I just want to quickly link to this article in the St. Louis Post-Dispatch, by Bob Rybarczyk, that discusses our society’s obsession with safety. The amazing thing about the obsession, as the author discusses, is how it seems to have come about so quickly, yet so completely. Things we did as kids — and by “kids,” I mean just during the 1980s — like riding bikes without helmets, or cramming into the station wagon without seat belts were so completely normal, yet 20 years later they could get a parent indicted. I feel that our society has gone way too far with this obsession — both legally, with laws mandating safety requirements like bike helmets, and just on our own, as the author discusses with his own worrying about his kids if they travel out of the immediate neighborhood. I am not criticizing the author; I will certainly be the same way with my toddler as he gets older.

I am generally not one to blame the media, but the enormous coverage given to crimes against kids, such as kidnappings, feeds into people’s worries and puts normal parental concerns about such crimes way out of whack. A simple look at crime stats tells you that your kid can ride a bike outside of your view for a few hours and is not going to be kidnapped, but numbers don’t really matter much when it comes to people’s children.

Most journalists aren’t number people. If they were, they’d be much less likely to wind up in a profession dominated by words. We’re trying to ameliorate the situation, at least a little, by cosponsoring CARR training sessions here in Missouri with the Heritage Foundation, the Sunlight Foundation, and the Missouri Broadcasters Association. These sessions help to give journalists some basic grounding in computer-aided statistical reporting.

A recent article in The Washington Missourian about property tax assessments (I found the link via John Combest’s always useful page) highlights the need for journalists to check, doublecheck, and triplecheck their numbers — and always get another pair of math-savvy eyes to inspect their work:

Kim and Steve Obenauer were shocked last week when they found out their real estate tax bill has increased by nearly 87 percent this year. [...]

The tax bill for the lot with the mobile home was $79.08 in 2006. This year’s tax bill for the property is $605.41.

Wait a second, I thought — wouldn’t that be an increase of more like 600 to 700 percent? I called up Windows’ trusty calculator, and found that, indeed, moving up from $79.08 to $605.41 constitutes an increase of 665.57 percent. Why such a large discrepancy between the actual figure and the reported figure, I wondered? I figured it was probably just a typo, and moved on. Then I found this sentence:

One woman’s tax bill increased 61 percent, from $390.63 in 2006 to $1,009.10 this year, Emmons said.

But that would be an increase of well over 100 percent! Sure enough, a quick trip to the calculator revealed an increase of 158.33 percent. That’s when I realized what the Missourian piece was doing wrong — it was taking a backward look at the numbers, as though the new tax figures were starting points.

Take the first set of numbers, $79.08 and $605.41. If a homeowner were assesed $605.41 one year and $79.08 the next, that would constitute a decrease of 86.94 percent — or, rounded up, 87 percent. The problem is, that same figure doesn’t apply in reverse. Percentage changes are relative, depending on which number is the starting point, so even though $79.08 is only 13.06 percent of $605.41, calculating the reverse shows that $605.41 is 765.57 percent of $79.08 — or, after subtracting the original 100 percent, an increase of 665.57 percent more than the original $79.08.

The same is true of the second set of numbers. Moving from $1,009.10 one year to $390.63 the next would be a decrease of 61.29 percent, but the reverse, moving up from $390.63 to $1,009.10, is an increase of 158.33 percent. In other words, if you take the difference between the lower figure and the higher — that difference being $618.47 — you can fit $390.63 into it 1.5833 times, which is where we get the 158.33-percent-increase figure. If you take that same difference and try to fit $1,009.10 into it, you’ll find that it fits 0.6128 times, which is where we get the 61.28-percent-decrease figure.

I don’t write this as an unfriendly challenge to anybody at the Missourian. Rather, I simply hope it illustrates that, as Judge J. Smith Henly wrote, "Statistics are elusive things at best," and nudges Missouri journalists toward using a little more care when working with figures.

In addition to David Stokes’ criticisms of the otherwise excellent West End Word piece about Rex Sinquefield and the Show-Me Institute, I have a quibble of my own. Toward the end of the article is this paragraph:

The ideological bent of the Show-Me Institute can be found in its 2006 annual report in unintended ways. Among the institute’s many achievements, it touts a “groundbreaking look at how to end the earnings taxes in St. Louis and Kansas City”; it makes no mention of a follow-up study (which came out in January 2007) about a land tax, economist Joseph Haslag’s recommended way of plugging the $130 million-a-year hole in the city’s budget. Sinquefield called this “an oversight.”

Now, because I edited our annual report, I might feel too protective of it. But this was no oversight. We didn’t mention Haslag’s January 2007 study in our 2006 annual report because it was released in 2007 — not 2006. As with most other organizations that issue annual reports, we restricted its focus to the things we accomplished in the year that the report covers. I myself am mentioned nowhere in the 2006 annual report, even though a large portion of it is my own work — because I wasn’t a Show-Me Institute employee in 2006.

We did make one exception to this general rule, for the inside page of the back cover, in a section titled "Going Forward". We decided that a one-page summary of where we’ve been since 2006 would be appropriate, especially because we issued the annual report so late in the year (waiting for a thorough audit to be completed). That might have been a good place for a more specific mention of Haslag’s January 2007 study, but really, that section was all about broad strokes and didn’t get into many details.

So we didn’t exclude the land tax study from our 2006 annual report because of an ideological bias or an oversight. I think it’s an excellent piece of scholarship, and I’d have happily included it if it had been published just a month sooner.

Tim Woodcock of the West End Word (link via Missouri Political News Service) wrote a very thorough and detailed article about Rex Sinquefield and the Show-Me Institute (which are two separate things, although I know some of you refuse to believe that) in this week’s edition. I recommend the article highly, but I do wish to address some of the comments made by others, as quoted by Mr. Woodcock. 

