This article is so good it makes me want to read the Financial Times, and that's saying something. You should read the whole thing, but here's an extract.
The British election campaign of spring last year, by contrast, was characterised by a relentless statistical crossfire. Ed Balls declared that a couple with children had lost £1,800 thanks to the government’s increase in value added tax. David Cameron countered that 94 per cent of working households were better off thanks to recent tax changes, while Nick Clegg was proud to say that 27 million people were £825 better off in terms of the income tax they paid.
Could any of this be true? Yes — all three claims were. But Ed Balls had reached his figure by summing up extra VAT payments over several years... If you offer to hire someone for £100,000, and then later admit you meant £25,000 a year for a four-year contract, you haven’t really lied — but neither have you really told the truth. Clegg boasted about income-tax cuts but ignored the larger rise in VAT. And Cameron asked to be evaluated only on his pre-election giveaway budget rather than the tax rises he had introduced earlier in the parliament — the equivalent of punching someone on the nose, then giving them a bunch of flowers and pointing out that, in floral terms, they were ahead on the deal.
Another source of confusion: if wages for the low-paid and the high-paid are rising but wages in the middle are sagging, then the median wage can fall, even though the median wage increase is healthy. The UK labour market has long been prone to this kind of “job polarisation”, where demand for jobs is strongest for the highest and lowest-paid in the economy. Job polarisation means that the median pay rise can be sizeable even if median pay has not risen.
Confused? Good. The world is a complicated place; it defies description by sound bite statistics. No single number could ever answer Ronald Reagan’s question — “Are you better off now than you were four years ago?” — for everyone in a country.
http://www.ft.com/cms/s/2/2e43b3e8-01c7-11e6-ac98-3c15a1aa2e62.html?siteedition=uk
I nearly cheered at "Confused? Good. The world is a complicated place; it defies description by sound bite statistics." I'd been thinking that it's not statistics that lie, as the phrase goes, but people's discomfort with complexity.
ReplyDeleteMichael J. Coffey Your verbage ("sound bites") and the pic of snake-tongued heads, made me chuckle. #twoferone!!!
ReplyDeleteThat's all from the original article and not my doing, Mark Ruhland. I'm afraid I can't take credit for that...unless maybe if I use statistical bullshit...
ReplyDeleteMichael J. Coffey
ReplyDeleteYeah, I gave you credit, because you brought the concept to my attention. Even though it was an artist and writer of the article that should get the credit. I just thought it was a fun way to illustrate the point. Very creative on their part.
I love how they've gone for a technical definition of 'bullshit'.
ReplyDeleteTim Harford is great. I often listen to him on More or Less, on Radio 4. Always interesting.
ReplyDeleteFT actually is quite good by several objective measures, though it does tend to favour a capitalist / marketist / financialist philosophy. This doesn't make it unuseful. And at times it's exceptionally intelligent.
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