How To Chart Good

Having seen all too many charts that have been labored over in vain by students, academics, and practitioners alike, this resonates.

Irony: it's often difficult to communicate with charts, yet this one does a beautiful job.

Growth for the sake of growth, plus ignorance and expertise in complex situations: two depictions

Edward Abbey said “growth for growth’s sake is the ideology of the cancer cell":

From a series called Illuminating Quotes, Visualised by Maggie Appleton. I like this drawing because it shows that there is plenty of room in the concept of capitalism that isn't infected by this destructive ideology. That's where we ought to concentrate our energies.

Appleton also nicely visualized Edward R. Murrow's statement that "Anyone who isn't confused doesn't really understand the situation," which seems particularly apt when it comes to tax law, especially international:

Billionaires of the world ranked and charted

From Flowing data, links and commentary on an interactive chart called "Bloomberg's Billionaires", where you can see who the world's billionaires are and how they compare to each other:

There are four main views. The one above shows rankings, their estimated net worth, and the change from the previous estimate. Below is a simple ranking of the world's billionaires. Each floating head is clickable so that you can more information about the individuals, such as a short bio and where there money is from.

It gets more interesting when you click around and explore. For example, there's a plotting view, and the floating heads transition to their sectors, still sorted by ranking:

...[You can] Filter by gender, industry, citizenship, age, and whether or not a billionaire's money was mostly inherited. The slider on the bottom allows you to go back in time to see rankings and net worth change. That part did seem buggy though, as heads seem to disappear or get stuck if you shift too much.

Fascinating, if voyeuristic, and in the typical vein of media obsession with the rich. If Bloomberg produced "Bloomburg's Penniless," and told us all about some of the world's poorest people and just exactly how they got there, would we pay attention?

So much for the end of men

NPR has a story on the college payoff, showing that while students pay much more for a college education in the U.S. than they do in most other countries, they also get a bigger return on their investment.  But for me the big story is the enormous gender difference in that payoff.  Wow!  There continues to be a huge premium for maleness across the globe, but it is striking indeed how much more being male in America gets you:

And what explains why college costs more for women in the U.S., Germany, and Canada?  It can't be a base price differential along gender lines, I would think (lawsuit, anyone?), so is it that men are given more scholarships?

The story points us to this study from Indiana University with more detail on the gender gap, including this chart showing that women must obtain associate's degrees to match the salary levels of men with high school degrees:  

I can't see how this information in any way squares with the notion that women are pulling ahead of men. 

Evidence: it's ok to tax millionaires

Richard Murphy points to this story that argues, contrary to conventional wisdom, millionaires do not necessarily flee high tax jurisdictions in search of tax havens:

From the article:

This newspaper's review of tax return data for 2010, the most recent year for which data is available, found no link between the state income tax rate and the number of people who reported adjusted gross income of at least $1 million.
Consider:

• The states with the most and fewest rich people per capita are Connecticut and West Virginia, respectively. In Connecticut, one of 190 taxpayers earns at least $1 million in adjusted gross income. In West Virginia, just one out of every 1,400 filers make that much. Yet both states tax rich people about the same.
• Our neighbors: Nevada is income-tax free; Oregon has one of the nation's highest income taxes on the rich; and Arizona is about average. Yet all three have a below-average number of rich people per capita.
• In the Midwest: Illinois and Ohio charge about the same income-tax rates and have similar populations. Yet Illinois has 233 millionaires per 100,000 taxpayers, while Ohio has 107 per 100,000 taxpayers.
• In the Northeast: Massachusetts has more than double the millionaires per capita than neighboring New Hampshire, which is income-tax free.

Murphy concludes from this report that "It's fairly easy to move in the US. But people don't."  He therefore suggests we lay the mobility myth to rest since it would be comparatively much more difficult to move across national borders.  If people don't do it when it's easy, what will make them do it when it's hard?

I think and hope this is generally true--that people have cultural/social ties to places that prevent purely fiscal decision-making, so we don't need to coddle the rich out of fear of a Randian exodus, but can ask them to contribute more to the societies in which they live.  But the high profile cases we see in the news suggest that when it comes to the super-rich things might not be so clear.  Maybe they stay put but nothing stops them from engaging in the standard game playing that puts money out of sight to governments while doing so.  It could even be worse for society if they physically hang around but play all kinds of games rather than paying their taxes; in that case, it might be preferable if they pull a Saverin.

Which Americans have no health insurance?

