I stumbled across this money.cnn.com article showing a drastic difference in the median net worth between the races. The author calls particular attention to the differences between whites and blacks ($110,729 vs $4,955 respectively). To put that in tangible numbers, that’s the difference between a fairly nice mid-western house and a year lease on a U-Store It unit.

The data and the presentation are intended to elicit an
emotional response. And it
succeeds. But, I’m all about separating
facts from emotion so let’s tear into what “median net worth” tells us.

The median of a set of data is a bit dodgy. Knowing the number that’s in the exact middle
doesn’t necessarily give you a picture of the entire set of data. To get the median, you put the data in order
(let’s say increasing left to right) and then find the number in the middle. Who said math was hard? What if every number to the left of the
median value is 0 (zero (nada (zilch))), the median is 4,955, and then every number to the right of
the median is a million-bajillion? The
median really wouldn’t reflect any of that information. So the median without a mode (most repeated value)
and a range (lowest and highest values) doesn’t paint a very detailed picture.

What is “net worth” really?
Consider this: My brother and I
both get a job and we both get paid a dollar a day. Every evening, he dutifully squirrels his crumpled
and sweaty dollar away in a piggy bank that he keeps buried in the back yard
and I invest mine in a combination of pizza and midget(x1) porn. At the end of the year I’ve got 0 dollars and
I’ve gone blind from all the porn (mom tried to warn me) while my brother has 350
dollars. I had to steal 15 bucks to pay
the North American Pride Association for Little Men and Women (NAPALM) for the right to use the word midget(x2). It costs $3 a pop.

What kind of information about our environment can you glean
by looking at our—grammatically awkward— individual net worths? What does my net worth say about my
neighborhood or how my employers treated me?
What does it say about my brother?
The only thing that’s for certain is my brother has some assets and I
don’t. Comparing these assets over time
could reveal some additional information about the economy—or the midget(x3)
porn industry—perhaps, but we couldn’t honestly glean any useful sociological
data that contrasts my brother’s life with mine. We could, however, investigate why I preferred
midget(x4) porn over savings and the sociological ramifications of that
decision (and perhaps someone should).

Median net worth, therefore, is a bogus foundation for an
inequality case. I found even more
fodder for this when I considered the income distribution stats from the U.S. Census. 65% of white people make over 50 thousand
dollars per year whereas only 50% of black people fall into that category. There is obviously some disparity here and
now the question of why blacks are earning less money becomes more immediately relevant
(though not necessarily indicative of racism) and we are forced to look into that
disparity. As for why this is more
meaningful than “median net worth” consider that even though Asians had a net
worth of roughly half that of whites, 70% of that population (5% higher than whites) makes 50 thousand dollars
or more per year.

Midget(x5). Money
well spent.

The median is the message

ReplyDeleteAnd as I've pointed out, that message is misleading. So what's your point?

DeleteI just can't imagine how Fifth-Stanine Sophist is getting a dollar into a piggy bank he "keeps buried" on a daily basis. I'm picturing a narrow tube and dollar-stuffing-stick. It's a good idea anyway; if you need money, you'd better have a shovel and forty-five minutes' free time.

ReplyDeleteI like this expose' of the median as a poor illustration of what the aforementioned article was trying to convey. Unfortunately, average might be worse considering all the white CEOs and black inmates to skew the results. Range would be a fruitless means since ($Bill Gates minus $0) is greater than ($Labron James minus $0). Perhaps mode is the telltale standard, but only if it's rounded to the nearest $5K or $10K, because $0.00 would be the most frequently recurring figure for both groups if rounded to the nearest cent.

I agree with you that any single measure of central tendency or any solitary stat isn’t going to paint a clear picture. I don’t think the Census was attempting to deceive in calculating and presenting this median; a number is a number.

DeleteIt’s the interpretations of those numbers that get whacky. That’s why I certainly believe the money.cnn.com article was trying to mislead. It’s a hot burning fuel to the fire for those who already think there is a problem, but once you break it down it burns a little more coolly.

As far as the money-burying-sophist-brother I’ll clue him in on the dollar-stuffing-stick. That certainly seems a little more secure than the shallow-money-pit-piggy-bank-burial plot. ~grin~

http://chzmemebase.files.wordpress.com/2012/01/internet-memes-redneck-randal-speaks-the-truth.jpg

ReplyDeleteJesus spake with a southern' twang, son.

Delete