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We’ve often heard many different people use statistics to back up their claims, to justify policies or explain why we need to modify some laws or bills, and sometimes write up and pass new ones. This is not an alien concept. In fact, most people expect others to explain their actions and ideas, especially when dealing with politicians or economic matters.
Politicians are supposed to be held accountable to the population, and thus, have to justify everything they do with our collective money harvested from our taxes. The concept of democracy requires that our collective money be used in a manner understandable by all citizens, and that most agree on how it’s spent. But in recent years, misusage of statistics has been more and more present in our everyday life, misleading the population on many important issues. Whether it’s a voluntary miscalculation, a “creative” way to present numbers or the important omission of some vital facts, more and more people are jumping to biased conclusions, mostly due to biased statistics.
But how come statistics can be biased? Aren’t they based on real numbers, usually collected from trusted sources? Well, yes, they are. So what’s the problem then?
Many things.
Misusage by numbers manipulation
Numbers manipulation is when people are distorting the results by usage of various calculations until the numbers go along with what they try to advocate. There are numerous ways to make numbers speak what you want them to say. Let’s work with a simple example here.
Let’s say there’s a country out there called “Malogne” that only has 5 citizens. 4 of those citizens are earning $15,000 per year. The other earns $500,000 per year. One might then say that this country is extremely rich, since the average income is $112,000! What this number doesn’t tell you though, is that 80% of Malognians are only earning $15,000.
Let’s now say that Malogne is like most modern countries out there, where poor people usually pay less tax than the rich ones. To simplify things, let’s make only two tax brackets. Malognians earning under $100,000 pay a 15% income tax. Those above $100,000 pay 35% income tax. That would mean that those 4 citizens earning $15,000 would pay $2,250 in tax each. The Malognian earning $500,000 would pay $175,000 of income tax. Someone could then say that the Malognian earning $500,000 pays more than 97% of all the taxes paid in the country, and argue that this is an injustice. Don’t be fooled, it is not.
Even if we use a flat tax rate of, let’s say, 25% for all, he would still pay around 90% of all the taxes paid in the country. And THIS would be an injustice, since a flat tax rate of 25% for all would mean that those earning $15,000 would end up with only $11,250 left in their pocket at the end of the year (a drop of $1,500), while the richer Malognian would end up with $375,000 in his pockets (an augmentation of $50,000). So every poor people would then be paying so that rich ones could keep more in their pockets.
What these examples show us, is that manipulating numbers is easy. Statistics shows that 80% of the population of Malognia is poor, yet, we can say that average income is $112,000. Statistics shows that 20% of the population pays 97% of the taxes, but don’t mention that this 20% owns over 800% more than everyone else combined.
Misusage by fact omissions.
Another misusage of statistics worth mentioning is when statistics are applied in a context where numerous other factors have to be taken into account to get a clear picture of the situation. For example, when a government said that 100,000 jobs were created over the last three-month period, it doesn’t specify what type of jobs those are. If part-time and contractual jobs are calculated exactly like full-time, permanent jobs, then those stats are misleading. While there might be really 100,000 jobs created, when said as an indicator of economic activity, it is clearly misleading. And how about the number of jobs lost? How about calculating the average salary of all jobs lost versus the average salary of all newly created jobs? If an employer fires a permanent employee and replace him with two, part-time workers, would you say he actually created more jobs? That this is good for the economy?
Another example would be the Montreal Economic Institute who published in 2003 a document claiming that capitalism is good for the environment. How they came to this conclusion? They said that we live longer now than 100 years ago, thus, it must be because our environment is better. They also said that our water is less polluted than 100 years ago, meaning that our environment is getting better too. What they don’t say is that the reason we live longer can be clearly associated with advances in medicine (something they chose not to say), not a better environment, and that if our waters are less polluted, it’s mainly because polluting industries chose to move to countries that have less restrictive laws regarding pollution (another thing they “forgot” to say). Besides, from cover to cover, the author makes links between statistics without ever explaining why, and this brings me to my next point.
Misusage by association.
Let see. If I say that gasoline prices are now 25% higher than 2 years ago, and that voters turnout in local elections was 25% lower than 2 years ago, would that mean that higher gas prices makes less people vote in an election?
That sounds pretty silly, doesn’t it? Then how come we’re accepting this kind of argumentative logic when economists, businessmen and politicians are using it? Sure, my example up there was a bit on the extreme side, but how many times have we been subjected to people making a link between two different statistics, without ever proving that said link actually exists and that other factor didn’t contribute?
So, what can we do about it?
Just be aware, and don’t be easily fooled. Many people are using these tricks to make statistics serve their cause; politicians, businessmen, economists. Anytime someone try to use statistics to back up their claims, always ask where those numbers come from, and have a look, if available, at the original numbers used to calculate whatever value is put up in front of you. Sometimes, this can be quite revealing.
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