The Census has published Income, Poverty and Health Insurance Coverage in the United States: 2011, which yields the following picture of where the 48.6 million Americans without health insurance live (numbers in thousands):

So almost half live in the south, most of which are red states (opposed to national health care, writ large):

Summary of results of the 1996, 2000, 2004, and 2008presidential elections:

  States carried by the Republican in all four elections

  States carried by the Republican in three of the four elections

  States carried by each party twice in the four elections

  States carried by the Democrat in three of the four elections

  States carried by the Democrat in all four elections

Source: Wikipedia

They are also many of the poorest states:

Source: The Poorest States of America

Many (but not all) spend the least on health care:

Source: What Our Health Spending Buys Us

And they are among the states with the worst health outcomes across the nation:

Source: What Our Health Spending Buys Us

What Americans Do All Day

They commute, work, and sleep, mostly.  48 minutes to groom, 34 minutes to care for others, 6 minutes to learn something.  Oh, for a country by country comparison.  From NPR:

Wealth disparity pyramid

I wish this diagram would draw the rest of the picture, i.e., the enormous block holding up the rest of the pyramid, but this is a powerful visual in any event:

From TJN via Richard Murphy.

Middle class wipe out

40% drop in the median income in the past four years.  It looks like this:

via Slate, who attributes the result to declining wages and incomes, the stock market crash, and the bursting of the housing bubble.  The stock market and housing crash might be considered one-offs (if you're an eternal optimist) but declining wages looks to be structural and endearing in nature, and in fact should worsen because labor is engaged in a global competition, with the result, as we have seen, that productivity gains have not gone to workers:

via politics of equality blog.

The world's richest countries and peoples

Two infographics of interest from NPR.  Total GDP by country:

and on a per capita basis:

Tax fairness: an interactive infographic

You can choose your tax reform options and see how it impacts the curves.  Compare, for example, eliminating the EITC with doing the Reagan thing to capital gains.  Since the Laffer curve doesn't kick in until at minimum about 70% or so, I figure you could raise almost $400 billion with just a few tweaks.

US and Foreign Employment & Sales by MNCs

Newly released BEA report, Summary Estimates for Multinational Companies: Employment, Sales, and Capital Expenditures for 2010.   They just have one little chart on their website:

So I put together a few more.  Here are a couple on their employment data (from tables available in the full report, pdf):

First, you can compare employment in the US and abroad in US-headed multinationals (I didn;t bother putting the date range breaks in, as in chart 1 above):

The numbers are in millions of employees.  This seems to indicate that there was an upward trend of foreign hiring up until some time between 2004 and 2007, and then a holding steady of both foreign and US employment within US MNCs since then.  BEA's chart 1 seems to express this as a steady decline in US employment, which it certainly is as a percentage of total employment, but  it looks like surging foreign employment is responsible for the decline.   Also this doesn't necessarily means that grey bars represent only American citizens and orange represent only foreign citizens, since companies may move people around and it may be that many of the grey people are foreign and the orange people American, but in any event it's likely that the majority are citizens of the country in which they are employed.

They also have statistics for US employment by US affiliates of foreign-headed MNCs, but annoyingly the years do not all correspond so this looks a little odd when charted:

Even so we can see that foreign companies hire what looks like about half as many people in the US as US MNCs do abroad, and the employment in the US seems to be holding steady after a slight uptick between 1999 and 2002.

Now a couple on sales.  Here are US vs foreign sales of US-based MNCs:

Steadily rising, across the board, but look at the relative picture, sales by US Parent as a percentage of the total sales of US MNCs (BEA didn't provide this data so I calculated as USP sales/(USP sales + foreign affiliate sales):

That looks pretty startling doesn't it.  But it just means that overall, for US MNCS, foreign sales are growing faster than US sales.  That's one reason to be an MNC--expansion to other markets.

Now here are sales by US affiliates of foreign MNCs added in (again with the mismatched years):

A bit of an upward trend until 2009, no surprise there, with an uptick in 2010 but more modest than that of the US MNCs.

Military spending: USA vs rest of the world

From Stockholm International Peace Research Institute, latest military expenditure data.  But note that the USA isn't even in the top twenty in terms of per capita spending--that honor goes to the Middle East.

Water: a Public Good?

Is water a public good?  Privatizing water has led to all kinds of traumatic consequences in poor countries, with many complaints aimed at IMF conditionality-imposed schemes.  India is considering a draft bill to privatize water there, where shortage seems particularly imminent: "India has more than 17 percent of the world's population, but has only 4% of world's renewable water resources with 2.6% of world's land area."  There is plenty of worry about what the bill will mean in terms of pricing for profit-oriented industry and long-term infrastructural consequences.  In a post last month I suggested that I thought waste disposal likely ought to be a public good because a private market would tend to want more garbage (more volume, more profit), while a public system might try to minimize garbage in order to reduce costs or meet other social goals such as conservation--the same principle seems to hold for water.

