The Dogma Behind the Pay Wall

The New York Times' Paul Krugman and David Brooks cherry pick statistics while reducing a complicated economic issue to platitudes and politicking.

Columnists Paul Krugman and David Brooks went head to head last week on the New York Times op-ed page, presenting their respectively grim and complacent assessments of economic inequality. Meanwhile, in its September issue, the Atlantic contributes a detailed and illuminating essay on the failure of wages to rise alongside the increase in productivity.

To read these three efforts in succession is to be inflicted with cognitive dissonance. Brooks, the conservative, argues that social mobility is intact and that wages for members of the lower and middle class are more or less stable. He further maintains that the income inequality that does exist is the result of poor education and skills.

Publishing a day later, the liberal Krugman attacks Brooks’ assertion that education is associated with higher incomes, noting that “once you adjust for inflation, you find that the income of a typical household headed by a college graduate was lower in 2005 than in 2000.” Brooks ruminates on that for 48 hours, and then fires back with a second column in which he insists that higher education does mitigate wage stagnation. The problem, he explains, is that too few kids go to college because so many of them are born to parents with bad marriages, high taxes, and “disorganized homes.”

These columns didn’t increase our understanding of income inequality, but they did remind us how easy it is to reduce a complicated economic issue to platitudes and politicking. Particularly egregious is the tendency of certain columnists to manipulate statistics to their own ends.

Fortunately, we have Clive Crook, a rare journalist who not only writes engagingly about the economy, but also understands the differences between facts, well-argued opinions, and shameless partisanship. In his Atlantic piece, he borrows Dutch economist Jan Penn’s metaphor of a parade, with people filing past in order of their income levels, and their incomes corresponding directly to their physical height, to demonstrate income inequality. Asking us to imagine that we, the observers, are of average stature, Crook writes that by halfway through the parade, “the observers might expect to be looking people in the eye — people of average height ought to be in the middle. But no, the marchers are still quite small, these experienced tradespeople, skilled industrial workers, trained office staff, and so on — not yet five feet tall, many of them. On and on they come. It takes about forty-five minutes — the parade is drawing to a close — before the marchers are as tall as the observers.” When people in the top 10 percentile arrive, Crook notes, “things get weird again. Heights begin to surge upward at a madly accelerating rate. Doctors, lawyers, and senior civil servants twenty feet tall speed by. Moments later, successful corporate executives, bankers, stock_brokers — peering down from fifty feet, 100 feet, 500 feet. In the last few seconds you glimpse pop stars, movie stars, the most successful entrepreneurs. You can see only up to their knees…At the very end of the parade…is John Paul Getty, heir to the Getty Oil fortune. The sole of his shoe is hundreds of feet thick.”

The hard numbers are equally dramatic. Crook cites a study by two professors at Northwestern University who found that in the last 30 years, the salary income of workers in the 99.99th percentile increased by an incredible 617 percent (the income of the 99th and 99.9th percentiles increased by 58 percent and 236 percent, respectively). During the same period, median income increased only 11 percent.

It doesn’t take a rock-hurling lefty to see the difference between Crook’s nuanced, yet straight-forward analysis, and the sneaky simplifications of your average columnist with an agenda. Brooks, for one, attempts to debunk what he calls the “populist” argument that “the haves exercise more power over the have-nots [and] as a result, corporate profits soar, while wages stagnate,” by dropping a single statistic that is neither contextualized nor even accurate. He writes, “…workers overall are not getting a smaller slice of the pie. Wages and benefits have made up roughly the same share of the G.D.P. for 50 years.”

First, this number represents the aggregate wages of all workers and therefore does not account for the top-heavy distribution that the Northwestern professors found in their study. And second, as an August 28 Times article noted, wages and salaries made up nearly five percent less of the GDP in the first quarter of 2006 than in 2001, rendering Brooks’ contention that they have “made up roughly the same share of the GDP for 50 years” patently false.

But what are facts and intellectual honesty when you can tug reader heartstrings with doleful rhetoric about obvious, but utterly immaterial problems like broken families?

Brooks got himself into more trouble when he cited the work of Harvard economist Lawrence Katz in support of his assertion that “the meritocracy is working almost too well” by “rewarding people based on individual talents.” Ezra Klein of the American Prospect asked Katz what he thought of Brooks deploying his theories to the political battlefield.

“There are,” Katz told Klein, “clear market forces that have to do with the demand for talented individuals, but the current period is not that different from the past for that type of thing. In the past, however, we’ve done a very good job expanding access to education to keep up with growth, providing bargaining power to those left behind, and using government policy to help them. What’s changed in the last twenty years is that we’ve eroded those ameliorating institutions.”

Katz also said that he didn’t “have anything to do with the ‘spin’” Brooks put on his ideas. He even expressed support for the “populist” solutions — unions, higher taxes for the wealthy, wage subsidies — that Brooks deplores.

The left-wing Krugman, while not as flagrant as Brooks, coats his column with a similar sort of partisan slipperiness. While he criticizes “conservative commentators [who] tell us about wage gains for one-eyed bearded men with 2.5 years of college of whatever — and conveniently forget to adjust for inflation” he chooses somewhat specific data himself, suggesting that there has been a decrease between 2000 and 2005 of incomes for a “typical household headed by a college graduate.” Krugman doesn’t tell us where he got this statistic, and he fails to define “typical,” so we are left to guess who exactly these desperate college graduates might be.

Columnists are, by definition, in the business of presenting opinions, and they must do so with limited amounts of space. But they do their readers a disservice when they make broad generalizations and cherry pick numbers to support their political perspectives. When tackling an issue as complex and statistically rich as income inequality, op-ed writers ought to be held to the same standards of accuracy as their front-page counterparts.

If that seems too much to ask, run for office.

In our original post, we said that Krugman’s statistic was not “widely published.” We had looked for the statistic in the Detailed Income Tabulations section of the Census Bureau website. It is not listed there but is in fact listed in the Historical Income Data section. We regret the error, and the text has been corrected.

Update, 01/30/12: This article was originally credited to Bree Nordenson.

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CJR Staff is a contributor to CJR.