links for 2007-12-11
Dean Baker Is Remarkably Calm and Measured, Considering...

Wow. As If We Needed Yet Another Reason Not to Read the Washington Post

Post fact-checker Michael Dobbs demonstrates that he has no clue what a fact-checker is or does:

The Fact Checker Fact Checks The Post - Fact Checker: I have spoken with the principal author of the [Post] editorial, but I am not going to identify that person.... The editorial writer got the information... from a Mexican embassy slide show... by Antonio Ortiz-Mena, a well-known Mexican economist. Slide Six shows an increase in Mexican Gross Domestic Product from $200 billion dollars in 1987 to $875 billion (estimated) in 2007.

The slide does not provide... information about the source of the data... does not say whether the dollars are current or constant.... [T]he data tables of the International Monetary Fund... show that the Mexican economy grew from $148 billion in 1987 to $886 billion in 2007.... If you adjusted these figures for inflation, you might get a result similar to the figures used by The Post.

UPDATE: Actually, as a couple of readers have pointed out, this seems a stretch... the [Mexican] cost of living has increased 79 percent... $148 billion [measured] in 1987[-value dollars] is the equivalent of $265 billion [measured] in 2007[-value dollars, not $200 billion]....

It turns out there are several other ways of looking at the same statistics.... IMF peso figures, adjusted for inflation... works out at a growth rate of around 83 per cent....

To help me adjudicate this dispute, I turned to Paul Blustein, a former international economics reporter for the Post, now with the Brookings Institution, where he is writing a book about international trade. He said he was "sorry to go against my old alma mater," but he came down on the side of the critics. His explanation:

Constant dollars can be a good way of looking at a country's economy, but when there have been huge moves in that country's currency against the dollar, it is better to rely on the local currency. This would have raised a red flag with me. I don't think any economy in the world has quadrupled in twenty years. That would be an amazingly fast rate of growth. I doubt that even the Chinese economy has done that....

[T]he IMF... suggested a third way... PPP... the purchasing power of the average Mexican has risen by around 125 per cent between 1987 and 2007.

So take your pick. Depending on the statistics you use, Mexican economic growth over the last two decades has been either 337 percent, 125 percent, or 83 percent.... This is a case study of how statistics can be used to support virtually any argument....

[T]he Post editorial board should have been much clearer about the source of the statistics, and explain why dollars are the appropriate measure for the growth of a peso-based economy. The claim of a quadrupling in the size of the Mexican economy over two decades is misleading, and should have raised some eyebrows. Two Pinocchios for the Post.

The critics were also sloppy in their use of statistics, but at least they pointed out the source. One Pinocchio for them.

Why oh why can't we have a better press corps?

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