Pop-up economics at St Pancras: not a crazy idea

I was walking through London St Pancras Station Monday lunchtime, and I thought: “That sounds like Tim Harford, the guy who presents More or Less on the radio”. This thought is not as weird as it seems. I listen to the podcast, and occasionally steal his ideas. I like him because I have an exaggerated respect for economists who talk like ordinary people, having met far too many of the other type.

By chance I was passing at exactly the right time to hear him record his new programme, Pop-up Economics, in which he stands up in front of people and tells them stories about economics. The first episode is on Radio 4 tonight. Here’s a really bad picture I took on my phone. It proves I was there, but not much else:

A bit of Tim Harford's head. Look, there were a lot of people there, ok?

A bit of Tim Harford’s head. Look, there were a lot of people there, ok?

He performed two stories, apparently from memory, of about 10 minutes each. I’m not going to tell you about them, because they were excellent – so it’s better if you listen to them on the radio (I think this show will be broadcast on 23 January, but you can listen to it on iPlayer afterwards). I can reveal that the first story covered the best way to match kidney donors to people who need a kidney, and the second one was about Full Tilt Poker. As someone who teaches people to tell stories, has an interest in economics, and who plays poker at Full Tilt, I couldn’t have been happier to hear what he had to say – unless I was suffering from kidney failure, I suppose.

Joy Index, part two: US three times less depressed than Europe

If you find this image of despair stimulating, click on the image to go to “The brokers with hands on their faces blog”

Diligent Talknormalists will recall that, just over a year ago, I introduced the Joy Index to measure the mood of the English-speaking world. The index was compiled by dividing the number of stories in the news media mentioning “joy” by the number mentioning “gloom”. I exclude sports reports, which are fun but produce a transient excess of both; and obituaries, where our joy or gloom at someone’s death would probably owe more to that person than the state of the world.

When the line goes up, we’re becoming more joyful. When if goes down, we’re becoming gloomier. Actually, the index is dominated by gloominess – the amount of joy in our lives, or at least in the newspapers, is remarkably stable.

In the US, the average of the Joy Index was at an unsurprising historical low, just above 2.0, during 2008 – the same level as it reached in the week of the 9/11 attack. In the first week of August 2011 it was all the way down to 1.62.

So, first the good news! In 2012 the US has been, until recently, much less gloomy if we take a monthly average: the TN Joy Index has kept well above 2.0 at all times. Of course, October was a gloomy month. Hurricanes are like that. But, compared to the darkest days of 2008, there’s between two and four times less gloominess in the news:

Meanwhile, in Europe, the English-language press isn’t so optimistic. The index shows there’s about three times as much gloom for each unit of joy as there is in the US. I blame austerity, or maybe socialism:

It is, in the words of the nonsense phrase, a global world. It’s possible that Americans just don’t like to write about gloomy things as much, though that would be a recent phenomenon: last time I calculated the index, there wasn’t this US-Europe split. Most of the time, we are all in it together. When you take the indices in November 2011 as a starting point, the ratio of joy-to-gloom in Europe and the US rises and falls in just the same way (until Sandy in October):

We’re on the same emotional rollercoaster – it’s just that Europeans really, really want to get off. This could be because, more often, the ultra-gloomy news has been happening in Europe. When the index dipped, the three most important topics in gloomy stories were the Euro zone, consumer confidence and Central Banks in Europe, and Euro zone, consumer confidence and monetary policy in the US.

When the index went up, the gloom story headlines showed no strong pattern. Clearly it is better to worry about many things, some of the time, than one thing, all the time.

Think of the upswings in the Joy Index as having a hangover while it is raining outside, your car needs a new gearbox, and a small child has been singing really annoying made-up songs for three hours. Never mind! In the Joy Index downswings, your life would be exactly the same – except the bank repossesses your house as well.

One final point, for those of you who read blogs while wondering, “this is all very well, but what do the markets think?” Since November 2010 the US Joy Index has been a statistically significant predictor of the size of the month-end change in the Dow’s moving average. As I said last time: sell gloom, buy joy.

The dangers of data journalism

The World Bank: “Our mission is to fight poverty with passion and professionalism for lasting results” it says. It also provides shelter from the rain for that little panda.

