Editor’s note: Morton J. Marcus’ Eye on the Pie column runs each week on Business Weekly’s opinion page.
ANGOLA — Who knew that statistics and data could be entertaining, maybe even make a crowd of people laugh while thinking about what the numbers really mean?
That’s exactly what Morton J. Marcus showed a room full of Trine University students and community members Nov. 13 during an hour-plus long presentation.
In addition to being an economist, Marcus writes a weekly newspaper column, “Eye on the Pie,” that appears in newspapers across the Midwest.
He also taught economics at Indiana University for 33 years, served as director for the Indiana Business Research Center in the Kelley School of Business at IU, has been involved in local and state economic development since 1970 and has served nine Indiana governors as an adviser on taxation and economic development.
“You listen on the radio that the Dow Jones industrial average today rose by 2.1% and that’s probably accurate,” he said. “But why?”
The stock market goes up and down based on the information that comes in that day to a bunch of people who are masters of business administration of fine institutions, including students of his at IU, he said, but he wouldn’t trust them with his money.
“We don’t know what’s going on with the American economy,” he said. “Because all of the information we have is yesterday’s information and people want to know what’s going on today.”
For many cases, Marcus said, data is used just for amusement. That goes for the Dow, too. He said for many even that is just amusement.
“We have a lot of information that’s irrelevant to everyone but the specialists,” he said. “I look at a lot of data about Indiana’s economy and it makes me very sad.”
Indiana is not doing well, he said, and hasn’t been for a long time yet state leadership, particularly the governor’s office, are in the business of telling people how good things are without knowing what the data really shows.
And that’s not just the current governor’s office. He said that has applied to each office he’s worked with or known.
To explain a bit about data and how numbers aren’t always what they appear, he used the worst number in America; the divorce rate.
“Numbers are basically representations, in this case, of human behavior,” Marcus said. “When we talk about retail sales, we talk about human behavior.”
He provided the worst number in American life that he’s discovered in his 50-plus years in statistics; the American divorce rate is 50%.
Data comes expressed as percentages, he said, but it’s ultimately fractions with the numerator, in this case, being the number of divorces divided by the number of marriages in a given year.
“That’s how we get the divorce rate,” he said. “But that’s what I call a Paul Harvey number … that’s wrong.”
He continued, saying that’s not the divorce rate yet though it is widely published as anywhere from 48%-52%.
The number of divorces in a given year divided by the number of couples in a state of matrimony that year, not the couples getting married in that year, is the actual number.
The divorce rate is closer to 2%-3%, he said, but the numbers out there are the ones eaten up and would have people believing that America is falling apart.
Switching to talk about Angola, he said there is “all kinds” of data about Angola.
He picked on Mayor Richard Hickman a bit, who was in the audience, saying Hickman has to focus on making Angola what people want it to be, what some people don’t want it to be, that kind of thing.
“Workforce development is big in the state of Indiana,” he said. “We have to think about Angola’s workforce.”
However, should the mayor be the one thinking about the workforce or the business people hiring the workers? Marcus said it is a question of who has responsibility in respect to Angola’s workforce.
“Angola’s workforce aren’t necessarily people coming from Angola,” he said. “They might be people coming from outside Angola, from foreign territory, people coming from Ohio.”
Likewise, consumers of goods in Angola don’t necessarily come from Angola.
“We saddle Angola with the numbers that really belong to a much longer unit,” Marcus said.
Most people that want to use the numbers given in a data set aren’t really interested in the truth, if you ask Marcus.
As he presented it, the most startling fact about Angola is also the least important.
“Angola has the highest ratio of doughnut shops to population in the state of Indiana,” he said. “Of 23 cities in Indiana, Angola ranks at the top.”
A chart he showed in a PowerPoint lists Steuben County’s population at 34,372 and notes there are 11.46 doughnut shops per 100,000 people of population. Other cities listed included Fort Wayne, Auburn, Wabash and Warsaw.
Steuben County, he said, is growing at a little over half the rate of the state as a whole in terms of population.
This is a county, he continued, that has shown very little growth over a 10-year period.
The median average age in Steuben County is 43.7 years, which means half the people in the county are older and half younger.
“When you’ve got an older population, what you have is a wonderful population of people like those in the front rows that are staying up late tonight just to be here,” he said.
In Steuben County, 20% of the population is over age 65.
“What we’ve got here is a very small number of young adults age 25-44,” Marcus said. “Twenty-five to 44 is when people have children, move into a house, buy a washing machine, buy a dryer, buy a refrigerator and also some other things. They are the big spenders in our society.”
Using 2017 data, Marcus said median monthly rent in Steuben County is relatively high for the state, ranking 29th with a dollar amount of $547.
There were 19,779 dwelling units in the county, including vacant units, which accounted for 30% of that number.
“Vacancy isn’t a bad thing,” Marcus said.
Vacancy numbers in Steuben County, he said, could be from the lake homes that don’t have people living there full time. But, should people coming to the county ask, others should know how to explain the information surrounding the numbers.
“Data do not stand alone,” he said. “Data are there to help answer policy questions.”
Politicians at the state level, said Marcus, will say how well the state is doing, but it’s not growing close to the national level.
Using Angola as an example, starting in 1900, he said it took this area until 1970 to have a population that had grown over where it was in 1900.
The chart he used had an index number, set at 100, with everything following from there.
“What you can see is that in the early parts of the 20th century, from 1900-1940, the population of Steuben County and of Steuben when you take out Angola was actually declining,” he said. “It began to climb again and got over 100% only by 1970.”
Seasonal adjustment, he said, is made up numbers done by statisticians and behind them mathematicians.
“These are terrible people that take truth and destroy it by giving us seasonally adjusted numbers,” he said.
The reason for seasonal adjustment is to find some element of truth in reality because truth and reality may also be different.
When talking wages in the United States, he showed charts that indicate the average wage is rising.
“But the median wage is not,” he said. “We don’t talk about median income but the median has been falling.”
But, Marcus said, he feels the median numbers, which often aren’t published, are closer to the truth.