Trust in Government Policy Starts With Reliable Data
There are three kinds of lies: lies, damned lies and statistics. ― Mark Twain.
A recent audit of the National Statistical Office (NSO) shows the American author is still as right as he was in the 19th century.
According to a report by the Board of Audit and Inspection, the NSO has: failed to reflect on the census about 1,300 people who died without relatives in Seoul and 10 other large cities and provinces between 2006 and 2008; surveyed that there were no chickens in a North Jeolla Province township last December without visiting the 70-odd farmhouses, but actually 48,500 chickens were being raised there; and swelled the cultivated acreage in Gyeonggi Province by 624,660 square meters by including land turned into golf links.
Sounds rather trivial? Probably, but there are far more grave errors, too. The NSO, for instance, estimated the national debts in 2006 at 282.7 trillion won, 9.5 trillion won more than the actual 273.2 trillion won, while tallying Korea's gross domestic product growth rate in the third quarter of 2007 at 1.3 percent, while the nation's total output of goods and services less foreign income grew 1.4 percent during the period.
Incorrect statistics are no small problem, which might cause a huge waste of taxpayer money and works to pull down trust in the administration in and outside of the country. One reason seems to be the NSO's inadequate staff and budget compared to foreign countries. The number of government statisticians per one million people in Korea was nine in 2004, compared with 159 in the Netherlands, 130 in Canada, 87 in Australia and 51 in the United States. An assistant minister-level official currently heads the NSO, unlike most other independent agencies led by vice ministers, putting it at a disadvantage in getting a budget.
Mindful of the fact that correct data should be the basis of good administration, President Lee Myung-bak needs to call for sufficient investment in statistical manpower and equipment.
Yet there are also numbers that are not wrong by themselves, though are far more illusionary than wrong figures in affecting not just ordinary citizens but policymakers. A case in point is the unemployment rate. Korea's jobless rate of 4 percent is half of that of the United States, but this disguises the real situation. Unlike in America where the government provides various methods of support to the unemployed, there are few incentives for the jobless here to report their status to the government, which offers little support for people out of a job. Some government economists even argue against such benefits for fear of a jump in jobless rate.
The government's undue emphasis on current-account surplus, probably aimed at stabilizing foreign exchange markets, is equally misleading, because receivables for some exports, like shipbuilding, have already been sold out on currency futures markets. Also, how many taxpayers would know that their disposable income is only 55 percent of GDP?
An average citizen's illusion may matter little but the problem could turn serious if officials, from President Lee on down, begin to be dazzled by these figures, either knowingly or not.