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Richard Rider

San Diego releases fake figures on the city’s financial outlook — the U-T swallows it whole

Once again the SAN DIEGO U-T newspaper reporters failed to look skeptically at false government projections.  In this case, the city of San Diego grandly released their “Fiscal Year 2021-2025 Five Year Financial Outlook.”  While the report admits that, as it stands, there are annual budget shortfalls, it foresees this shortfall declining each year until 2025, when the city bureaucrats project a surplus — with no tax increases.  Absolute poppycock.
https://www.sandiegouniontribune.com/communities/san-diego/story/2019-11-12/san-diego-budget-facing-steep-deficits-as-expenses-continue-to-rise

ADDENDUM:  At the bottom of this article is a U-T editor’s welcome if lame response to this critique.  And my response to his response.  Fun read.

Granted, the city report is full of cautionary notes and caveats.  The likely chance of a recession is mentioned, but that adverse effect is not included in the outlook.

ALL such projections should include such disclosures of uncertainties.  No multi-year “outlook” is going to be accurate.  But it should be a best effort outlook.  A worthwhile prediction should state the RANGE of possible outcomes, with the numbers to match.

It turns out that this Pollyannaish projection will be very, VERY wrong.  And by a LOT.  That’s because the authors of this city study are either incredibly incompetent, or they are LYING (I suspect the latter is the more likely explanation).  I guarantee it. The projection understates the city outlays by at least $100,000,000 annually by 2025.

There’s many problems with this city analysis, but let’s focus on just one huge misrepresentation.

Looking at the city’s actual 67 page analysis, let’s concentrate on the report’s one page chart summarizing this absurdly optimistic “outlook.”
https://www.sandiego.gov/sites/default/files/fy21_25outlook.pdf
page 6 of the 67 page document

In the U-T story, the city politicians boast that they plan to hire more police, more firefighters and more librarians. All six city employee union contracts come up next year, and everyone understands that this means more across-the-board pay increases and better benefits.

Yet in the above-referenced city chart, here’s the city’s 5 year “financial outlook” for total city employee “salaries and wages”
2021 $652.7 million
2022 $654.3
2023 $652.2
2024 $652.0
2025 $653.2

In other words, this table shows essentially NO increase in the salary budget after five years of expanding the city workforce and providing pay increases. My “best effort” back-of-the-envelope figuring puts the real salary figure at $80 million higher in 2025 than the city projects — and probably the increase will be larger than that.

I understand the city lying. The city employees and the politicians have a shared interest in fooling the public (and the media) for as long as possible. But I’d expect better from our vaunted MSM.

Apparently U-T reporters’ eyes glaze over when they look at numbers. Indeed, they just reported what the city press release told them — without reviewing the “outlook” document itself. Looking at this chart, any middle school kid should be able to spot the obvious lie.

Too often U-T reporters simply report. They don’t think. They suffer from acute innumeracy. Even worse, reporters don’t press officials with uncomfortable questions — supposedly the role of our free press.

Does the newspaper still employ editors? If they do, the paper should fire most of ’em. Apparently too many U-T editors are useless deadwood that obviously no longer serve a purpose.

NOTE: Here is the newspaper’s unofficial response by an editor to my diatribe — and my reply:

  • Matthew T. Hall
    Matthew T. Hall Richard: the story states, “The financial outlook also doesn’t account for pay raises for the city’s 11,000 employees, despite all six of the city’s labor unions participating in ongoing negotiations because each of their contracts are set to expire next June.”
    • Richard Rider

      Richard Rider I fully recognize that, Matt. That’s what I said —

      ***
      . . . the city report is full of cautionary notes and caveats. The likely chance of a recession is mentioned, but that adverse effect is not included in the outlook.

      ALL such projections should include such disclosures of uncertainties. No multi-year “outlook” is going to be accurate.

      But it should be a BEST EFFORT outlook. A worthwhile prediction should state the RANGE of possible outcomes, with the numbers to match.
      ***

      Leaving out city employment growth and pay increases results in a lie. Trust me, many readers will think this forecast presents actual researched numbers we can expect to be reasonable.

      After all, look at the “salary” number from year to year. It varies a tiny, TINY bit each year. This indicates some research — a pretense that somewhat reliable variables are at play. It’s bullshit.

      You know better. Your reporters do not.

      Note that the city “outlook” had no problem projecting the REVENUE increases years into the future — even more “iffy” numbers, but they probably DO represent a “best efforts” prediction.

      Come on, Matt — by not doing this sort of rudimentary analysis, the quality of your paper continues to deteriorate. Sad but true. Stop rationalizing, and use what influence you have left to bring up the paper’s standards.

      BTW, I’m available to teach your reporters and editors how to analyze numbers. More important, I can teach them about SKEPTICISM — an old school journalism trait that no longer seems to be valued by the MSM — or the U-T.