The essential problem is that Tim uses political scientists to offer comments on issues and studies that are essentially economic in nature, and — as might be expected — they have little idea of what they are talking about. The first absurd statement in the article comes from Dr. Ken Warren of SLU (emphasis added):

More worrying is the fact that some of the facts Sinquefield used at the time to support his arguments were plain wrong. For example, Sinquefield insisted that Missouri’s state income tax is among the highest in the country. Warren said after the meeting he went away to check what Sinquefield was saying and, although the rankings can vary from year to year, Missouri’s position was always among the bottom 10.

Really, Dr. Warren? Because nine states don’t even have an income tax, so that pretty much fills out your bottom 10 right there. As this story is relayed, Rex made a comment to Dr. Warren about the state income tax, and Dr. Warren says our facts are wrong and then refutes it with statistics about general state taxation. It is true that Missouri has very low sin taxes and gas taxes, much of Missouri has low property taxes (elected assesors — that’s another issue), and sales taxes are about average for the nation. A report by the Tax Foundation ranks Missouri as #34 in total state and local tax burden, and I have seen other reports with very similar rankings.

But Rex didn’t tell Dr. Warren we had a high overall tax rate, just a high income tax rate, which is true. And if income (and earnings) taxes are more distortionary than other kinds of taxes, as they are, then this is a problem — and perhaps the income tax should be lowered, or eliminated, as SMI has proposed, and taxes that are less distortionary should be raised as substitute revenue sources, as SMI has also proposed.

Twenty states have a higher top rate for their state income taxes than Missouri, and three others have the same top rate. Here is the list from the Federation of Tax Administrators. However, Missouri’s top rate kicks in at a much lower level than almost all other states. Only three states with equal or higher state income taxes have a lower income threshold for the top bracket. Furthermore, only six states with equal or higher income taxes have a lower personal exemption for individuals (among those that offer deductibles rather than credits), and only three have a lower exemption for children. This combination of a higher-than-average state tax rate (we have not even included in this equation the local earnings taxes that many Missourians pay), very low income levels to qualify for the top bracket (only $9,000), and low deductions for individuals and children, results in a high state income tax burden for Missourians. 

To illustrate this, if one lives in Missouri and earns a taxable income of $20,000 (after standard deductions), they pay $975. If that same person lived in Ohio, a state with a higher top tax bracket, and earned the same income, they would pay just $409. People vote with their feet, as is often said, and particularly in a state whose two largest cities border other states. If Dr. Warren can’t understand all this, that is not our fault.

The second off-kilter statement is from Dave Drebes of the Arch City Chronicle, who I know and like and have tempered my comments here accordingly. Dave lives and breathes politics, so it is no surprise he would downplay economic factors in general. Here is his comment about our studies on local earnings taxes (emphasis added):

[...] Drebes said many of the Show-Me Institute’s studies are simplistic, often applying pat theoretical models from the world of economics to fiendishly complex real-world problems. A study on the earnings tax shows a statistical correlation between the post-war decline of Kansas City and St. Louis, and noted that both cities introduced earnings taxes in the 1950s. But it is fallacious to believe that the tax caused or even contributed to the decline because there are so many other factors, Drebes said.

If the study is simplistic (it isn’t), then it should not be hard to refute it with more substance than simply calling it "simplistic" and saying there were other factors at work. Dr. Haslag, who wrote the earnings tax studies, has never stated the earnings tax was the only factor involved in the decline of the central cities. Of course many factors were at work. But for Drebes to deny that an earnings tax "even contributed" to the decline of the cities is crazy. So St. Louis could have a local earnings tax of 80 percent and it would make no difference? That is pretty much Drebes’ logic. Dr. Haslag released a very thorough study on the harm local earnings taxes do to cities, and people who disagree with it need to do a lot more than merely insult it to prove it wrong.

All in all, though, it’s a very good article and I hope you check it out, as well as checking out everything we have to offer at our main website.

Along with David Stokes, I had the pleasure of attending two all-day sessions training Missouri broadcasters how to use the techniques of Computer-Aided Research and Reporting, first on Friday at UMKC and, the following day, at UMSL. This is a program started about eight years ago by a couple of folks at the Heritage Foundation — Bill Beach, director of Heritage’s Center for Data Analysis, and Mark Tapscott, formerly director of Heritage’s Center for Media and Public Policy, and now editorial page editor of the Washington Examiner. They were joined at our sessions by Greg Elin, chief data architect for the Sunlight Foundation, and Robert Bluey, who now holds Mark Tapscott’s old position at Heritage. In fact, Robert currently has a couple of entries on his blog about their Missouri trip.

The Show-Me Institute sent me to DC in July to take a look at one of Heritage’s CARR seminars, and decide whether the program was worth bringing to Missouri. Not only is the program incredibly valuable — for younger newcomers to journalism and old hands alike — but in a way, bringing this program to Missouri is like bringing it home. The textbook given out during the training sessions was written by none other than Brant Houston of the University of Missouri-Columbia.

One of the primary benefits of a program like this is that it shows essential skills can be taught in a non-ideological environment, even if the teachers have their own political points of view. Folks at the Show-Me Institute, the Heritage Foundation, and the Sunlight Foundation — in addition to all the attending reporters and editors — would all undoubtedly find many things to disagree about (and did, as evidenced by our lunch and dinner conversations). But the material presented in the training sessions was entirely informational — about how to use computers in researching articles, checking claims of fact, analyzing the use and misuse of statistics, and learning about all the new and varied ways Internet technology allows information to be gathered and used in ways unimaginable only a few years earlier.

These events wouldn’t have been possible without the generous support and organizational efforts of Don Hicks of the Missouri Broadcasters Association. We owe him a huge debt of gratitude.