Explaining “The most important chart about the American economy you’ll see this year”
See update at bottom.
Pavlina Tcherneva’s chart has been getting a lot of play out there:
Vox/Matthew Yglesias labeled it “The most important chart about the American economy you’ll see this year.”
Scott Winship at Fortune came back at it on methodological grounds, with the headline “No, the Rich Are Not Taking All of the Economic Pie (In 8 Charts).” He ends up with what he calls the “money chart,” supporting his headline:
Yglesias responded, and Winship responded to him.
The basic contention at this point: who is actually “explaining” the situation?
Do Scott’s corrections explain the situation better? Do they paint a 1. more accurate, and/or 2. more complete picture? By those two standards, is he more honestly and fully informative? Let’s run through his changes.
1. The household method as opposed to tax-unit method is at least a useful additional measure, and is arguably more accurate and explanatory. It’s also less complete because the data only goes back to ’79. But he completes it with Tcherneva’s (by this standard less-accurate) earlier data. It’s a useful addition to understanding, but with little change in the story it tells.
2. The full-business-cycle approach (as opposed to just showing expansions) is also arguably more accurate hence informative. But it (necessarily?) ignores the post-2007 period because the current business cycle isn’t over yet. By Tcherneva’s measure this period is far and away the most egregious demonstration of the inequality trend we’re examining. Scott could have included recent years, with visual and verbal caveats explaining that the cycle is not complete, so the measure that period is not directly comparable. It has less explanatory power, but that doesn’t mean it has none. Omitting the very period that by Tcherneva’s measure are the “money proof” of the trend (and so omitting explanations of that period) arguably explains less about that trend.
3. Looking at the non-elderly population is arguably more accurate and is at least quite informative. It paints roughly the same picture, though less extreme.
4. Post-tax-and-transfer measures are arguably more accurate and informative, but again with the completeness problem. And he should explain that the pre-’79 picture would look quite different if it displayed post-T&T data; the bottom 90% would have been getting more of the pie, which would make the inequality trend look more pronounced than it does in his graph.
I do wish he’d shown a graph as he suggested, including health/medical benefits in T&T (assigning a value other than $0), while explaining the methodological difficulties he points to. I have no idea how or how much this would change the picture.
5. Omitting capital gains (because they’re hard to measure) for the final “money chart” — suggesting that it’s the most accurate, complete, informative, and definitive chart — is a massive hit to accuracy and explanation. Cap gains are the very vehicle, the primary means, by which the increasing inequality we’re trying to understand is realized. “The data might not be accurate” begs the question: Is ignoring that data more accurate? To use Scott’s own words, “assigning a value of $0 is surely not right.”
So some of Scott’s corrections help to usefully and informatively explain the situation better, or at least more. But to summarize the changes that are less informative or downright misinformative:
• The blatant inaccuracy of ignoring cap gains in #5. It completely misrepresents the situation.
• The omission of recent years in #2 — the very years where the trend is arguably most apparent and egregious. Hiding the elephant under the rug?
• The blithely dismissive headline of Scott’s first post.
With these combined, I hope Scott can understand why many see his post as an effort to pooh-pooh and obfuscate the whole subject — the very antithesis of “explaining.”
Part of that hand-waving, obfuscation, and general chaff-dispersal is the proleptic “but of course you’re right” rhetorical ploy, right up front in Scott’s second paragraph:
Let’s stipulate that income inequality is at staggering levels in the U.S., and that income concentration at the top has probably risen (probably)
One really must ask: if income inequality is at “staggering” levels, how did it get there…if it hasn’t risen?
How do you square that staggering stipulated reality with Scott’s headline assertion: that “the Rich Are Not Taking All of the Economic Pie.”
I can’t see how to draw any other conclusion from this direct self-contradiction: he’s talking out of both sides of his mouth. I’ll leave it to my gentle readers to decide why.
Takeaway: obfuscation is the opposite of explanation.
Update: Scott has taken issue with my only-barely-implicit imputation of his motives. He’s right on that. I both regret that and apologize for it. I still think the import of his post (especially the “money chart” and title) — that inequality’s not that bad and not that important — contradicts his “staggering” stipulation, and is rhetorically pernicious. But that’s not the same as bad faith. I withdraw and apologize for any suggestion of the latter.
Cross-posted at Asymptosis.
