Monday, August 8, 2011

Not One Pretty Picture

A basic rule of neuroscience is that the more visual the input is, the more likely you (your brain) are to recognize and recall it.  This phenomenon is called the Pictorial Superiority Effect, or PSE.  There is a good description of this in the book,  Brain Rules by John Medina,  that I read a couple years ago.
Text and oral presentations are not just less efficient than pictures for retaining certain types of information; they are way less efficient.  If information is presented orally, people remember about 10 percent, tested 72 hours after exposure.  That figure goes up to 65 percent if you add a picture.

Human PSE is truly Olympian. Tests performed years ago showed that people could remember more than 2,500 pictures with at least 90 percent accuracy several days post-exposure, even though subjects saw the each picture for about 10 seconds.  Accuracy rates a year later still hovered around 63 percent.
If you are still having a difficult time in grapsing our federal budget situation, here are a four pictures that tell the story without the need for a lot of words.  The first two charts were published in The Big Picture.  Bud Conrad from Casey Research is the source for the third chart and The Heritage Foundation produced the fourth chart.

The red line below is what we are spending.  The blue line is what we are collecting in revenues.  The gap between the lines is our federal budget deficit.  The shaded areas are recessionary periods.

The next chart shows what we are spending and what our revenues are as a share of the economy (GDP).  The red line is the share of federal government spending.  The blue line is the share that revenues represent of GDP.

You can see from this chart that since 1970 (outside of recessions and the boom that resulted in large capital gains driven revenues in the late 1990's), revenues have generally been between 18% and 19% of GDP no matter what the income tax rates were.  They were as high as 70% in the 1970's and as low as 28% in the late 1980's under Reagan.  This is why this seems to be a logical level for detemining what we can afford as a nation to be spending on federal government services-between 18% and 19% of GDP-with 20% as the outer limit.

The final chart shows the effects of the debt limit deal signed by President Obama earlier this week. The red columns represent projected spending.  The blue shows the projected reductions in spending for each year in the agreement.  This does not include the $1.5 trillion in projected in deficit reduction from the Select Committee that is supposed to be voted on by December 23.  How much is the $1.5 trillion as a percentage of projected spending over the next 10 years?  About 3%!  The work of this Commission is going to be portrayed as extraordinarily difficult.  Does this look tough? 

The last "picture" is from The Heritage Foundation and shows the projected rise in entitlement spending on Social Security, Medicaid, Obamacare subsidies and Medicare compared to average tax revenues as a % of GDP.  Is it any wonder U.S. debt has been downgraded when there is so little political will to do anything to address this problem?  Paul Ryan and the Republicans have tried.  President Obama and the Democrats need to get serious. 

I hope that you can bring these images to mind the next time you vote.


1 comment:

  1. Pictures are very effective in presenting. Remember the impact Ross Perot made with his flip charts and graphs. Also, made for some good SNL skits.