As I peruse the news, I periodically see headlines that are misleading in some fashion.
And if the headline is sufficiently off-key or bizarre, I feel compelled to grouse.
- A disappointingly inaccurate headline about the capital sinking into the sea.
- A grossly misleading headline about theft at the IRS.
- A very unsurprising headline about bailouts in Greece.
Now I have a new example, though I’m not sure whether to call it dishonest or clueless.
The EU Observer has a brief report that poverty has reached record levels in Germany.
Despite a booming economy, 12.9 million people in Germany were living below the poverty line in 2015, the Equal Welfare Association reported on Thursday. Based on figures from the Federal Statistical Office the alliance found a record high poverty rate of 15.7 percent in 2015.
By the way, I can’t resist pointing out that there is no “booming economy” in Germany. Growth in 2016 was only 1.9 percent.
Yes, that’s decent by European standards of stagnation and decline, but it’s far from impressive in any other context.
But I’m digressing. Let’s get back to the main point of today’s column.
As you can see from the story’s headline, the implication is that lots of people are left behind and mired in deprivation even though the economy is moving forward.
But there’s a problem with both the story and the headline.
If you read carefully, it turns out that both the story (and the study that triggered the story) have nothing to do with poverty.
No link at all. None. Zero. Nada. Zilch.
I’m not joking. There’s no estimate of the number of people below some measure of a German poverty line. There’s no calculation of any sort about living standards. Instead, this story (and the underlying report) are about the distribution of income.
…people [are] defined as poor when living on an income less than 60 percent of that of the median German household.
One might be tempted at this point to dismiss this as a bit of journalistic sloppiness. Indeed, one might even conclude that this is a story about nothing.
After all, noting that some people are below 60 percent of the median income level is about as newsworthy as a report saying that half of people are above average and half are below average.
But there actually is a story here. Though it’s not about poverty. Instead, it’s about an ongoing statist campaign to redefine poverty to mean unequal distribution of income.
I’m not joking. For instance, the bureaucrats at the Paris-based Organization for Economic Cooperation and Development actually put out a study claiming that there was more poverty in the United States than in nations such as Greece, Portugal, and Turkey.
How could they make such a preposterous claim? Easy, the OECD bureaucrats didn’t measure poverty. Instead, they concocted a measure of the degree to which various countries are close to the left-wing dream of equal incomes.
And the Obama Administration also tried to manipulate poverty statistics in the United States in hopes of pushing this statist agenda of coerced equality.
Robert Rector of the Heritage Foundation wrote about what Obama tried to do.
…the Obama administration…measure, which has little or nothing to do with actual poverty, will serve as the propaganda tool in Obama’s endless quest to “spread the wealth.” …The current poverty measure counts absolute purchasing power — how much steak and potatoes you can buy. The new measure will count comparative purchasing power — how much steak and potatoes you can buy relative to other people. …In other words, Obama will employ a statistical trick to ensure that “the poor will always be with you,” no matter how much better off they get in absolute terms. …The weird new poverty measure will produce very odd results. For example, if the real income of every single American were to magically triple over night, the new poverty measure would show there had been no drop in “poverty,” because the poverty income threshold would also triple. …Another paradox of the new poverty measure is that countries such as Bangladesh and Albania will have lower poverty rates than the United States, even though the actual living conditions in those countries are extremely bad.
Even moderates such as Robert Samuelson recognized that Obama’s agenda was absurd. Here is some of what he wrote.
…the new definition has strange consequences. Suppose that all Americans doubled their incomes tomorrow, and suppose that their spending on food, clothing, housing and utilities also doubled. That would seem to signify less poverty — but not by the new poverty measure. It wouldn’t decline, because the poverty threshold would go up as spending went up. Many Americans would find this weird: People get richer but “poverty” stays stuck.
To put this all in context, the left isn’t merely motivated by a desire to exaggerate and misstate poverty. That simply the means to an end.
What they want is more redistribution and higher tax rates. The OECD openly admitted that was the goal in another report. Much as all the fixation about inequality in America is simply a tool to advocate bigger government.
P.S. Germany is an example of a rational welfare state. While the public sector is far too large, the country has enjoyed occasional periods of genuine spending restraint and German politicians wisely avoided a Keynesian spending binge during the last recession.
P.P.S. Though Germany also has its share of crazy government activity, including a big green-energy boondoggle. And lots of goofy actions, such as ticketing a one-armed man for have a bicycle with only one handlebar brake, taxing homeowners today for a street that was built beginning in the 1930s, making streetwalkers pay a tax by using parking meters, and spending 30 times as much to enforce a tax as is collected.
