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Want Crippling State Deficits? Try Electing “Smart” Legislators

July 13th, 2011 · 2 Comments · Economics

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UPDATE 8/8/2011: Craig Newmark ran all 50 states and was kind enough to send me the results. Bottom line is a flimsy correlation 0.211, which is short of statistical significance. We also get an R-squared figure of .045 which is “not too impressive.” While it ‘aint zero, I gotta come up with something better than this really make my case…

One of my favorite topical pinatas is the romantic notion that if we just put the “smart” people in charge, they can solve our problems (FYI, romantics usually say “smart” when they mean educated). My feeling is more aligned with William F. Buckley, who said: “I’d rather entrust the government of the United States to the first 400 people listed in the Boston telephone directory than to the faculty of Harvard University.”

While finding super-geniuses with passionate yet non-sensical beliefs is like shooting fish in a barrel, (a favorite bit of nonsense here) it’s always nice to run across some data that appears to confirm what Buckley knew.

Economist Craig Newmark’s post Sometimes, formal education just doesn’t seem to pay discusses a Chronicle of Higher Education study that tracked the level of education of state legislators. Newmark referenced a Cal Watchdog post that indicated a negative correlation between education and economic freedom:

When comparing the top and bottom 15 states to the Mercatus Center’s Freedom in the 50 States Economic and Fiscal Freedom Indicators, the statistics show that the bottom 15 educated states have a higher economic freedom and fiscal freedom score than the 15 most educated states.

Given this, I decided to run the numbers to see if there was a correlation between “smartness” and state deficits (gap as % of 2010 general fund), as I found with “blueness” and fiscal irresponsibility.

Because the folks at absolutely refuse to provide us with raw data — just a “cool” (NOT!) Flash interactive map — I decided not to spend a ton of time trying to key in information they MUST only present as pixels. Instead, I took the top and bottom five states (listed but can’t be easily copied/pasted grrr.) These ten states were aligned with 2010 state deficit data. Thankfully, the two biggest states are included (NY and CA alone capture 20% of the entire population of the USA).

The result? A small yet “statistically significant” positive correlation coefficient of .25. The smarter the legislators, the bigger the deficits.

Is this predictive? Who knows? Is it surprising? Not at all.

While I have the most polar data and a very large population sample represented, If anyone wants to grab the information for the other states and send me the data, I’ll be happy to run it.

If someone wants to rebut this post please, please, PLEASE have a better argument than “other things correlate too! — look!” I already know my correlation here is not 1.0…


2 responses so far ↓

  • 1 Steve Roth // Jul 19, 2011 at 10:42 am

    If educated legislators and “blueness” cause budget deficits, they also must cause:

    Higher GDP per capita
    Faster growth in GDP per capita
    Higher life expectancy
    Faster growth in life expectancy
    Smaller net transfers per person from the federal government
    Higher rates of entrepreneurship
    Much higher levels of VC investment
    Lower auto fatalities
    Lower divorce rates
    Lower infant mortality
    Faster decrease in infant mortality
    Lower murder rate
    Lower poverty rate

    “Is it surprising? Not at all.”

    That Koch-brothers-funded Mercatus concept of “economic freedom” is really a great thing, huh?

    (I find it damned surprising, BTW, that with only ten sample points and the low correlation you got any kind of statsig out of this latest.)

    No, these are not the “other” correlations you’re complaining about. That was about different *independent* variables — causes. This is your independent variable, with many dependent variables — results.

    If you think that education or blueness “causes” budget deficits based on correlation, you gotta agree that it causes all these other things as well — especially since most have much higher correlations and five times as many sample points.

    See also:

    And etc. etc.

  • 2 Steve Broback // Jul 31, 2011 at 11:42 pm

    While the link you provide is for “Blue” not “Smart”, I do find it reasonable to assert that the more you spend on things (like medical care) the better the results. My claim is that the blues are indeed — *very* good at spending, just not so much on budgeting.

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