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February 03, 2004

Obvious Errors

Although I believe Stephen Moore often makes good points about economic growth, his latest column on growth in government spending contains such a ridiculously obvious, fundamental error, he demolishes his own point.

For all his long-winding examples of how much more we spend on government today, he fails to note population growth trends. But here's a chart that shows US population growth from 1790-2000. We recently cracked 300 million people, folks. Of course government spending's going to go up when we grow so quickly--we've more than doubled the population since 1940.

I also notice another problem in Moore's figures. He notes that the 68,000 pages in the Federal Register (the listing of all government regulations) have increased 17-fold in sixty-five years. He fails to mention that in 1980, we had well over 90,000 pages in the Federal Register, and have slashed lots of regulations since that time.

There's an old, very wrong, statement: "There are lies, damned lies, and statistics." No, actually, statistics very rarely lie at all. They are, after all, simply a matter of math.

But lousy statistics can give you the wrong impressions. Which is why, whenever confronted with statistics, you should ask for sources, and you should ask big questions about underlying data. Whether anything important has been left out usually being the first thing you should ask.

Funny thing is? There's no reason most people couldn't learn this stuff in High School. Too bad most of them don't.

(Via Presto Pundit.)

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Of course government spending's going to go up when we grow so quickly--we've more than doubled the population since 1940.

How fast has government spending grown since 1940?

Posted by McGehee on February 03, 2004 at 7:09 AM


I do not know, and Moore does not tell us. I would expect it to have gone up substantially since 1940 since Roosevelt's Social Security system and such would have come into play, which is about a third of our government's budget and would not, I believe, have appeared in the 1940 budget. So there would be a 1/3rd expansion right there. But that would not indicate a "creeping increase in government expenditure" so much as the single largest entitlement program in the nation's history, and hardly what most people think of when they think "pork and waste." (There's no reason not to reform it of course, but let's at least acknowledge the basic facts up front.)

Moore does tell us we spend more on social programs than we fought to fight World War II. And, so, what does that mean? What are his sources? What the heck is he talking about exactly? What if I said, "Social Security costs more than it did to fight World War II?" Now, is that a case of "creeping government expansion," or is it...?

You can't just go throwing out half-assed statistics and not at least give your sources, and address obvious wholes like these. Moore may be a nice guy but I have no idea what I'm supposed to think of this random collection of half-facts he's presented us with here.

And I know he's capable of better because I've seen better from him.

Posted by Dean Esmay on February 03, 2004 at 7:24 AM


Ahh, but dean you miss the beauty in Twain's statement re: statistics. A lie is a lie, and a damned lie is a damned lie, but a statistic appears to be truth, because it's just math, as the statisticians will tell you.

People can take good statistics and make lies using them as grounds for their claims. Or they can make lousy statistics. Or they can jimmy the charts to make the statistics look more significant than they are.

The truth behind the assertion isn't that lousy statistics can give you a wrong impression, but that statistics can be used so effectively to deliberately distort your impression.

In that way, they can be worse than a lie.

As for Moore's piece, I'm particularly fond of his apportionment of tax spending as a $50,000 grant to all families of four. The logical question: how many such families are there, and why only them and not the singles and families of more or less than four?

Posted by bryan on February 03, 2004 at 9:05 AM


The fundamental problem I have with your view, Bryan, is that you could just as easily say, "You can say anything with words" as "you can say anything you want with math." Semantically, there is no difference.

Statistics are, scientifically, one of the very most powerful tools, and greatest inventions, in all of human history. They have been a source of powerful good for humanity, and without them, we would still be very much in the dark ages in many ways, both technologically and socially.

When someone says to me that "those are just statistics," I have to restrain myself from impatience. Because, again, it's like saying, "those are just words." It's almost always a code-phrase for:

1) I don't want to know the truth, or
2) I'm not very bright.

#2 I find disappointing. #1 I find to be one of the worst of all human sins.

I can teach your average bright 13 year old all he needs to understand basic statistical methodology in one day--mean and median, easily enough, modal if we both have a little patience, mostly using common arithmetic. Then, with a little committment to scientific principles--first and foremost, a committment to finding the truth rather than reaching the desired conclusion, you can sort those who lie with statistics from those who tell the truth (or have simply made an honest error).

Of course there are far more advanced statistical methodologies, but for almost any intelligent adult with an interest in the truth, most statistics can easily be checked and verified for basic veracity.

