Quote of the Day: Excel Error Destroys the World

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From Mike Konczal, summarizing a new study that says Carmen Reinhart and Ken Rogoff made a coding error in a famous paper claiming that economic growth slows down in countries with debt levels above 90 percent of GDP:

If this error turns out to be an actual mistake Reinhart-Rogoff made, well, all I can hope is that future historians note that one of the core empirical points providing the intellectual foundation for the global move to austerity in the early 2010s was based on someone accidentally not updating a row formula in Excel.

In an update, Konczal tries to be a killjoy:

People are responding to the Excel error, and that is important to document. But from a data point of view, the exclusion of the Post-World War II [data] is particularly troublesome, as that is driving the negative results. This needs to be explained, as does the weighting, which compresses the long periods of average growth and high debt.

Yeah, yeah. The authors of the study suggest that R&R’s paper has three separate problems: (a) exclusion of some high-growth/high-debt years following WWII, (b) weighting of slow-growth episodes in a dubious way, and (c) the Excel error. I assume that Reinhart and Rogoff will respond to all of this at some point.

In the meantime, though, I prefer to think of this as the Excel Error Heard Round the World.

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THE BIG PICTURE

You expect the big picture, and it's our job at Mother Jones to give it to you. And right now, so many of the troubles we face are the making not of a virus, but of the quest for profit, political or economic (and not just from the man in the White House who could have offered leadership and comfort but instead gave us bleach).

In "News Is Just Like Waste Management," we unpack what the coronavirus crisis has meant for journalism, including Mother Jones’, and how we can rise to the challenge. If you're able to, this is a critical moment to support our nonprofit journalism with a donation: We've scoured our budget and made the cuts we can without impairing our mission, and we hope to raise $400,000 from our community of online readers to help keep our big reporting projects going because this extraordinary pandemic-plus-election year is no time to pull back.

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