Oh, Great. ANOTHER Fake Stat That Everyone Will Cite As True For A Decade Or More: The $400 Emergency Expense Lie

“Good news, Fake Campus Sexual Assault stats, Fake Gender Pay Gap stats, Fake Gun Violence stats, and the rest of the club! You have anew member!

Senator Kamala Harris cited the stat in April, and if someone doesn’t stop her, it will become part of the pro-socialism “narrative” during the 2020 election campaign.  “In America right now today,” she said, “almost half of Americans are a $400 unexpected expense away from complete upheaval.”  Naturally the statistic appealed to Top Demagogue Senator Elizabeth Warren, who echoed Harris last month: “The gap between incomes and costs is so gaping that 40% of Americans can’t come up with $400 in an emergency.” Then there is  Bernie, or course,  who says: “Four in 10 [Americans are] unable to afford a $400 emergency expense.”

I’m sure the rest of the field will come around to using the stat too; dishonesty loves company, especially when the idea is to frighten the members of public who trust what politicians say. And why shouldn’t they? Warren was a Harvard professor—she must know what she’s talking about! She wouldn’t use a statistic like that without checking it, would she? Nah! Warren and Harris are both lawyers too, and lawyers have enforced ethics rules that say they must not lie. All three—Warren, Harris and Sanders—are U.S. Senators. Surely three distinguished Senators wouldn’t all use a false statistic to deceive us! Would they?

Not only would they, they have. I admit, I’ve heard the $400 statistic many times, and just assumed it was grossly distorted somehow, because it makes no sense. There are so many  statistics like that designed by activists to make problems seem so much worse than they are, and to represent the U.S. as violent, poverty-stricken, racist hell-hole where women are paid a pittance, children are routinely sexually molested, college is a rape-fest, cops hunt down unarmed blacks for sport, and everyone is poor, hungry, anxious and miserable. Why we have an illegal immigration problem is a mystery; you would think that people would be streaming out.

I have to take some responsibility for the fake stat problem: assuming such bogus stats are junk, shrugging them off  and not checking the data is just as wrong as accepting them as truth.

Fortunately, Michael R. Strain, director of economic policy studies and resident scholar at the American Enterprise Institute, did his homework. His debunking of the stat isn’t spin, or a different take on ambiguous data. Strain went to the source material, and sure enough, everyone who apes Bernie, Kamala and Liz are either negligently passing on falsehoods or lying. His conclusion?  He writes, “It turns out the claim that nearly half of Americans are a flat tire away from financial crisis is largely based on an inaccurate reading of one survey question.”

“Inaccurate reading” is more than kind, as the rest of his analysis makes clear.

The question comes from the annual “Report on the Economic Well-Being of U.S. Households” by the Federal Reserve. The report finds, in 2018, that 61% of adults would cover a $400 unexpected expense using cash (or its equivalent). Politicians and many in the media seem to be subtracting 61 from 100, and concluding that 39% of people, to use Warren’s phrase, “can’t come up with” the money they’d need to handle this situation.

Are they all that stupid? Of course not. They are deliberately misrepresenting the finding. By no possible logic can one conclude that if 61% would cover a $400 unexpected expense using cash, the rest couldn’t cover it at all. Note also that for Harris, 39% is “almost half.” That’s a lie: even if the 39% figure was accurate, it’s a lot closer to a third than it is to “half.”


The report states: “Twelve percent of adults would be unable to pay the expense by any means.” I’m dubious about that as well. In any event, 12% is a lot less than 39%.

Why yes, it is! ‘About 10% ‘is a lot less than “almost half.” Do you really think Harris just misunderstood the report, or never read the report and accepted the talking points she was handed by some activist intern?

The report also goes out of its way to make clear that some of the 39% who wouldn’t use cash might still have $400 in the bank: “It is possible that some would choose to borrow even if they had $400 available, preserving their cash as a buffer for other expenses.” In a footnote, the report even cites a 2016 study finding that 76 percent of households had $400 in liquid assets, even after taking into account monthly expenses. A number of people with healthy finances carry some credit-card debt while also holding cash. A financial adviser might counsel against this, but it is not necessarily a sign that the borrower’s life is, to use Harris’s phrase, in “complete upheaval.”

