Saturday, October 21, 2017

Veterans, the Living Wage, and the McNamara Fallacy


In the first post for the eighth year of the blog I was going to reflect on the Ken Burns film about Vietnam.  My first impression was how little things have changed since then with all of the protests.  The second thing that jumped out at me was President Johnson's defense secretary's obsession with collecting data (mostly body counts) to determine who was winning the war.  This is called the McNamara fallacy and is discussed below.



In my blog and my other writings I use statistics to enlighten people and to shed light on various social phenomena.  For example, for the Hill Talk, I looked at various variables which may predict the magnitude of the increase in the living wage for the cities/counties that have passed such ordinances.  

The graph below shows the strongest predictor which is the percentage of veterans in that city/county.  As the percentage of the veteran population increases by one percent, the amount of the living wage decreases by an expected 59 cents.  This relationship accounts for 28% of the variability in the amount of the living wage passed. 


The mean % veterans of the 38 living wage entities is 5% while the US as a whole has 6.2% of its population who are veterans.  Case in point Seattle, WA passed a $15/hour living wage ordinance while nearby Tacoma, WA passed a $12/hr wage.  Tacoma has 9.34% of its population as veterans while Seattle has less than half at 4.54%.  All of the cities that have passed a $15/hour wage or higher have % veterans that are lower than the US as a whole.  Six of the nine cities/counties with wages $15/hr or higher are in California.  

If one spends too much time looking at the leaves and the twigs on a tree, one can miss the surrounding forest.  This is basically what the McNamara fallacy is.  New findings with statistics can reveal important features of the forest as I believe this analysis has with regard to the forest activists must navigate to pass a living wage ordinance.  

The percentage of veterans in a city/county was the most robust variable negatively associated with the amount of the living wage increase after considering the % poverty, the % foreign born, the % change in the population, the % uninsured, the % in poverty, median household income, median housing value, and the % with a high school education or higher.  The full data set used in this analysis can be seen here.  The amounts of the minimum wage increases were found from the National Employment Law Project or NELP.  The demographic information on the cities/counties that have passed these ordinances was found from the Census Bureau at Census.gov.

Unlike McNamara and later Donald Rumsfeld and their ilk, I do not claim to have a full grasp of the whole forest surrounding the Fight for $15.  Further research is needed to fully understand the forest.  An argument could be made that it was the arrogance of men like McNamara and Rumsfeld that created the large population of veterans in the US.  One would think that if anyone could use a raise the veterans could.  A significant portion of the homeless population are veterans.


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