[…] Grossly dishonest headline […]
[…] Grossly dishonest headline […]
[…] The Equal Welfare Association […]
[…] The Equal Welfare Association […]
[…] You can find similarly dishonest ways of measuring poverty from the United Nations, the Equal Welfare Association, Germany’s Institute of Labor Economics, the Obama Administration, and the European […]
[…] hucksters” include the OECD, of course, and also the United Nations, the New York Times, the Equal Welfare Association, Germany’s Institute of Labor Economics, the Obama Administration, and the European […]
[…] You can find similarly dishonest ways of measuring poverty from the United Nations, the Equal Welfare Association, Germany’s Institute of Labor Economics, the Obama Administration, and the European […]
[…] (que es lo que obtenemos de grupos izquierdistas como la ONU y la OCDE , por no mencionar la Asociación de Igualdad de Bienestar, el Instituto de Economía Laboral de Alemania y la Administración de […]
[…] is what we get from leftist groups like the UN and OECD, not to mention the Equal Welfare Association, Germany’s Institute of Labor Economics, and the Obama […]
[…] of poverty (which is what we get from leftist groups like the UN and OECD, not to mention the Equal Welfare Association, Germany’s Institute of Labor Economics, and the Obama […]
[…] The Equal Welfare Association. […]
[…] poverty rate (other groups that have used this deliberately dishonest methodology include the Equal Welfare Association, Germany’s Institute of Labor Economics, and the Obama […]
[…] poverty rate (other groups that have used this deliberately dishonest methodology include the Equal Welfare Association, Germany’s Institute of Labor Economics, and the Obama […]
[…] « Story about German “Poverty” Features World’s Most Dishonest Headline or WorldR… […]
P.P.S. Leftists continue to obsess over the redistribution of a presumably fixed pie.
Yet, at current long term world growth trendlines of four percent, …
in the next thirty years we will make more than two extra whole pies,
in the next fifty years six more whole pies,
and by the end of the century twenty five more whole pies.
Why fret about redistribution of the current pie? Our focus should be on the enormous compounding effect of growth, the making of more pies, which requires unaffected effort/reward curves so that people remain motivated.
While those who grow by four percent annually will make twenty five more pies,those who grow by only half that, like e.g. Germany, will only make four more pies.
And, perhaps even more important, remember WHAT will these extra future pies contain. Not only the number of pies is increasing but new pies are ever better than the old ones. These newer pies will contain stuff that you cannot buy today — at any price!
Growth is the elixir of prosperity. And the motivation that accompanies lack of redistribution is the elixir of growth.
So, want to do your kids a favor? Get your eyes off your neighbor’s wallet!
Don’t any one of you get rich now…. it’ll make me look poorer! ….Even if you shop more at my store…., thus increasing my wealth some…., without me actually doing anything.
Well, I guess I am doing something after all. I’m actually refraining from my inalienable democratic right to vote your new fatter wallets in my direction. Aren’t you grateful now?
People must be very wealthy in Cuba and North Korea. Since in those societies most people have nothing, there are probably very few people that have less than sixty percent of nothing.
Backtracking a bit, it is not actually unreasonable to measure things in relative terms. We always do. For example, an overwhelming majority of people on earth are much better off than nobility was even a mere two centuries ago. Virtually all humans alive today are better off than 99% of the humans who ever walked on the earth. So we should all be happy? Should we declare the end of poverty? Obviously there are still many people that we would consider poor in the world given our modern elevated standards, and we are virtually all poor today even compared to the poorest of people in the year 2100.
So, it is not illogical to look at prosperity in a relative way. But there’s a practical problem with that approach of forced equal outcomes: Ironically, those countries that go down the path of enforcing equal outcomes, will soon find their total prosperity fall below sixty percent of the world average.
That is exactly NOT because these more redistributive countries will decline in absolute terms, but rather, because countries that allow bigger disparities of outcome have more motivated populations, grow faster, and raise the average world standard to the point where your redistributionist country first becomes a middle income country and then eventually a poor country. E.g. Argentina.
Germany, with a growth rate trendline around half the world average is certainly on that trajectory. Of course not quite as bad as her more statist partners in the EU who will reach that middle income country fate a lot sooner. As I said many times, in a continent where endemic growth has fallen to just half the world average, or less, nothing is sustainable. It’s only a question of how far down they will have to fall before they cry uncle.
Americans should not laugh because on current growth trendlines they are circling the same drain. It is that things in America still have a (small) chance of turning around.
But the chance is small nonetheless. So keep your eyes open for some (likely small jurisdictions initially) that will lead the world into the new fantastic prosperity and human capabilities of the latter half of this century. That is where you will want to go. In other words,…hope for the best in America, but keep your boat watertight.
In summary,
The leftists of envy have two choices:
(a) either accept the mansion at the end of the cul-de-sac and remain the citizen of a top prosperity country or
(b) vote some of the mansion in their direction and have their country descend into the middle income country group by midcentury.
What will the voter-lemming choose? Well, for most voter-lemmings…”Better a dollar of redistribution today than five perpetually compounding dollars of high growth in the future.”
P.S. On a somewhat side note, and this may be a bit off topic, but I’m becoming more and more convinced that: even though I’m not personally religious, in a democracy most people without any kind of higher religious morality guidance inevitably become socialist jerks.
Perhaps a topic for more future philosophizing.
Thanks for for your article! By definition (you cited it) poverty levels can only rise. As poverty is defined by people earning less than xx % of the median income the numbers of so called poor people will increase when population grows and income rises.
To define poverty like that is not science it is just stupidity!
Just take a look at the German federal budget. About half of the whole budget is spent for anything connected to social welfare. And state and local budgets are not even counted in.