My previous post on data journalism might have conveyed the impression that I think it will cure all the problems of the press-release-rewriting style of journalism that readers of the Metro, for example, experience. Following several emails, I think I need to clarify.

I praised BBC Radio’s More or Less, but Matt Berkley emailed to criticise the programme’s feature on the World Bank’s global poverty stats, which he thinks “misleads in several important aspects”. Matt’s comment interested me (not least because I have, in another life, done some research on global poverty statistics), so I had another look. Feel free to read his complaint to the BBC and compare it to the published story, or the podcast.

Data doesn’t remove the room for debate, it just shifts the debate on to different territory. A data journalist will still make value judgements – but those should, where possible, be informed by statistical analysis, not an appeal to authority.

Now, attempting to report world poverty in a newspaper article sets the bar extremely high: even the meaning of the word “poverty” is a value judgement.

We can do better than “world poverty is decreasing because the World Bank says it is”, which is a simple appeal to authority: those guys are the experts, so they must be correct.

Given the world Bank report, journalists may ask:

  • Why we pick a certain income level to indicate poverty? Even if we accept that far fewer people now live on $1.25 or less, there are almost as many people surviving on $2 or less as there were before. The poverty line may be defined as not starving, or not having some defined “basic needs” met, or not being among the poorest 20 per cent in your country. These are all different numbers, and all used by economists. Note: you can’t eradicate the last type of poverty, in case you were wondering.
  • Whether we correct an arbitrary poverty line for the relative price of the things that poor people buy in different countries (also, how do we decide what those things are? The poor in different countries eat different food, and have different habits, which may make some parts of the world seem richer, when the quality of life is no better).
  • Do we use a measure of earned income, or of what those people can eat or trade? The urban poor may have a bit more cash than the rural poor, but don’t have domestic animals, for example, so they might spend more but eat less. This is very difficult to measure.
  • Most seriously, do the statistics use data to manipulate the headline? If you have done the rest of the analysis, this becomes clearer. Governments (or World Banks) are sometimes accused of picking a threshold, or a measurement process, to suit a carefully-chosen good news agenda.

An example of the final point: the government of Cynicalia wants to claim that it has abolished poverty, with the poverty line defined as $1.25 a day (as the World Bank defines it). There are a million working class Cynicalians earning on average $1 a day, and a million middle class Cynicalians earning on average $3 a day, and the president and his family earn $100,000 a day. It might squeeze the middle so that there are two million people earning $2 a day, while not redistributing the president’s wealth at all which is hidden in Switzerland. The government can now send a press release claiming that no one is poor, and that more than half the country is as well off, or better off, than before the reform.

A journalist can check the numbers of poor people at different poverty lines (maybe even using different measurements of income), investigate how the poverty line is calculated, or examine the effect of different redistribution policies. The figures exist, though working out how they were calculated can be a headache. All this takes time and some expertise, which is a problem.

Or the newspaper can just give up, and tell the journalist to repeat the government’s claim that Poverty is History. In which case that journalist is a loyal Cynic.

The article that Matt criticises covers many of the assumptions on poverty lines in some detail, and highlights their shortcomings. He feels the BBC should have done better.

I don’t agree with most of Matt’s complaint, for two editorial reasons. The first is that, where assumptions are made, I think they are clearly and accurately spelt out. The second is that this feature does not attempt to support a conclusion, merely to investigate how we calculate it (I also disagree with his analysis for a couple of economic reasons, but this is not the forum to air that discussion).

Data journalism is becoming trendy. I wish I’d written about Nate Silver in 2008, before I looked like a bandwagon jumper. But here’s the point: statistics do not resolve all arguments. A data journalist needs to understand how the data was collected, how it is presented, and whether the conclusions are justified by the data. The journalist also needs to resist overclaiming, based on a the emotional appeal of what the data seems to say.

I can show you plenty of examples of bad data journalism, where a little understanding can be as bad as none at all: I’ll leave it to you to ask.

Nate Silver’s numbers game

Nate Silver: hard to believe this man is a statistician

For the second US election in a row, the winner is a guy called Nate Silver, who might be the future of intelligent journalism. He rescues us from the tyranny of columnists who simply write about the comments of their own heads.

