How to measure – and vanquish – poverty? A new answer to an old problem

Sep 18, 2018 by

by Mark Wallace, Conservative Home:

How best to measure poverty has long been a vexed question in British politics. The naive hope that statistics would be able to produce an answer simultaneously accurate and robust enough to withstand the pressures of political misuse, abuse and misunderstanding has yet to be fulfilled.

In the Blair years, a story – likely apocryphal – had John Prescott raging that “we’ve been in power for five years, and half of people still earn below average”. It’s a decent joke, but it also gets at a truth about the awkwardness of statistical measures of real-world problems.

Like the three statisticians who try to hunt a deer – one shoots 10 yards too far to the left, one shoots 10 yards too far to the right, and the third punches the air and shouts “We got it!” – data doesn’t necessarily describe what is actually happening in a true, rather than technically accurate, sense. In the political bear-pit, that risks handing ammunition to those who want to overstate their own performance or understate that of their opponents – a return to the back and forth which numerical truth was meant to free us from in the first place.

The simple measure of averages, satirised in that Prezza gag, has obvious flaws. Average income could rise even as the poorest became slightly worse off if, say, the very richest person enjoyed a truly vast increase at the same time.

Hmm. Perhaps measuring inequality would provide a more truthful truth, escaping crude averages and exploring the gap between rich and poor instead? The concept appealed to some on an ideological level, and swiftly became fetishised – inequality was to blame not just for, well, inequality but for all manner of social ills. The gloss came off when the impact of the financial crisis on the richest resulted in various of these new measures showing the crash had technically improved equality. It was an accurate result on its own terms, but the idea the new system theoretically scored such a disaster as a positive thing exposed its inherent flaws.

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