If you had said there are lies, damned lies, and statistical lies, meaning to imply that to lie with statistics is particularly egregious, I suppose I could sort of understand that. But most statistics are not lies, and statistical methodology is one of the crowning achievements of mankind. To denigrate them in such a fashion is utterly inappropriate.

Posted by Dean Esmay on February 03, 2004 at 10:25 AM


Another old saying: "Figures don't lie, but liars sure do figure."



If you had said there are lies, damned lies, and statistical lies...

I think that's what most of us (including Twain) mean(t), Dean. Along with the (seeming) fact that just about any time someone says 'Statistics prove this!', it's an attempt to lie by twisting statistics. We just don't say it quite that explicitly.

Posted by Dave on February 03, 2004 at 11:25 AM


Dean,
We used to have civics classes in high school, that taught students about how the govt worked, how bills go through congress, about the balance of powers, about the basic laws of our society.

But they didn't have them by the time I got in high school back in the 80s. We had a "government" class, and learned some things about the Constitution, but much of the 'civics' portion of it, including budgets and so forth, was largely absent.

I've seen some people blame the removal of civics classes from schools on Democrats and the NEA teacher's union, but I can't find much about it through Google. But what I did find seems to indicate that the remaining places that do have civics classes seem to use them as liberal indoctrination opportunities.

The other problems seems to be that our news media doesn't really care about presenting facts in a useful manner any more, either. I say this because I've seen news outlet after news outlet talking about the huge size of the deficit projections under Bush's latest budget and tax cuts, that we have the largest defecit ever...but few words that it is the largest dollar amount, but not the highest when expressed as a percentage of revenues, which is relevant, I think. And nary a word that our revenues grow enough each year that merely instituting a spending freeze for only a mere three years would result in the largest surplus in our entire history, both as a pure dollar amount and as a percentage of revenues. Nary a word that the difference between a hot economy, a mediocre economy, or a recession can actually make deficit or surplus projections shift exceedingly rapidly, making any projection farther out than 2 years no more than pixie dust.

You'd think that news media should do more than just sensationalize, even if they've given up restricting themselves to just reporting; the "investigative" side of our news media has apparently been lost, as well, in the drive for ratings.

I've said it before: A free news media is vital to the well-being and freedom of a nation. Unfortunately, our news media has been bought and paid for...

Posted by nathan on February 03, 2004 at 11:45 AM


Moore says spending has doubled since 1960...
According to Dean, pop. has doubled since 1940.

This still means spending is going up 50% faster than population, on average. Assuming both facts are correct, I'd say that actually supports Moore's point, right?

Posted by patrick on February 03, 2004 at 12:13 PM


There is another saying by, I believe, Charles Murray. "It is easy to lie with statistics but it is much easier to lie without them".

Posted by Emory on February 03, 2004 at 1:06 PM


Stats don't lie. It's the interpretation of the data that is most often manipulated. For example, the USA Today headline today was "Kerry leading Bush in new poll." This is another example of the media treating polls as hard news but that's another essay.

The text read, "Kerry defeated Bush 53% to 46%, a lead outside the poll's margin of error. North Carolina Sen. John Edwards edged Bush at 49%-48%, a statistical tie. Bush bested former Vermont governor Howard Dean by 7 points and retired Army general Wesley Clark by 3."

Yet in the small print at the very bottom, "Results are based on telephone interviews with 1,001 National Adults, aged 18+, conducted January 29-February 1, 2004."

So what people assume is 53% of Americans would support John Kerry and only 46% George W. Bush. What the poll results prove is that 530 Americans would support Kerry today in race vs Bush and 460 Americans would support the president. But "53%" makes better copy and headline material than "530 people." All that this poll proves is that Kerry is more popular among the 1001 specific Americans chosen for this particular poll.

As someone with a math degree and a concentration in statistics, I know all about scientific sampling and all that. But it doesn't change the fundamental fact that people extrapolate too much out of polls. Polls are like a Big Mac. They spice things up from time to time but unhealthy if consumed in large quantities.

Posted by Brian on February 03, 2004 at 1:47 PM


Okay, yes , you are probably correct that spending has gone up faster than the population--just not as wildly and insanely as Moore seems to be implying.

Now, consider: Around 1940 or so, we got Social Security, which has grown so large that it's now an entire third of the annual budget--which it did not used to be, but people live a lot longer and collect more now.

