It's not just the less well-off who should feel aggrieved by fat cat salaries. One way or another, it's costing all of us

If you’ve never seen US comedian Lewis Black’s riff about greed you should have a look. So too should Paul Reynolds, and a few other chief executives employed by our major companies.

While it’s tempting to beat up on the Paul Reynolds of the world, we can leave talkback land to do that. But having enjoyed Black’s humour, progressives (and even those corporate fat cats) should then turn to a recent book which is creating the odd wave in social democratic circles overseas. It’s called The Spirit Level and is by two British academics, Richard Wilkinson and Kate Pickett. Its findings – and the research is rigorous – makes for compelling reading.

According to Wilkinson and Pickett, unequal societies with large wealth disparities are bad, not just for the impact poverty has on the poor, but for the well-off as well.

The Guardian has an informative review summarising some of the key findings. The US is wealthier and spends more on health care than any other country, yet a baby born in Greece, where average income levels are about half that of the US, has a lower risk of infant mortality and longer life expectancy than an American baby. Obesity is twice as common in the UK as the more equal societies of Sweden and Norway, and six times more common in the US than in Japan. Teenage birth rates are six times higher in the UK than in more equal societies; mental illness is three times as common in the US as in Japan; murder rates are three times higher in more unequal countries.

New Zealand gets a few citings in the book, which are well deserved. Of the countries surveyed, we enjoy one of the lowest levels of average income, but we enjoy one of the largest income gaps. Not surprisingly, we also boast high incarceration rates, high levels of mental illness, a high level of teenage births. Where we don’t too badly – in high average literacy levels, for example – there’s a twist. Our average score might be high, but we show a high degree of social inequality in literacy. Moreover, researchers suggest one of the reasons for our good score for average literacy might have more to do with the fact that we have a higher proportion of kids who should sit the tests but don’t because they have dropped out, or are truants.

According to Wilkinson and Pickett:

“Across whole populations, rates of mental illness are five times higher in the most unequal compared to the least unequal societies. Similarly, in most unequal societies people are five times as likely to be imprisoned, six times as likely to be clinically obese, and murder rates may be many times higher. The reason why these differences are so big is, quite simply, because the effects of inequality are not confined just to the least well-off: instead they affect the vast majority of the population.”

So what does all this mean? It gives some grunty data to start progressive politicians to thinking about serious measures to reverse inequality. Until the end of the Keynesian consensus, societies were, relative to today, rather equal. And we don’t need nostalgia to remind us that New Zealand in the 1970s was a rather kinder, cleaner, less violent, safer place than it is now.

Yes, the 1980s brought in some nice changes. We can shop on weekends. We can drink wine from bottles. We can eat exotic foods. But do we really need a society with such marked disparities of income? Surely it’s not beyond us to rein in corporate excess while keeping some of the accouterments of modern society? Does Paul Reynolds really need every cent of the $5 million he received?