Numbers in the Media Are Almost Meaningless

Every time I dig into numbers in a media report, I typically find a real mess.  Russell Roberts finds the situation even worse than average in the recent Washington Post article on middle class finances.

The debt figure of $55,000 in 2004 (which supposedly is 151% higher
than in 1989 to pay for day-to-day expenses) is actually ALL forms of
debt INCLUDING mortgage debt. So how can that be? How can the median
family have only $55,000 of all kinds of debt when there's $95,000 of
mortgage debt all by itself?

That's because each line of the chart (other than the top line and
the bottom line) is a subset of all families and a different subset.

So among families that have mortgage debt (maybe 40-50% of all
families) the median mortgage debt among those families is $95,000.

But among families that have any kind of debt, (about 3/4 of all families) the median indebtednes including all kinds of debt
is $55,000. That includes mortgages debt....

So you can't add up any of the lines of the chart or even compare
them to each other. They're each for a different subset of the
population, the population who have that kind of debt or asset.

  • Bill

    Not surprising. Between the lemming-like group-think that infects most newsrooms, and the fact that most reporters with whom I have worked have been almost completely innumerate this sort of garbage is almost to be expected.

    I've found that ridiculous numeral factoids become accepted truth if they fit the news meme, since I've yet to meet a reporter who had a good grasp of statistics, and many can't read a spreadsheet.

    This is based on some 40 years of radio and television experience, and I don't see any evidence that the situation is any better in print newsrooms.

  • Georg Thomas

    What is worse. The economists and statisticians behind it haven't got a clue. Or have you ever met an economist aware of the subject-matter of his discipline, or a statistician that understands the embarrassing limitations of the science that makes him feel so special? Ever since economists developed their inferiority complex (a 100 years ago? Ahhh, are we exact scientists?), they reverted to something they understand even less than economics: basic statistics and (mostly) rudimentary maths, which induced mathematicians to add their pompous ignorance of the real world to a promising march into the wrong direction. The blind leading the blind. Journalism simply being the most general, the most watered-down aberration of that aberration.

  • kuntal

    So what you are saying is out of 100 families;
    40 of them (those with mortgage) had average 95K debt; and
    75 of them (that includes those 40 with mortgage debt) had average 55K debt.

    That means debt for those 35 people who do not have mortgage debt is 10K or less.