Visual News has a story (and of course a great infographic) on America's water crisis:

Basically we consume too much, both directly and indirectly, we waste a lot due to aging infrastructure, and we otherwise contaminate it with chemicals.  A startling stat: municipal water in 71% of U.S. cities has too much hexavalent chromium in it. If you don't remember why you should worry about that, you just need to think Julia Roberts:

Here is the CIA World Factbook's page on water resources, showing " the long-term average water availability for a country in cubic kilometers," i.e., the total water available to the country in an average year.

The 10 countries with the most water on average:

1. Brazil--8,233 cu km
2. Russia--4,498 cu km
3. Canada--3,300 cu km
4. United States--3,069 cu km
5. Indonesia--2,838 cu km
6. China--2,830 cu km
7. Colombia--2,132 cu km
8. Peru--1,913 cu km
9. India--1,908 cu km
10. Venezuela--1,233 cu km

And the 10 countries with the least:

1. Kuwait--0.02 cu km
2. Saint Kitts and Nevis--0.02 cu km
3. Maldives--0.03 cu km
4. Malta--0.07 cu km
5. Bahrain--0.1 cu km
6. Qatar--0.1 cu km
7. Antigua and Barbuda--0.1 cu km
8. Barbados--0.1 cu km
9. United Arab Emirates--0.2 cu km
10. Cape Verde--0.3 cu km

$1 Trillion In Tax Loopholes

I don't call these loopholes, since my definition of a loophole is a way to avoid taxes that is likely not intended by congress (i.e., an exploitation of an unintended structural weakness); these are, rather, tax expenditures as Steve Dean noted in his post yesterday, and as NPR explains.  

NPR invites us to:

Imagine a program where the government sent an annual check to homeowners with mortgages. The bigger the mortgage, the bigger the check. Checks for rich people would be bigger than checks for the middle class. Also: Checks for people with mortgages on vacation homes! 

It's hard to imagine a program like that getting much support in Congress these days. But, through the mortgage-interest tax deduction, the government does something like this every year. 

...Tax expenditures will cost the government somewhere around $1 trillion this year. That's more than the government will spend on Medicare or defense. The graphic ... lists just a few tax expenditures; this report (PDF) from the Congressional Joint Committee on Taxation has a much longer list.

Then NPR proposes that "If economists ran the tax code, there would be far fewer of these loopholes. Taxes might be higher or lower than they are now. But either way, the tax code would be simpler."  This is preposterous.  It imagines economists as some mythical sector that is completely devoid of social, cultural, political, or philosophical thought.  I often link to Dierdre McCloskey's work as the best antidote to both the proposed existence of such a sector and the idea that anyone would invite the rule of such sector should it possibly exist.

NPR concludes with the adage that tax expenditures are unnecessary and inefficient because the government could just hand out money to those it wished to help, through direct spending.   Let us be clear.  The government in America will not hand out cash, even if it is the equivalent of a tax expenditure, and even if by anyone's view, even (gasp) an economist's, the outlay would be desirable from an economic, political, social, and cultural perspective.   The direct spending well is completely poisoned in America.  A NY Times weekend story on the ever-diminishing welfare rolls is the latest illustration of this cultural phenomenon.

What Americans Buy

This is another interesting visualization of things Americans buy, depicted in terms of market saturation over time.  The Atlantic charts 100 years of technology by showing what percentage of homes had what as innovations emerged:

So that in 1900 five percent of households had a telephone; by about 1950 half of households had one, and the market is saturated by somewhere around 1970, when most households have one.  Cell phones come along in the 80s, reach half of households by early 2000s, and are very close to 90% by 2005.  Interesting--it took 50 years to go from none to half of all households having a telephone, while it took 20 years to do that for the cellphone.  But look at the microwave and the VCR: each looks like it took only about 10 years to do the same thing.  I'm surprised the VCR hasn't dropped off more.  I'd love to see a chart that showed U.S. purchases of vinyl, 8-track, cassette, cd, and digital music over time.

Related, here is another installment in Planet Money's series on the topic of U.S. consumption patterns.  The visualizations are well done as usual.

How Americans currently allocate their cash:

 
Compare to how they spent their cash 60 years ago:

Planet Money points out that food & clothing are cheaper due to productivity increases, while people are buying much bigger houses (about 1000 sq ft in 1949, about twice that in 2011) and more cars.  Medical care goes up for all kinds of reasons.  

How do we spend our money: US vs. rest of the world

American consumers spend more on health care and housing, less on food and clothes than consumers in Canada, Britain, and Japan..  From the NYT's Catherine Rampell, economix blog:

As we know, it's a lot more on health care:

What do Americans do for a living?

They mostly work in government, trade, education, health care, and professional services.  From NPR:

Compare to 1972: