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Saturday, October 11, 2014

Moving The Goalposts

The term “moving the goalposts” is a metaphor for something that is changed while in progress. It originated in Britain but is frequently used in the United States when the rules of the game or measurement metrics are changed.

I first became aware of it as a young adult reading claims of the East German government for industrial output (yes, I led a wildly exciting youth). They were so ridiculous that I knew that someone was cooking the books.

In the United States, they move so gradually that you have to watch carefully or you will miss them or dismiss them. It first hit me in the early1980’s when Social Security increases were adjusted to reflect a “more realistic” cost of living for recipients. They took mortgage interest rates out of the calculation saying that few recipients were in the market for a mortgage. On hearing, I nodded and moved on.

Then, coming off the terrible 1982 recession, the Reagan administration suddenly blended the 1.5 million Army, Navy, Air Force, and Marine personnel on active duty with the civilian work force. Presto! The unemployment rate fell--some say by as much as two percent.

A decade later, the Clinton administration upped the ante big time. The moved goalpost was also unemployment figures. If you were so discouraged that you gave up looking for work, you were no longer counted as unemployed. If you wanted full time work but could only work part time, you were not in the unemployment figure. And, full time work was now 21 hours per week even though benefits had to be paid at 30 hours per week.

The Core Consumer Price Index no longer includes food or energy costs. Actually, it has not for years. What? Nope. Food and energy price swings are considered too volatile and short term. Recently (2012), the Core CPI has been replaced and even a stat geek like me is having a hard time sorting out the new formula.

So, are our government statisticians a bunch of liars? No. I am sure the staffers are very careful about the calculations. Are they forced to manipulate statistics and data by policymakers? Yes! When the criteria change, the formulae change.

It is hard to tell whether the economy is really improving when “the goalposts are moved.”  Interestingly, people on both sides of the political and economic spectrum share their annoyance with governmental adjustments. Jim Sinclair, a “gloom & doomer” and passionate gold bug and Chris Hedges, a strident left wing journalist, both swear by John Williams’ Shadowstats. Williams once had a job analyzing government statistics and decided to publish his own as the “official” numbers in his view were so divorced from reality.

Critics say this cozy arrangement has lots of benefits. The government pays less in pension adjustments and social security and private companies can pay less in wages by claiming that the cost of living has hardly budged. Our Social Security time bomb has a slightly longer fuse and business can drop more to the bottom line by citing government cost of living stats at raise time.

While preparing this, a panel member suggested that a similar scam is going on with the Nielsen +7 audience measurement (actual viewing plus playbacks for the next week). I thought that was a bit unkind as a broadcaster or cable entity has the right to charge for their entire audience. He countered that most of the people playing back a program days later would edit out the commercials as they went along. He also said that prices were driven not by audience size but supply and demand so the Nielsen +7 was another example of a “moving a goalpost.”  His point was certainly well made.

Mark Twain once said that, “There are lies, damned lies, and statistics.”  The great humorist was on to something.

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com

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