Measure performance and avoid ‘bell curves’

In an Oct. 8 Bangor Daily News op-ed column (“Elephant in sheep’s clothing?”), Paul Tormey tried to make a case for framing Maine’s economy as a partisan political issue – it’s not. The economy is everyone’s issue, everyone’s special interest, regardless of political affiliation.

It was encouraging that Tormey attended the Maine Economic Research Institute’s (MERI) 2004 symposium on the Maine economy, which was recently held in Bangor. At the symposium, he had the opportunity to listen to nationally renowned economist and small business advocate, Raymond J. Keating, as well as, the University of Maine’s John M. Murphy Chair of International Business Policy and Strategy, Dr. John F. Mahon, review the status of Maine’s economy.

It was also encouraging to read that Tormey acknowledges Maine’s economy is in dire need of repair. However, unfortunately, he misinterpreted MERI’s Economic Ratings

of the economic performance of state legislators.

Tormey suggests that somehow these ratings need to paint some sort of hypothetical “bell-shaped curve” where most rated legislators end up in the middle of the ratings with a few at either end of the curve. The concept of a bell-shaped curve is a theoretical invention, an idealized conception that simply does not describe the facts in this case.

No empirical distribution – one based on actual data, such as MERI’s state legislator Economic Ratings – ever satisfies the properties of this hypothetical curve. Some people tend to “feel” better about having everyone in an indistinguishable middle. Most of us have experienced first-hand the desire to artificially create this middle when a teacher “curves” grades to move more grades into the middle. The result of ignoring the facts and skewing data toward the middle may make some “feel” better about the results, but we do so at the cost of understanding the facts.

Accountability is an uncomfortable garment to wear for some, but MERI would be doing the public a huge disservice by “curving” its ratings so that some feel more comfortable with the results. Grade-inflation would not help the public understand how their representatives are performing on key economic issues. We think this would be a bad idea and at MERI we will continue to tell it like it is, no curves, no skewed data, no spin.

It is only through accountability and understanding the facts that Maine’s economy will be improved. Every legislator will tell you they are for jobs, for a strong economy, and that they want to help our state’s employers. They have been saying this as long as anyone can remember, yet we have results that tell us something different.

Our children are leaving Maine for opportunity elsewhere at a rate four times the national average. Why? The U.S. Census tells us in an August 2004 report that Maine incomes went down during the same period the incomes of our neighbors in New Hampshire and Vermont went up. Why? The U.S. Census also tells us that the poverty levels in those same neighboring states went down during the same period while Maine’s poverty level went up over 20 percent. Why? There are a myriad of additional reports that put Maine at the bottom of the economic pile. If our state legislators are actually performing the way they promised, why do we continue to have an economy that continually under performs?

At MERI we believe when it comes to the economy, citizens should listen to what politicians say, but measure what they do. It is good for us and

it is good for them.

MERI has only one agenda: a strong economy. It’s really that simple and it’s not political. That is why we clearly communicate MERI’s methodology on our Web site, www.fixmaine.com, and in our publications. Blind to political affiliation, MERI’s methodology is time-tested and successfully used in almost half the states in our nation.

Edward J. McLaughlin is the president of the Maine Economic Research Institute.