Continuing to be too kind (or perhaps his tongue is in his cheek), Strain says,

“The common misinterpretation of this finding in the study is particularly strange in light of two other questions on the same survey. The Fed asks respondents whether they are able to pay all of their bills in full. Only 17% say they can’t pay some bills. Again, 17%, not 39%. The Fed also asks respondents how a $400 emergency expense that they had to pay would affect their ability to pay their other bills. Eighty-five percent report that they would still be able to pay all their bills. Only 14% say that the emergency expense would result in their not being able to pay some bills.”

It’s not strange, and I suspect Strain knows it. The media and politicians are deliberately misrepresenting the report to bolster their agendas and policies by manufacturing a dire state of society that doesn’t exist. The kindest explanation, to channel Strain, is that progressives are so convinced that life in the U.S. is nasty, brutish and short that confirmation bias drives their credulousness.


27 thoughts on “Oh, Great. ANOTHER Fake Stat That Everyone Will Cite As True For A Decade Or More: The $400 Emergency Expense Lie

  1. ”you would think that people would be streaming out.”

    Not unlike when the Berlin Wall came down ~ 30 years ago causing a veritable human stampede from West Germany into the Socialista Paradise we all knew as the Deutsche Demokratische Republik.

  2. Heck – I always refuse to pay with cash direct options for big expenses. There’s a little security in knowing I can decide how fast to pay something off or that i might have some purchase protection or price guarantee through my credit card company. Once you spend cash, it’s gone…there’s always more credit….it seems. …which is a fun way of saying you can always spend other people’s money.

    • Clearly Tim, you’re part of the Patriarchy. You think about money. Get with the program. You’re supposed to be hopeless and helpless. If you’re not, you’re an oppressor. Check your privilege. (I”m not real sure what exactly that means, but you should do it. Trust me.)

      • Of course I am! You were with me at the Tuesday’s meeting of the Patriarchy Leaders of Privilege… we voted on 6 different capitalist plans that would oppress others and enrich ourselves. (I’m still hoping for Option H.)

        By the way, I talked to Glenn, and he says that he agrees with you and really thinks that shark semen is the next big free market opportunity.

  3. Even if the allegation were true, what are these people proposing as the solution? What government program will make people run their household finances better? Government employees will be sent to South Houston to audit each family’s finances and then, what, give them a four hundred dollar savings bond? Four Benjamins to put in a box on a shelf in the bedroom closet? Teach them how to better budget their money?

    The reason we have an immigration problem is that if you can’t deal with a four hundred dollar expense in this country, you’re golden. You’re POOR! Halelujah! Praise God Almighty, I’m poor at last!

    A friend died of ALS a few years ago. She was a retired professional mezzo-soprano. She’d lost her net worth trying to start a community opera in Germany where she’d worked most of her life. She moved back home to the U.S. and came down with ALS. She was broke. Fortunately. Because she was broke, all her expenses were paid by Maricopa County. “Thank God, I’m broke. Otherwise, I couldn’t afford any of this stuff.” Her words.

    As the Manhattan Contrarian points out, how will we ever reduce the poverty rate and “income inequality” by raising taxes and giving money to poor people when taxes do not reduce reported income of the wealthy and government benefits do not increase reported income of the poor. No wonder the War on Poverty has been a bust. It’s unwinnable by its very terms of engagement.

  4. “Note also that for Harris, 39% is “almost half.” That’s a lie: even if the 39% figure was accurate, it’s a lot closer to a third than it is to “half.””

    I did some digging and found what might be the source of Kamala’s math thinkin…

  5. I broke my own rule today: I went to Politifact to see what they said.

    See, not going to Politifact is a rule, because they’re full of shit. This is the organization that rated the 39 variations on the theme of “If you like your doctor” from Obama and never rated it anything worse than “half true” before calling it their lie of the year in a year where Obama did not actually say those words, but had just been safely re-elected. Go figure.

    And again… They’re failing to call this anything worse than “half true” although I doubt it’ll ever make it to lie of the year. Apparently, Kamala Harris was factually wrong but morally right enough because while she’s plainly off on the numbers, “devastating” is subjective, and subjectively, perhaps putting the $400 on a credit card and paying it off over time could be devastating, it’s definitely stressful. I’m not making that up, they used those words.

    That’s enough of that garbage for another year or two.

  6. Does anyone remember the fake statistic something to the effect of “90 percent of Mexican crime scene recovered guns” coming from the “Iron River” of illicit guns coming from crooked American gun dealers?  For a while in the early days of the Obama administration, this statistic was widely cited by nearly all the big news outlets, and most of the Democratic Party big shots, Obama, Holder, Hillary, Durbin, Reid, Feinstein, and others… over and over and over. The whole idea was to illustrate the horribleness of the U.S. gun culture and to instill public outrage and calls for stricter gun laws.