In the early 1960s, we got Medicare, Medicaide, and several other large social programs. Now, perhaps you want to get rid of those--good luck with that whole political suicide thing--but the fact is that the spending increases appear to be mostly, mostly made up of a small handful of large programs, and not a devouring, all-consuming monster.

Furthemore, consider: except for a brief blip in the 1970s, when a combination of stagflation and a huge surge of new workers entering the workforce temporarily repressed wages (women entering the workforce by the tens of millions), the economy has done very little but expand, and real incomes have done nothing but go up for the last 60 years. Tiny little drops in real income now and then have happened, but the overall trend has been very clear:

The middle class has done nothing but expand, average wages (real wages, adjusted for inflation) have done nothing but expand, the poor have gotten richer, the middle class has gotten richer, and the rich have gone richer--all of them have gotten fairly steadily richer.

Today we have longer lifespans, greater access to health care, more disposable income, spend less time at work and more at leisure, than we ever have before.

Every one of these is indisputably true.

So why should we be surprised if, as a nation, our population, lifespans, and incomes have all gone up, that the government won't be collecting more money?

It may well be that Moore's overall thesis--that government is bigger than it needs to be--has some validity. But there is no crisis here.

The big question: how much bigger, as a percentage of our population, and as a percentage of GDP, is government really? We should start with answers to those questions before we start determining how deeply we need to reign it back.

Posted by Dean Esmay on February 03, 2004 at 4:53 PM


Dean,

The problem with statistics is not that they're usually false, but rather that they're usually meaningless. It's not that the people have misapplied the mathematics behind statistics, it's that they:

(1) Don't tell you the sources of error
(2) Never present the statistics in totem, they always summarize

As Den Beste recently said, in most polls, it's reasonably safe to assume that they're accurate to +/- 20%, though many are worse than that. Anyhow, people always then go and summarize the polls, typically with inaccurate summaries that are mildly better than outright lies.

It's not that statistics as a field of mathematics is a form of lying. It's that most of the times you hear a statistic, it's a lie. It's kind of like that old joke about how can you tell if a lawyer is lying? his lips are moving.

It's not that there's anything wrong with statistics per se, it's that they have such a high correlation with deceit.

Posted by ctl on February 03, 2004 at 5:08 PM


I'll butt in here with a side comment on statistics. In my opinion, statistics are always lies. The central lie being, of course, that a complex, dynamic anything (such as a collection of millions of quadrillions of individual particles or millions of individually unpredictable, idiosyncratic humans) can be summed up "adequately" with a single number or a small collection of numbers. Obviously, they cannot. So the statistic is a lie, whether it's "temperature", or "average height", or "median income" or what-have-you. But sometimes lies can be useful and meaningful, as long as you don't push them too far. For example, gasses don't have "temperatures", they are collections of umpteen kajillion molecules that each have individual, constantly changing characteristics. As it happens, the dynamics of gasses tend to make a measurement of the average kinetic energy of molecules in the gas a useful metric for certain properties of the gas. But, again, the temperature is not a property of the gas, it is a statistic, a lie, a cheap and dirty approximation of the average behavior of molecules in the gas. A physicist ignores the truth of temperature at their peril. And, in fact, there is quite a substantial body of physics which deals with the quirky ways in which the simple statistic temperature does not adequately sum-up what's going on heat and kinetic energy wise in the gas. Now imagine how wrong you can get when trying to describe humans and human behavior with statistics. It is wise always to remember that statistics are only crude approximations to the truth (aka lies) and only useful when not stretched beyond the assumptions that went into them.

Posted by Robin Goodfellow on February 03, 2004 at 11:00 PM


Dean,

I see your point. I disagree, but I don't have time to go into it right now. Statistics are a great advancement in human knowledge. Not as great as fire, or the wheel, or language, but right up there. ;-)

Posted by bryan on February 04, 2004 at 6:49 AM


I threw in that old quip that "figures don't lie but liars sure do figure." I have to confess that I don't figure that well at all, I'm terrible at math, so I have to judge by the source. If it's from Handgun Control, Inc., or the Family Research Council, I know it's a lie. If it's from a more credible source, OK.
I think Gallup's polls are pretty accurate, thet've been at at it for a long time and don't have an axe to grind. Some other polls similarly. Getting a good enough sample is all-important. "All my friends" isn't too reliable. I remember hearing "I can't believe Nixon/Reagan won! All my friends voted for McGovern/Carter." I'll probably hear that again this time.
Recently, the American Family Association set up a poll on their site on homosexual marriage they planned to present to Congress. Trouble is, too many of us (and I do proudly say "us") took that poll and they ended up with some 60% in favor. They changed their minds. It was a lot of fun. Now, I know very well that a majority are not in favor, but not the kind of whopping majority those rats were hoping for. They don't have quite _that_ many friends (yet). Let's keep it that way!



