I was invited to address a local real estate group and I received a question about the latest housing report … “Home sales have risen for three months in a row, is the housing crisis over?” I responded with assurances that housing is beginning to stabilize, so technically the crisis episode has passed, but the U.S. market for housing is severely weak. The question originated from a recent report that revealed sales of single-family homes increased by 11% in June from the previous month. However, new-home sales were 21.3% lower than the level in June 2008. Far from being a robust market for housing.
The question was a crisp reminder of how statistics can be misleading because “the devil is in the details”. For example, a widely touted statistic when discussing the current state of healthcare in America is the fact that 45 million people are currently uninsured. Politicians have become adept at using this number to sell voters on the need for a major overhaul of the healthcare system to insure protection for all Americans. However, when you analyze the widely used number, you discover some misleading points.
Consider the fact that somewhere between 15-20 million of the uninsured are illegal immigrants. Do we plan to cover them with a taxpayer funded health insurance plan? I acknowledge this group is a burden on the current healthcare system because they routinely use our emergency rooms and increase the cost on others to subsidize their care. Unquestionably, we need to address the problem of illegal immigration before extending coverage to people that does not pay taxes.
Furthermore, about 10-15 million of the uninsured are young and healthy young adults that voluntarily choose not to buy insurance. This group rarely visits the doctor, so they elect to forgo coverage and save the monthly premium. I was a member of this group until a few years ago, but I recognized the need for coverage as I got older. This group is transient and will purchase their own coverage as they move through life, taking on a career, and having children.
Finally, the last group, which is around 10-15 million people are the legitimate group of people that will benefit from structural changes in how we insure Americans’ health. This group is unable to purchase coverage due to income or pre-existing conditions. The system should be reformed in minor ways to create ways for inclusion of this group.
Statistics are good indicators and provide insight into a plethora of issues, but they can be used to justify misguided theories and solutions. Politicians are especially skilled at using numbers to promote party and special interests. The next time you hear the media quote a set of numbers … be sure to look hard for that “little red devil”.