    This statistic, upon closer examination, had almost no real data or valid calculations to back it up.  Several independent sources attempted to duplicate the methodology but always came up far short of the 90 percent claim. Still it was cited over and over and over.  Until… Fast and Furious was outed.  As it turns out that the crooked American gun dealers were not really gun dealers at all.  They were U.S. government officials.

    Then silence… no more “90 percent” statistic on Mexican crime guns. This false narrative was dropped like a hot potato.

    Yeah… politicians do lie now and then when it advances their political agendas… sometimes outrageously.   But more disturbing, the media will seems all to willing to go along with this practice if it involves the “good guys” with the “correct thinking” meaning usually Democrats. However, if it involves Donald Trump, they are quick to express their righteous indignation.

    • Another observation that I restrained myself from making.Indeed, Trump misleads, misstates and misrepresents constantly, mostly about trivia and mostly to his own detriment. Meanwhile, the pols who complain about his dumb lies issue substantive falsehood regularly.

  7. The Fed survey does not ask relevant followup questions such as:
    How many packs of cigarettes do you purchase per week;
    How often do you rely on any type of prepared food service firm for nutrition per week;
    How many Lattes, Frappes or other high end caffienated drinks do you purchase per week;
    How many tattoos have you purchased in the last year?

    By now you get my drift. I just watched a young woman buy a 3 dollar Red Bull on her state provided “Independence” card and then used her bank card to buy a $7 pack of cigarettes. I quit smoking after 50 years to stop paying the damn taxes. By my math she could save over 2 grand per year so if she is 400 bucks away from financial ruin there is her answer and in only two months.

    Financial security is fundamentally a personal responsibilty issue. I cannot tell someone that his or her choices are not yielding the person maximum satisfaction but I sure as hell should not be compelled to support with my money someone that puts immediate gratification ahead of proven long term general well being.

      • ”The Fed survey does not ask relevant followup questions such as:”

        Lest we forget the glaring difference between needs-n-wants.

        I recall an effort over 30 years ago to help a prospective client establish a very modest ($100/month) saving program.

        She: “We just can’t afford it.”

        Me: (observing 5 scratch-off tickets [scratched off/useless] on the kitchen table) “How often do you buy those?”

        She: (big smile creasing her face) “We (hubby & three kids) each get one per week.”

        Me: “There’s your $100, and then some.”

        She: (smile gone) “I told you, we just can’t afford it.”

        Me: (point made/no sale) “Here’s my card, let me know if you ever have any questions.”

  8. So this is, and always has been, Fake News.

    Imagine that. Our trustworthy, selfless media making such a mess of numbers. It’s almost as if they were educated in a communist education system or something…

    Harris and Warren — Leftist cant (and fictitious cant at that) in stereo. C’mon, Bernie, join the girls and make it 3.1. We may be able to get to 5.1 or even 7.1 with a few more joiners.

  9. I can well believe a figure in the 10% range as US adults who would be severely challenged by a $400 – $1000 unexpected expense. In most of those cases such is the result of poor choices accumulated over a period of decades with a flat learning curve. For the rest it is some poor choices coupled with a run of bad luck. Think divorced woman over age 50 HS education only and a local economy along the lines of Michigan in 2009 as a typical example. Over the decades there have been 20 or more cases in which I aided a family member or friend in that $400+ tight spot sometimes with a lecture more often without. Please do not applaud. It was my money and my choice done without depriving the immediate family of a single necessity. BTW, in not one of these cases would I ever have wanted the State to step in with the Taxpayers money.

  10. My favorite is still
    Currently 40% of guns in this country are sold without a background check…

    This is almost pure fiction. The source of this debunked claim is a single telephone poll of 251 (!) people by a couple of professors in 1994. Participants were asked if they thought a gun they had acquired (not necessarily even purchased) in the prior two years…before the NICS system even existed came from a licensed dealer. The six answer choices were “yes,” “probably was/think so,” “probably not,” “no/definitely not,” “don’t know”, and “refuse to report”. Any answer but the first two was classed as a “no”, and that total 35.7% rounded up to 40%.

    How can anyone with a shred of integrity continue to trot out this bogus claim? Bernie Sanders has used it.

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