“Takeaway: obfuscation is the opposite of explanation.”
Obfuscation does explain something else important, though, at least implicitly. People tend to only accept explanations that confirm their prior bias. For any non-confirming explanation there are always available as many obfuscations and counter-explanations as may be required to at least muddy the waters.
Realization of this human feature needs to be the starting point of deliberation rather than an afterthought.
“Hiding the elephant under the rug?”
How do you make an argument to change the argument? Change the data. I would be asking why different charts with different dates and why different results.
Fellas there is only one thing that need be asked. What organization pays the guy’s, Scott Winship that is, salary? The Manhattan Institute!!! Holy Cow, as Rizzuto might have said. Unbelievable that Winship’s crap scholarship is even referred to beyond the pages of Forbes. Take a look on the Wikipedia page for that cesspool of ill thought out policy initiatives,
My god, Bill Kristol and Marice Greenberg (of AIG fame) are amongst their many members of the Bd. of Trustees. Judith Miller is listed as one of their experts with an expertise in: • Counterterrorism (their spelling error, not mine), National Security, Middle East and Civil Liberties. That’s the same Judith Miller of the NY Times and the charge to war brigade. http://www.manhattan-institute.org/html/scholars.htm.
Why do we continue to give space and acknowledge the existence of such bull shit? Yes, Steve dies a good job of critiquing Winship’s crap. Better to simply point out that Winship is no scholar and his scholarship, as such, is only acceptable in propaganda press releases.
Where does Winship get off getting all huffy about an implicit attack on his motives, when he is the one who launched both an implicit attack (“ideology”) and an explicit one (“bad faith”) on Matt Yglesias?
That sounds like a real phony, doesn’t it?
And by the way, just why did he expend so much energy with relatively small impact on the conclusion if he didn’t have a motive of some kind that would supply that much energy?
It is called deflecting.
Winship works as a propagandist for a propagandist organization. He and his cohorts can say anything that they want to say, supported by facts or not. They welcome the argument because it lends a modicum of legitimacy to their bull shit arguments. In effect they sit back and say to the world, “See we’re only arguing over the details. Our side of the argument is as valid as is the other.” Except no it isn’t. False equivalency!!
Part of me wants very much to agree with you and simply dismiss things that come out R-W institutes and think tanks as nothing but self-serving and disingenuous crap.
I can’t do that though because it ultimately serves part of the purpose of these groups. Failing to engage, challenge, and debunk poor scholarship allows it to proliferate. In these days of the Internet and broad distribution of information it is simply too easy for groups to put out crap and allow followers to grab onto it as definitive. Ultimately that creates an atmosphere where each side simply says, “Well that came from so and so and it is therefore useless”. That lessens the chance to change minds.
In several of her posts Beverly has advanced the idea that a winning strategy entails debunking disingenuous bullshit and doing so proactively.
Challenging obfuscation both clarifies and ultimately leads to testing and strengthening our arguments.
And while I suspect that I’m safe in saying that the leadership of groups like Heritage and Manhatten operate from a position of bad faith, I’m not ready to say that everyone who works at these places does the same. They may be wrong, they may even be deluded, but challenging their work may act as a brake, at least for some.
Finally, Conservatism is essentially tribalism and anything that simply dismisses other groups plays into that mindset. Good ideas, good data, good methodology and practice need to banish their opposites from the field by fact and reason not mere dismissal. A lie told often enough becomes, for many, a sort of truth. It may be tiring but challenging bullshit, or just error, has the value of disrupting its path to “truth” through repetition.
Unfortunately bad ideas rarely die a complete death, the answer is continued and repeated vigilance or as Barney Fife might say, “Nip it, nip it in the bud”.
You will always have a place at the Angry Bear table.
A couple of comments from Chomsky serving as a judge on the X factor.
1. “In his first outing as judge, Chomsky quickly made his mark. ‘Your act is part of a propaganda state promoting a culture-ideology of comforting illusion’, he told one hopeful young girl, before adding, ‘I’m saying yes.”
2. “Not satisfied with attacking the acts, Professor Chomsky then turned his critique on The X Factor audience. ‘You are all complicit in a hegemonic construct designed primarily to keep you from questioning what is really going on in the world,’ he told them, ‘You must learn to think critically and reject the pernicious cult of celebrity.”
