Monday, December 2, 2013

Time For A Rant: Dear Dave Ramsey, Correlation IS NOT Causation

I'm late to this particular rant, but I've got something to say about it, so I'm going to chime in.  Stop me if you're read this before.

Correlation is not causation.

Really, truly, it isn't.  Our puny human brains would like it to be.  We get very happy when we can see organization and meaning and structure even in random events, so when two things are clearly linked, it's very easy for us to believe that the first one caused the second.  It's not necessarily so.

One big example is the idea that childhood vaccines cause autism.  The initial link was suggested in a very small, poorly-performed scientific study that's been debunked often and thoroughly.  The idea persists, however.  Why?  Because the first symptoms of autism usually manifest between 12 and 15 months of age, and children get vaccines at 12 months and 15 months.  The shots and the symptoms are linked temporally.  However, it's no more accurate to say that the shots cause the symptoms than to say the symptoms cause the shots.

Why am I bringing this up?  Dave Ramsey's blog.  He's reposting, presumeably because he endorses, "Twenty Things the Rich Do Every Day."  I'm not quibbling over his statistics, even though I don't know where he got them.  I'm quibbling over the idea, clearly indicated, that these Twenty Things make people rich.  It's part of the if-you-poor-it's-your-own-stupid-lazy-fault idealogy.

But what if Dave's got the causation backward?  Think about it.  If he'd written "70% of all rich people drive automobiles costing more than $50,000," would we all automatically leap to assume that buying an expensive car makes you wealthy?  Or would we think, yeah, you'd have to be rich to spend that much on a car?

And so I present to you, Dave Ramsey's list, along with the possible alternative point of view:

1. 70% of wealthy eat less than 300 junk food calories per day. 97% of poor people eat more than 300 junk food calories per day. 23% of wealthy gamble. 52% of poor people gamble.

A:  Eating healthy food makes you more likely to succeed.
B:  Healthy food is nearly impossible to find in inner-city "food deserts" where the poor live; fresh fruits and vegetables and lean sources of protein are more expensive than less healthy food. 

A:  Watching every dollar leads to financial success.
B:  If you have almost no slack in your budget and a low-paying job, that very small chance you could turn a dollar into a million is just about the only chance you have to become rich.  Also, a lottery tickey can feel like hope.

2. 80% of wealthy are focused on accomplishing some single goal. Only 12% of the poor do this.

A: A mindset of success leads to success.
B:  Being able to focus on one goal is a luxury that can only happen when you know you and your family's basic needs--food, shelter, education, medical care--are being met.

3. 76% of wealthy exercise aerobically four days a week. 23% of poor do this.

A:  exercise leads to health and financial well-being.
B:  the poor can't afford gym memberships, trainers, exercise equipment, or child care for working out. 

4. 63% of wealthy listen to audio books during commute to work vs. 5% of poor people.

A: Improving your mind will increase success.
B: Listening to audio books during your commute implies that you commute alone, in a car, and can afford either the audio books or the gas to make frequent trips to the library.  Poor people taking public transportation are less likely to do this.

5. 81% of wealthy maintain a to-do list vs. 19% of poor.

A: Maintaining a list makes you wealthy?  (This one puzzles me.)
B: Illiteracy is a common cause of poverty.

6. 63% of wealthy parents make their children read two or more non-fiction books a month vs. 3% of poor.

A:  People who value education become wealthy.
B:  Poor people lack access to quality non-fiction books--even going to the library requires a commitment of time and gasoline.  Poor parents are also much more likely to have lower education to start with than wealthy parents, and have not been raised to read or encourage reading in their children.

7. 70% of wealthy parents make their children volunteer 10 hours or more a month vs. 3% of poor.

A:  Doing good works leads to wealth.  (??)
B:  Wealthy people are more likely to raise over-entitled children; they fight this by making their children experience need vicariously.  Poor families are more likely to need the income their teens could earn if they had a job instead of working for free.

8. 80% of wealthy make Happy Birthday calls vs. 11% of poor.

