The Importance of Numeracy
By David Henderson
When I was the senior economist for health policy under Martin Feldstein, chairman of President Reagan’s Council of Economic Advisers, one of his biggest criticisms of politicians was their innumeracy. I agree that that matters a lot, and it’s not just politicians but also many pundits who are innumerate.
I started teaching a 45-minute segment on numeracy about 25 years ago in every class I teach at the Naval Postgraduate School. What caused me to do it was a comment I made in class one day that, if the students had had any idea of the U.S. population, should have caused them to gasp or, at least, raise their eyebrows. (I don’t remember my comment.) When I saw basically zero reaction, I asked them to take a scrap of paper and, without putting their names on the paper, write down their estimate of the U.S. population. At the time, it was about 250 million.
The median answer was great and so was the mode–both within about 2% of the right answer. But the range? The low end was 1.5 million. The high end was 1 billion. I pointed out that if the low end were right, it would mean that everyone in the United States was in the U.S. military.
What caused me to think of this was this comment by Jonah Goldberg:
The Left’s identity-politics game is a bit like the welfare states of Europe, which exist solely by living off borrowed capital and unrequited generosity. Europeans can only have their lavish entitlements because they benefit from our military might and our technological innovation. Left to their own devices, they’d have to live quite differently.
It’s the “our military might” that grabbed my attention. I’m sure that Goldberg has in mind the fact that the U.S. government is spending a higher percent of U.S. GDP on the military than the welfare states of Europe do. But even if the welfare states raised their percent to equal the percent that the U.S. government spends, that would be an increase of about 2 percentage points of GDP. That’s a substantial number and doing that would require either an increase in taxes or a reduction in, most likely, welfare state spending. But it wouldn’t mean that they would have to live “quite differently,” not when government spending in those countries is typically over 40 percent of GDP. Goldberg’s innumeracy here is not nearly as bad as that of the outliers in my class. Still, though, it would be hard to make his case if one had the right numbers.