Nate blogs at fivethirtyeight.com, which is, since 2010, a New York Times blog. He analyses opinion polls, but he does it very, very well. He is entertaining and readable, even if you don’t care who just won the election in the US.

I discovered Nate’s analysis by accident in 2008 when I was looking for some statistics to undermine one of the nuttier blog opinions by data-lite controversialist Melanie Phillips (which made it very nutty indeed). Fivethirtyeight has a rigour that journalism seems to have mislaid in the internet era in a search for sensation. He does a seemingly simple thing extremely well: when an opinion poll is released, he adds it to a model which creates an aggregate. If the model is well-constructed, this has smaller margins for error and less chance of systematic bias. It is more likely to reflect the true state of the world.

The clever part is that he doesn’t just produce an average. He weights the polls, depending on their sample size, the way the information was obtained, the historical accuracy of the polling company, when it was conducted, the exact question that was asked, and so on. He looks for statistical bias – a consistent under- or over-reporting of candidate’s popularity. He adjusts his own model if he finds evidence that it is biased. Importantly, he writes nerdy blog posts about what he is doing, explaining his reasoning, and pointing out possible flaws in his work.

The result is that “outliers” – polls that, through random sampling, produce a freak result – have little importance on Fivethirtyeight – while on the internet and the news channels they tend to dominate the agenda, albeit fleetingly. This means his reporting is less shouty, but it has proved to be stunningly accurate for two elections in a row: at the time of writing, his analysis has correctly predicted the result in every state for the 2012 US presidential election, and the electoral college vote too.

Having a model doesn’t necessarily mean you will be correct – there are plenty of other statistical models which predicted the election less accurately. Fivethirtyeight carefully spells out the steps in its analytical process (though not the precise parameters of the model), so we can make an informed judgement on the quality of the findings. Any model is open to criticism from other statisticians - but this means they can have an adult, public conversation about what might be improved, or what the impact of a flaw in the analysis might be. We can learn from this, too.

This wouldn’t be important if it was just a different way to present the same news; but this type of analysis creates fresh insight. By polling day 2012, the model predicted a greater than 90 per cent chance of an Obama victory; and yet organisations like the BBC and the FT were using lazy phrases like “too close to call” and “on a knife edge”. If newspapers are prepared to do this type of analysis routinely, I suggest, it offers huge potential for creating an open, analytical type of serious journalism led by numbers and observed reality, not opinions.

Old jokes department: “And what do you do?”

Not every journalist can be a stats geek, though I think they should have more compulsory education in how to interpret data, and would prefer that newspapers enforced an in-house ban on reporting surveys that are statistical nonsense – which, in my experience, is most of them (I’ve written those survey-based articles in the past, and reported lots of rubbish data as if it were spotless, which I regret).

Newspapers and magazines are cutting back on conventional journalism. Budgets are tight. It’s probably too much to hope that we can create a new type of data-journalist, or that newspapers will suddenly grow a statistical conscience. It needn’t be expensive: a laptop and some specialist software is perfectly adequate to do the statistical research that can validate the claims that powerful people make. It’s the job of the media to investigate these claims – not just talk to one person who agrees, and another who disagrees. On Radio 4, More or Less does an entertaining job of validating reported statistics (download the podcasts, they are excellent). Ben Goldacre’s Bad Science posts are also a model of this approach.

It’s patronising to assume that readers can’t cope with statistical analysis. Clearly, many don’t like it, and some misunderstand it; but that’s true of any type of journalism that goes beyond the obvious. The conclusions (especially those that go against gut feel or conventional wisdom) may be unpopular: just read the critical comments on Nate Silver’s blog. It’s also true that science isn’t the last word on a subject, just a powerful way of testing an assumption. Statistics involves making value judgements in how you treat the numbers, in the same way as a journalist makes a judgement about how much credibility to give any source. But in statistics there is the opportunity to be explicit about those judgements, and then go where the numbers take us.

This type of insight is a fundamental tool, in an increasingly complex world, if we want to make informed decisions. The alternative is to just place trust in the conclusions of “experts”, of which there seem to be an ever-increasing number quoted on TV or in newspapers.