"We recently cracked 300 million people, folks."

The Census Bureau says 293 million, with 300 in about a decade

Posted by Bill Woods on February 04, 2004 at 1:06 PM


I think your critique is off target. No, Moore doesnt account for population, but his point was simply to point out the gargantuan nature of the current federal budget. Of course there are explanations for it, but to any historically literate person they are obvious. Moore's point is correct and the illustation is both potent and valid, not as a comparision but to simple state: We really are doing a lot more in a single year than Government of USA did before 1900. A lot of stuff. A budget bigger than the GDP of France for example. Useful data point, not to imply we should rent out France to *be* our Government or anything, but to grasp the scope.

I for one cant fathom the scope:
"I have often maintained that one of the biggest problems with Washington is that no one can tell the difference between $1 million and $1 billion. But when Congress starts counting our tax dollars in the trillions of dollars it's like taking a trip to Michael Jackson's Neverland. One trillion dollars is a million million dollars. That's a lot of money no matter how you stack it."

So how to count an unbelievable sum: Moore comments that it is $50,000 for every family of four out there. $2.34 trillion on 290 million is of course, about $8,000 per capita. Are you getting $8,000 worth of Federal govt?


You ask:
"The big question: how much bigger, as a percentage of our population, and as a percentage of GDP, is government really? We should start with answers to those questions before we start determining how deeply we need to reign it back."

The answer is that prior to 1900, except for the civil war period, the Federal Govt was spending around 3% of GDP. Today it is around 20% of a far richer (and as you note larger) country.

The 20% of GDP is around where it has been for a while, so that is not the current concern IMHO, although imho it should be lower - around 15% of GDP is far more sustainable and in line with what would be consistent with a tolerable tax system.

The real problem is that in the 1980s we 'won' the Cold War and grew an economy while allowing a decifit. That's okay short-term and was a good bet when the berlin wall came down. In the 1990s, we faked fiscal rectitude by punting on entitlement reform and calling defense reductions "smaller Government". In this new Bush era, we now have guns+butter on spending, that is, higher spending levels, and (approriate pro-growth) tax cuts throwing the deficit back out of whack. But long-term, the trends are dangerous - medicare spending grows faster than the economy until it breaks the back of the Federal govt. and America flails in a sea of red ink.

Something's gotta give. Since I'm not an old geezer, what I dont want to see happen is we make things horrible long-term by staying comfortable for the next election.

In that context, Steve Moore's comments and the insinuation - Do we really need a Government this big? - is "moore" than useful. In FY 2002, we spent $2.0 trillion, in FY 2003, it was $2.16 trillion (8% increase), in FY 2004, estimating $2.31 trillion (7% increase). FY 2005 projects a 4% increase. ... This is better, but the damage has been done in the 15% 2-year increase already. We should settle on 0% total increase for this year, and cut where needed.

Posted by pat mcguinness on February 06, 2004 at 10:18 PM


He may not say what SPENDING has done since 1940, but he does say what government EMPLOYMENT has done - it has gone from 4 million to 21.5 million. If it were moving at the rate of population, it would have gone to 8 million. So, in employment terms, gummint is 2.7 times larger as a share of employment than it was in 1940. Not surprising, exactly, given the mission creep, but telling.

Posted by rvman on February 09, 2004 at 10:43 PM


He may not say what SPENDING has done since 1940, but he does say what government EMPLOYMENT has done - it has gone from 4 million to 21.5 million. If it were moving at the rate of population, it would have gone to 8 million. So, in employment terms, gummint is 2.7 times larger as an employment share of population than it was in 1940. (Employment/population has also increased since 1940, but more like 1.5 times, not 2.7 times.) Not surprising, exactly, given the mission creep, but telling.

Posted by rvman on February 09, 2004 at 10:45 PM


 



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