Courtney: What statistics best show the economy’s health?

No matter where you fall politically, you have stats to prove the economy is doing well or poorly.

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by Zach Courtney

Last week, the Golden State Warriors won the 2022 NBA Finals in six games, clinching it with a 103-90 victory over the Boston Celtics at TD Garden.

No one disputes this. After all, the Warriors scored more points than the Celtics in four of the six games. Sounds pretty simple and straightforward, right?

Why can’t politics be this easy? Why can’t we, as voters, agree on a set of statistics that matter most to determine which party is doing better and is more worthy of our votes?

Our current system is like if some teams in the NBA used rebounds to determine the winner, while other teams used assists. While they both have indications of how well their team is playing and who is going to win, the real way to see what team won is by looking at which team scored more points.

When I set out to write this column, I was searching for what would be analogous to points (the best metric to declare who played best), and rebounds and assists (what both major parties use to declare who played best). Here’s what I came up with.

The GOP’s Version of Rebounds

Rebounds are often a good indicator of which team will win in a basketball game; more rebounds means more possessions, and more possessions means more shots. That said, this isn’t always the case. Sometimes a team can win by 15 points despite getting outrebounded, as they gain a possession advantage in other ways, like creating turnovers.

Republicans’ economic equivalents to rebounds are gas prices and inflation. They’re certainly important, but only in some ways, and never without context.

Gas prices and inflation certainly fall in this category. They’re important — no one is arguing that paying $5 per gallon of gas or 8% annualized inflation is good — but context is necessary.

The context is that high inflation and gas prices exist in all parts of the world today. This shows that inflation isn’t simply a result of the Fed’s low interest rates or deficit spending by Congress, but that much of it is due to issues with the supply chain as a result of the ongoing pandemic. It shows that gas prices aren’t the fault of President Joe Biden, but a result of the war in Ukraine and OPEC’s unwillingness to pump more oil.

The Democratic Party’s Version of Assists

Likewise, some in the world of basketball like looking at assists as a key indicator of how a team is playing. After all, a team that has a lot of assists is clearly playing good team basketball and making the right passes, making them more likely to win.

The Democrats’ economic equivalent to assists is headlining unemployment. Sure, we want more people working, but does the unemployment rate really tell the full story about how workers are doing in this country?

The answer to this question is no.

If we want to know how many people are working, the best statistic is the labor-force participation rate, which is the percentage of Americans at least 16 years old that are working. For example, Minnesota’s unemployment rate sits at about 2% today, but the state’s labor-force participation rate is at 68% — two percentage points lower than it was before the pandemic and seven percentage points lower than it was in the mid-1990s. The labor-force participation rate shows that fewer people are working in Minnesota today, so the record-low unemployment rate is quite misleading without context.

And even that doesn’t show how workers are doing. In reality, real wages — which account for inflation — have been largely stagnant over the last 50 years.

Poor Bipartisan Statistics

There are two statistics, however, that both major political parties agree are important: Gross Domestic Product (GDP), which is a statistic showing total economic output and trends in the stock market.

They’re still bad stats that don’t do much to show how regular people are doing. The stock market should be obvious — only 58% of Americans own stock. GDP is less obvious, but still a poor stat. At this point in our development as a society, why do we care about an increase in GDP while life expectancy and mental health go down? Robert Kennedy put it best: “It measures everything in short, except that which makes life worthwhile.”

Economic Version of Points

While the two major political parties are debating whether people should care more about high inflation and gas prices or good unemployment rates, regular people — no matter what political party is in power — are being left behind.

The issue is that we aren’t even looking at the statistics that matter the most. We’re just looking at the statistics that will make our political party look the best at that moment in time. As of now, that means Democrats look at the unemployment rate, while Republicans look at gas prices and inflation. It would be bad for the two-party system if anyone brought up the statistics that make both major parties look bad, so they just avoid them entirely.

I’ll list some, but be warned, part of why we hear so little about them is because 1) they’re depressing, and 2) they show a complete bipartisan failure to help anyone besides those at the very top.

In the wealthiest country our world has ever known, we still have far too much poverty and food insecurity. Today, the United States has about 17% of its children living in poverty, and 14% of all Americans live in poverty. A pre-pandemic statistic shows that 10.7% of Americans are food insecure.

Americans, quite simply, aren’t healthy today. Life expectancy is declining. Americans have been dealing with a recent increase in depression, anxiety and suicide rates, too.

Over the last twenty years, there has been an alarming increase in drug-related overdose deaths. In 2015, there were 52,404 drug-related overdose deaths — that number skyrocketed to 91,799 in 2020.

It’s not that we can’t care about inflation, gas prices, unemployment rates, GDP or the stock market. In fact, we should care about these statistics, just like we care about rebounds and assists. They just shouldn’t be our main factor when it comes to who we vote for or how we think our economy is doing.

We should care about our mental health, drug overdose deaths and suicides, as they show many of us are stuggling; we should care about real wages, as they show how workers are doing when we factor in inflation; we should care about wealth inequality and poverty rates, as they show if we are effectively redistributing the fruits that flow to the top to ensure all are able to live lives of dignity; we should care about life expectancy, food insecurity and clean water, as these are all basic statistics that show how well a society is doing.

In short, in the world of politics, we need to quit putting rebounds and assists at the top of the scoreboard. I just want to know how many points we’re scoring.