I’ll leave the conclusion to one of Nate’s commenters, who explains it better than I do:

Rather than cheer for Nate because we all like his Obama forecasts, how about cheering for him because he might believe in a world where numbers and rational analysis are vital to how we make decisions, even in those cases where we don’t like what the numbers imply?… It’s not about hoping you will win at Vegas. It’s about understanding how the Vegas game works.

Golden Crocoduck fever grips Talk Normal

Why post this clip? Because Sunday is a very important day for Talknormalists: it’s the day on which the annual Golden Crocoduck Award is announced. This is given by Peter Hadfield, also known as potholer54, to the creationist who offers the most flagrant breach of the 9th commandment: “the one that tells you not to tell fibs” as he explains.  The award is given every year on 28 October – the feast day of St Jude Thaddeus, the Patron Saint of Lost Causes. It’s too late for you to vote; but please check out the nominees in the video above (one of whom actually tries to convince viewers that the earth must be stationary because when we jump we land in the same place), and then the rest of his channel.

In the summer of 2006 I was asked to go on the BBC News 24 (now BBC news channel) to have a middle-aged-manchat with Peter Sissons about why there was this thing called YouTube which was becoming really popular with da kidz.  Why, he asked me, would people want to go to a web site to watch a fireman in a tumble dryer?  - he really did ask this – especially when there’s real TV on 24 hours a day, with politicians and experts standing outside buildings and stuff (he didn’t say this. I deduced it from the height of his eyebrows when he was watching the fireman video).

Get with it daddio! I sort of said – I was living in Hoxton, on the doorstep of London’s famous Silicon Roundabout, and we all spoke like that, even those of us who were old enough to know better – da peeps need to express themselves! This is the social media equivalent of the “everyone’s got a book in them” argument. It says that everyone has got a YouTube video inside them, waiting to get out: just maybe not a very good one.

So six years later I’m all for YouTube in principle, it’s just that much of it is total crap. I’m not talking about bands I don’t like or people I disagree with. There’s a ton of that on TV too. But watching the peeps express themselves on subjects such as why the earth is the centre of the universe, or how we know dinosaurs lived on earth alongside humans, can be quite disheartening. There’s eight years of material uploaded to YouTube every day. Much of it, it appears, is uploaded by people who were asleep in science lessons, aren’t really interested in looking up the answers, but still think we need to hear their half-formed ideas. Alternatively, they simply repost something by someone they decided to agree with, without stopping to think why they might learn something by checking whether it’s true.

Sometimes it’s hard to tell which bits are the worst, but luckily we have potholer54 to help us decide. If you have any interest in using logic and curiosity as a way to debunk pseudoscience, creationism and the denial of our role in global warming, he’s an excellent guide.

His videos are short (usually between 10 and 15 minutes), expertly researched with all sources listed, and very, very funny. It’s a great way to learn if ever you want to explain why there isn’t evidence for a global flood, or why Lord Christopher Monckton, the UK’s embarrassing denier of man-made climate change, is misinformed and wrong. The Monckton takedown starts here and ends (for now) here.

It’s hard to pick a favourite from his channel, but I always enjoy Hadfield’s demolition of American talk show host Bill O’Reilly:

Unlike most of his fellow ignoramuses on YouTube, O’Reilly is “paid to broadcast his ignorance to millions of people” (Hadfield’s description) via Sissons-era TV. This is one of the best arguments in favour of YouTube: without it we’d have a lot less potholer54, but the same amount of Bill O’Reilly.

The rich: better than you, but in a nice way

Too many low-value people

I dislike the idea that some of us are “high value” people if that value is based on wealth alone. Yesterday I read that “high value” people may be allowed to pass through UK airports more quickly, because it is somehow wrong that they should stand in a big queue with the rest of us.

It’s a fundamental assumption (though clearly an optimistic one) that society gives all of us the same value, except in specific situations, which means there are expectations which we all share. The social concept of “value” is based in expertise and helpfulness. Doctors and nurses can point to a qualification, and they can show a consistent record of successful intervention when they are needed. Similarly, entrepreneurs may help us by investing in the economy, which would be handy right now. But we share a common set of values. Doctors can’t be racists. An entrepreneur can’t prise the last pint of milk out of my fingers in the queue at the supermarket, or take the last seat on the bus, not even Sir James Dyson. Maybe him, on reflection.

