Factfulness: Ten Reasons We're Wrong About the World – and Why Things Are Better Than You Think (8 page)

LEVEL 4. You have more than $64 a day. You are a rich consumer and three more dollars a day makes very little difference to your everyday life. That’s why you think three dollars, which can change the life of someone living in extreme poverty, is not a lot of money. You have more than twelve years of education and you have been on an airplane on vacation. You can eat out once a month and you can buy a car. Of course you have hot and cold water indoors.

But you know about this level already. Since you are reading this book, I’m pretty sure you live on Level 4. I don’t have to describe it for you to understand. The difficulty, when you have always known this high level of income, is to understand the huge differences between the other three levels. People on Level 4 must struggle hard not to misunderstand the reality of the other 6 billion people in the world. (Roughly 1 billion people live like this today.)

I’ve described the progress up the levels as if one person managed to move through several levels. That is very unusual. Often it takes several generations for a family to move from Level 1 to Level 4. I hope though that you now have a clear picture of the kinds of lives people live on different levels; a sense that it is possible to move through the levels, both for individuals and for countries; and above all the understanding that there are not just two kinds of lives.

Human history started with everyone on Level 1. For more than 100,000 years nobody made it up the levels and most children didn’t survive to become parents. Just 200 years ago, 85 percent of the world population was still on Level 1, in extreme poverty.

Today the vast majority of people are spread out in the middle, across Levels 2 and 3, with the same range of standards of living as people had in Western Europe and North America in the 1950s. And this has been the case for many years.

The gap instinct is very strong. The first time I lectured to the staff of the World Bank was in 1999. I told them the labels “developing” and “developed” were no longer valid and I swallowed my sword. It took the World Bank 17 years and 14 more of my lectures before it finally announced publicly that it was dropping the terms “developing” and “developed” and would from now on divide the world into four income groups. The UN and most other global organizations have still not made this change.

So why is the misconception of a gap between the rich and the poor so hard to change?

I think this is because human beings have a strong dramatic instinct toward binary thinking, a basic urge to divide things into two distinct groups, with nothing but an empty gap in between. We love to dichotomize. Good versus bad. Heroes versus villains. My country versus the rest. Dividing the world into two distinct sides is simple and intuitive, and also dramatic because it implies conflict, and we do it without thinking, all the time.

Journalists know this. They set up their narratives as conflicts between two opposing people, views, or groups. They prefer stories of extreme poverty and billionaires to stories about the vast majority of people slowly dragging themselves toward better lives. Journalists are storytellers. So are people who produce documentaries and movies. Documentaries pit the fragile individual against the big, evil corporation. Blockbuster movies usually feature good fighting evil.

The gap instinct makes us imagine division where there is just a smooth range, difference where there is convergence, and conflict where there is agreement. It is the first instinct on our list because it’s so common and distorts the data so fundamentally. If you look at the news or click on a lobby group’s website this evening, you will probably notice stories about conflict between two groups, or phrases like “the increasing gap.”

There are three common warning signs that someone might be telling you (or you might be telling yourself) an overdramatic gap story and triggering your gap instinct. Let’s call them comparisons of averages, comparisons of extremes, and the view from up here.

All you averages out there, please do not take offense at what I am about to say. I love averages. They are a quick way to convey information, they often tell us something useful, and modern societies couldn’t function without them. Nor could this book. There will be many averages in this book. But any simplification of information may also be misleading, and averages are no exception. Averages mislead by hiding a spread (a range of different numbers) in a single number.

When we compare two averages, we risk misleading ourselves even more by focusing on the gap between those two single numbers, and missing the overlapping spreads, the overlapping ranges of numbers, that make up each average. That is, we see gaps that are not really there.

Look at the two (unrelated) graphs here, for example:

The graph on the left shows the gap between the average math scores of men and women taking SAT tests in the United States, for every year since 1965. The graph on the right shows the gap between the average income of people living in Mexico and the United States. Look at the huge differences between the two lines in each graph. Men versus women. United States versus Mexico. These graphs seem to show that men are better at math than women, and that people living in the United States have a higher income than Mexicans. And in a sense this is true. It is what the numbers say. But in what sense? To what extent? Are all men better than all women? Are all US citizens richer than all Mexicans?

Let’s get a better sense of the reality behind the numbers. First, let’s change the scale on the vertical axis. Using the same numbers, we now get a very different impression. Now the “gap” seems almost gone.

Now let’s look at the same data in a third way. Instead of looking at the averages each year, let’s look at the range of math scores, or incomes, in one particular year.

Now we get a sense of all the individuals who were bundled into the average number. Look! There is an almost complete overlap between men and women’s math scores. The majority of women have a male math twin: a man with the same math score as they do. When it comes to incomes in Mexico and the United States, the overlap is there but it is only partial. What is clear, though, looking at the data this way, is that the two groups of people—men and women, Mexicans and people living in the United States—are not separate at all. They overlap. There is no gap.

Of course, gap stories
can
reflect reality. In apartheid South Africa, black people and white people lived on different income levels and there was a true gap between them, with almost no overlap. The gap story of separate groups was absolutely relevant.

But apartheid was very unusual. Much more often, gap stories are a misleading overdramatization. In most cases there is no clear separation of two groups, even if it seems like that from the averages. We almost always get a more accurate picture by digging a little deeper and looking not just at the averages but at the spread: not just the group all bundled together, but the individuals. Then we often see that apparently distinct groups are in fact very much overlapping.

We are naturally drawn to extreme examples, and they are easy to recall. For example, if we are thinking about global inequality we might think about the stories we have seen on the news about famine in South Sudan, on the one hand, and our own comfortable reality on the other. If we are asked to think about different kinds of government systems, we might quickly recall on the one hand corrupt, oppressive dictatorships and on the other hand countries like Sweden, with great welfare systems and benevolent bureaucrats dedicating their lives to safeguarding the rights of all citizens.

These stories of opposites are engaging and provocative and tempting—and very effective for triggering our gap instinct—but they rarely help understanding. There will always be the richest and the poorest, there will always be the worst regimes and the best. But the fact that extremes exist doesn’t tell us much. The majority is usually to be found in the middle, and it tells a very different story.

Take Brazil, one of the world’s most unequal countries. The richest 10 percent in Brazil earns 41 percent of the total income. Disturbing, right? It sounds too high. We quickly imagine an elite stealing resources from all the rest. The media support that impression with images of the very richest—often not the richest 10 percent but probably the richest 0.1 percent, the ultra-rich—and their boats, horses, and huge mansions.

Yes, the number is disturbingly high. At the same time, it hasn’t been this low for many years.

Statistics are often used in dramatic ways for political purposes, but it’s important that they also help us navigate reality. Let’s now look at the incomes of the Brazilian population across the four levels.