Nate Silver takes the Hot Air out of Cato's stimulus attack

Blog ››› ››› JEREMY HOLDEN

Right-wing blogger Allahpundit put some Hot Air behind a working paper out of the Mercatus Institute* in an attempt to attack stimulus spending as unfairly tilted in favor of Democratic congressional districts. But as New York Times columnist Paul Krugman noted, Nate Silver demonstrated that these results are entirely logical, thereby undermining any suggestion that the data illustrate a sinister political motive: The 18 congressional districts receiving the most stimulus money represent state capitals -- where much of the stimulus money is distributed -- which are far more likely to elect Democrats to Congress.

Trumpeting the research* under the headline "Analysis: Democratic districts getting much more stimulus money than Republican ones," Allahpundit stated, "That's the word from Cato scholar [sic] Veronique de Rugy, although she can't quantify how statistically significant the relationship is. There is a relationship, though. A big one." Allahpundit explained:

On average, Democratic districts received one-and-a-half times as many awards as Republican ones. Democratic districts also received two-and-a-half times more stimulus dollars than Republican districts ($122,127,186,509 vs. $46,139,592,268). Republican districts also received smaller awards on average. (The average dollars awarded per Republican district is $260,675,663, while the average dollars awarded per Democratic district is $471,533,539.)

Despite noting that de Rugy could not show statistical significance, Allahpundit concluded: "I'm sure everything's kosher: Surely a president who showed such fierce resistance to special interests during the ObamaCare process wouldn't let political considerations affect his stimulus awards."

As it turns out, everything just might be kosher after all. As Silver, the statistical analyst who blogs at FiveThirtyEight.com, notes, "A lot of stimulus funds are distributed to state agencies," which "are usually located in or near the state capital," and "state capitals are much more likely to elect Democrats to congress." With that in mind, Silver analyzes the distribution of stimulus spending:

[T]he study does not control for at least one other variable that is overwhelmingly important in determining the dispensation of stimulus funds.

The variable in question is in fact pretty obvious if you simply look at the districts that have received the largest amount of stimulus money, according to de Rugy's dataset.

The district that received the largest amount of stimulus funding in the 4th Quarter of 2009, according to de Rugy's tally, is California's 5th Congressional District. Is there anything notable about the 5th Congressional? Well, it is home to the state capital, Sacramento. Let's keep that in mind.

Next on the list is New York's 21st Congressional District. The largest city in the 21st is the state capital of New York, Albany.

Third is the 21st Congressional District of Texas. It contains parts of Texas' state capital, the wonderful city of Austin. (Another district that contains parts of Austin -- the 25th -- ranks 14th on de Rugy's list.)

At this point, it ought to be pretty obvious what is going on. The three districts receiving the largest amount of stimulus funds are home to the capitals of the three largest states -- New York, California, and Texas. Let's pause for a moment and make a bold prediction. I'll bet you that the district that ranks 4th on the list will contain the capital of the 4th largest state, Florida.

Bingo. Up 4th on the list is Florida's 2nd Congressional, home to Tallahassee.

Fifth is Pennsylvania's 17th, which hosts the state capital, Harrisburg.

The sixth through tenth districts contain the capital cities of other large states: Ohio, Georgia, Michigan, Illinois and New Jersey, respectively. They are followed by districts that include the state capitals of Indiana, Tennessee, Virginia -- then another part of Austin, Texas -- then Arizona, Missouri, North Carolina and Wisconsin.

Occam's Razor says that given two competing theories, the simpler explanation is better. But Occam didn't account for the fact that the simplest explanation often gets in the way of a good old right-wing conspiracy theory.

I previously identified de Rugy's working paper as Cato research and regret the error.

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