Back to the airport: I’d prefer a country where passports get checked in the order we arrive at the desk.

The offensive idea to fast-track those of us with high value isn’t designed to get firemen and nurses through passport control more quickly. It is clearly a case where “high value” is a feelgood alternative for “rich”. In practice, the “value” which the Borders Agency wants to give us will not be social value. Here’s the Guardian reporting Brian Moore, the departing head of the UK Border Force, describing the plans to define a super-race of people who might get their passports checked before the rest of us:

Moore said it would cover people who were “valuable to the economy and were valued by the airlines”. He said the move was intended to demonstrate that Britain was “open for business”.

Note the sneaky little transition: for the “valuable to the economy” bit, the government would have to tell us all whether we are useful to it or not, which isn’t going to happen for electoral reasons I don’t need to explain. In which case only the second description, “valued by the airlines”, matters. It becomes a frequent-flier perk for business class. The Borders Agency would be moonlighting for the British Airways Executive Club.

So the class system is being disguised as social opportunity. In reality, the government would not know if the members of this commercially-designated super race are of any value at all to the UK economy. But they would get preferential treatment because they’re defined as “high value” by a commercial entity, and the whole thing is given the “open for business” label so we don’t realise that it is basically a regressive perk for the wealthy.

Similar logic applies to the fashionable generic description of rich people as “wealth creators”. I thought that the people who created wealth were the workers, who are paid less than the value of their labour. That profit may improve their lives through more jobs and higher wages, or might be hidden in the Cayman Islands. All we can say with certainty is that the rich are “wealth possessors”. The economic mumbo-jumbo that describes them as “wealth creators” is there to distract us.

Calling someone a wealth possessor doesn’t make us happy though, which is why the phrase wealth creator is becoming more common now that inequality is at its worst since 1940. It’s the sound of the privileged speaking well of themselves, in case the rest of us get all upset and start asking questions about offshore tax havens and equality of opportunity:

Note also that the UK leads the world in using this term. More than half of the English-language articles describing people as “wealth creators” are published in the UK. In the US, the slightly more defendable (though no more economically justifiable) “job creators” is preferred for this elite social class.

We can’t seem to shake off the idea that wealthy people deserve respect for what they are, not what they do. If these mysterious “high value” people can demonstrate that they have been selected because their wealth works for our benefit, not just theirs, maybe they can push in front of me at the supermarket and take my milk. That is, assuming the government doesn’t give them their own line at the till first.

For one day only

The budget cuts in local radio were starting to bite

6pm update: here’s a link to my interview on Ireland’s Newstalk. It starts about 35 minutes into this stream, but I thoroughly recommend the 10 minutes that precede my segment too: it’s an interview with the inventor of a special bag that you pee into when you can’t find a toilet. It was easily the most amusing discussion of urine that I’ve listened to before the watershed.

Today (Friday), any of you who are pretending to work from home might get the bonus of Talk Normal on your radio. That really is me! Or, if you’ve come here because you just heard me on the radio, that really was me!

Or, indeed, if you’re planning your Friday and are wondering what to do until happy hour, then residents of Coventry & Warwickshire, Leeds, Cumbria, Belfast, Antrim, Omagh, Kent, Stockport (and Congleton) and Norfolk (and some more) should tune in to local radio. During the day I’ll be chatting to all of you about a survey of jargon.

Here’s an article in the Mail online about the jargon survey. I’m quoted near the bottom. My quote about communicating in a way that people could understand was, when I checked, next to the headline “Precocious Honey Boo Boo stumbles over Spanish… and bursts into tears as ‘pageant good luck charm’ pet pig Glitzy is sent back”, which I can only assume was written by a duck pointing its bill at random words in an old copy of Hello!.

This is, of course, also how new copies of Hello! are written. It takes a lot of ducks but, crucially, not many journalists.

For first-time Talknormalists: now you’re here, have a look around. Find out my views about penguins on conference calls or discover my intimate connection to Katie Price’s breasts. Residents of South Ribble, I know your secrets. Then, most important, buy the Talk Normal book. There’s secret stuff in there that I never talk about on the radio.

 


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