acceptable, but only in so far as they do not impede the drive for economic growth and efficiency, or interfere with the rules of trade.

The goal is a level field on which to play the game of international commerce in accordance with the rules of the market place.

So we might characterise the parameters of a healthy economy thus:

  • Its purpose is to allow wealth creation, where wealth creation is defined as “the production of ‘valuable’ objects or services for intended customers”;
  • It is competitive - and the nature of competition means that there must be winners and losers;
  • It has a minimum level of regulation - just enough to ensure that there is a level playing field; that everyone plays by the same rules;
  • It is global in orientation, and encourages unrestricted trade between nation states, and between trans-national enterprises;
  • It celebrates wealth creation and the acquisition of wealth;
  • It values and rewards individual risk-taking in the pursuit of wealth creation and acquisition;
  • It requires inequality. For example, the efficient operation of the employment market requires that there is a pool of unemployed;
  • The stabilising levers are fiscal and monetary policy - interest rates, money supply and so on; and,
  • It is oriented towards achieving growth in the economy at the nation state or global level.

What we know about health

Health is created by caring for oneself and others, by being able to take decisions and have control over one’s life circumstances, and by ensuring that the society one lives in creates conditions that allow the attainment of health by all its members. (WHO Ottawa Charter for Health Promotion).

Ron Labonté, a Canadian professor of public health, asked people to talk about their experience of health, and from that he articulated six “fields” of positive health, or well-being: feeling vital and full of energy; having good social relationships; experiencing a sense of control over one’s life and one’s living conditions; being able to do things one enjoys; having a sense of purpose in life; and experiencing a connectedness to “community”.

We know that life expectancy in different countries is dramatically improved where income differences are smaller and societies are more socially cohesive. The evidence suggests that what matters within societies is not so much the direct health effects of absolute material living standards so much as the effects of social relativities. In the developed world, it is not the richest countries which have the best health, but the most egalitarian. An important characteristic they all seem to share is their social cohesion - they have a strong community life, and the individualism and the values of the market are restrained by a social morality. The quality of the social life of a society is one of the most powerful determinants of its health. This in turn is very closely related to the degree of income inequality that exists in the society.

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About the Author

Brian MacKenzie is Director of Special Projects at Tai Poutini Polytechnic, Greymouth, NZ.

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