Hmmm, the proper question to ask now is; “how does this fit with the faux anger at a comment?” Think about it. http://languagelog.ldc.upenn.edu/nll/?p=14274
“‘There is a lot of talent out there,’ said Chomsky, ‘but I have my eye on an anarcho-syndicalist Peruvian flute band who are really going places.’”
I agree with you in part. What I am saying is that the emphasis of any argument must be on the facts of the matter and that spurious interpretations of those facts, or misrepresentations of those facts, cannot be the focus of one’s approach. In effect the truth will out if the truth is repeated often enough and not simply as an alternative to the lie. In fact the truth should not be presented as an alternative, but only as a matter of fact and a result of careful measurement and collection of data that supports a truth. To present alternatives to the truth in an effort to weaken the effects of such alternatives is not demonstrably constructive. As I noted previously the presentation of the facts as though they are arguably distinct from the misrepresentations of such facts requires the repetition of the misrepresentation. That repetition is unnecessary and only serves to suggest that the facts are arguable. Provide the facts of an issue and the measurable data that support the identification of those facts. Make note of the persistence of misleading interpretations of either the data or the facts, but so not detail the misrepresentation as though there were two sides to the debate. Facts are not open to debate. It is similar to trying to argue the existence of god. No amount of argument will end the debate because it is an idea that is not subject to an operational definition. No facts can be presented on either side of the argument. The propagandist approaches all facts as though they are debatable and/or open to interpretation. Observations may be subject to interpretation, but facts are only subject to measurement once they have been defined. The propagandist uses the confusion between observation and facts in order to reinterpret or misinterpret facts in an effort to distort a groups’ observations.
“Update: Scott has taken issue with my only-barely-implicit imputation of his motives. He’s right on that. I both regret that and apologize for it.” “……and is rhetorically pernicious. But that’s not the same as bad faith. I withdraw and apologize for any suggestion of the latter.” Steve
A gentleman’s approach that can’t be faulted, but one is known, Scott that is, by the company they keep. The M-I for Policy Research is a den of pernicious iniquity judging from its list of Board members and so-called scholars. Example par excellence, Judith Miller, formerly a journalist able to point out men with baseball caps pointing out weapons of mass destruction is only one example of the company one keeps at M-I. I think we can call a spade just that.
Critical thinking requires critical asking; valid (logic) questions.
First, why did you assume thus and such? What does thius and such mean?
Explain meaning in terms of relevance……..
https://bookofbadarguments.com/?view=allpages From Barry Ritholtz: Logical fallacies e-book
The problem is often that critical thinking and American public do not compute. Critical thought and electoral behavior are often an oxymoroonic process in this country. Man on the street interviews persistently indicate that American public are in love with their government sponsored and/or administered programs from education to health care to quality of the air, roads and water ways. All are programs that the conservatives political class loudly proclaim that they want to slice, dice and eliminate. Yet that same American public toes a Republican electoral line. “Keep your government hands off of my Medicare,” case in point.
“How do you square that staggering stipulated reality with Scott’s headline assertion: that “the Rich Are Not Taking All of the Economic Pie.” ”
Needs work: “the Rich Are Not Taking All of the Economic Pie, Just Most of It.”
All: I agree with you. I’m arguably too nice a guy. And I don’t mean that in a good way. But a mea culpa, once given, really shouldn’t be retracted. (See? See?) So watch for future posts on this.
I do not remember saying you were a nice guy. 🙂
I always have a little bit of a problem when people start using household as the relevant measure. So if adult children are living at home, because they cannot afford not to, or if mothers are having to work longer than they would like, this is a positive? Shouldn’t per capita be the correct divisor?
It depends what you’re trying to understand, and also how the data is collected.Different measures tell you different things.
Every economic assertion should be preceded with the phase “by this measure” (or “these measures”), and you should probably look at multiple measures before making any strongly declarative economic assertions.
I would suggest that voting for the lessor of two evils favors the top 10%. Just vote in evil till the lessor understands the changes needed.
The most blue state in the Nation just handed the private utilities companies in Ma. a 37% increase because they did short term thinking, on the rising cost of fuels. Yet one of the few publicly owned utilities in Ma. only raised prices 1%.
Continue the above post.
Maybe voting for other than evil or lessor evil; a vote for an independent or third party candidate is not really a wasted vote.