A:  Wealthy people keep in touch with their families and friends.
B:  Poor people can't afford cell phone minutes.

9. 67% of wealthy write down their goals vs. 17% of poor.

A: Concrete goals produce success.
B:  Hopelessness makes a mockery of goals.

10. 88% of wealthy read 30 minutes or more each day for education or career reasons vs. 2% of poor.

A: Reading for "education or career reasons" leads to work success.
B:  The poor are less likely to be fluent readers.  The poor are less likely to have ready access to books, e-readers, and computers.  The poor, having not graduated from high school and working at a low-skill, low-wage job, are less likely to see reading as a way to better their positions.

11. 6% of wealthy say what’s on their mind vs. 69% of poor.

A.  Learning to politely prevaricate leads to social success.
B.  The poor have nothing to lose by telling the truth.

12. 79% of wealthy network five hours or more each month vs. 16% of poor.

A. Social and business contacts are essential for career success.
B. Poor people lack the sort of contacts that allow for career "networking."  With whom does one network at the Taco Bell?

13. 67% of wealthy watch one hour or less of TV every day vs. 23% of poor.

A.  Television watching causes poverty; or, watching television is a sign of laziness.
B.  Poor people lack more expensive means of entertainment, such as computers, exercise equipment, country club memberships,  etc.

14. 6% of wealthy watch reality TV vs. 78% of poor.

A.  Reality televison is for stupid losers.
B.  Watching people compete for cash/affection is fun.

15. 44% of wealthy wake up three hours before work starts vs. 3% of poor.

A.  Early to bed, early to rise, makes a man healthy, wealthy, and rise.
B. Poor people work long, irregular, and difficult hours.  Who wakes up at 3 am for a 6am job?

16. 74% of wealthy teach good daily success habits to their children vs. 1% of poor.

A.  Teaching "good daily success habits" (what does that mean?) leads to success.
B.  Poor people can't teach what they themselves never learned.  Poor people struggle to provide their children with food, shelter, and care; they don't have time for teaching extras.

17. 84% of wealthy believe good habits create opportunity luck vs. 4% of poor.

A.  If you have good habits, you will succeed.
B.  If you are poor, you may be poor despite having good habits.  You've been crushed by the weight of crises too many times to believe your own efforts can forestall them.

18. 76% of wealthy believe bad habits create detrimental luck vs. 9% of poor.

A. If you have bad habits, you won't succeed.  Also, your lack of success is directly caused by your bad habits.
B.  You feel the deck has been stacked against you so profoundly from the start, that nothing you do will make it better or worse.  Poverty causes hopelessness.

19. 86% of wealthy believe in lifelong educational self-improvement vs. 5% of poor.

A.  Lifelong educational self-improvement leads to success.
B.  To the poor, self-improvement seems neither possible nor effacious.

20. 86% of wealthy love to read vs. 26% of poor.

A.  Reading causes success.
B.  Success causes a love of reading: children who were good readers early learn to love it; those who struggle in school, don't.  Children with access to good books learn to love them; children who've never experienced good books don't get that chance.

A lot of people have called Dave Ramsey out for this list.  Rachel Held Evans finds his perspective unbiblical.  Dave Ramsey, in return, has posted a long, rambling defense on his blog, which includes the fact that he was once "poor."  Aside from sounding a lot like, "but some of my best friends are black," I suspect his poverty was a lot like the poverty I and some of my friends experienced when we were newly married and our spouses were in medical school.  Sure, we made homemade Christmas gifts, lived in cheap apartments furnished with our parents' cast-offs, and worked very hard while our spouses toiled unbelieveable hours.  And yet.  We all lived in safe apartments.  We all had college educations, and worked jobs that paid salaries and benefits.   Our poverty was only poverty in comparison to the lives we would have when our spouses graduated.  It was faux poverty. 

Dave Ramsey's money management techiniques are sound, and I think his advice helps a lot of middle-class overspenders.  But when I think of applying his list to the clients I see at BFIA, I'm forced to conclude he doesn't understand poverty at all.