Wednesday, November 15, 2006

Post hoc ergo propter hoc

Post hoc ergo propter hoc - it's a fallacy, logically speaking...a technical flaw which makes an argument unsound or invalid.

The fallacy of Post Hoc Ergo Propter Hoc occurs when something is assumed to be the cause of an event merely because it happened before that event. For example: "The Soviet Union collapsed after instituting state atheism. Therefore we must avoid atheism for the same reasons."

Most people will see that these two issues, state atheism and the fall of the Soviet Union, are not causational. The practice of atheism did not, solely, result in the fall of the USSR.

Another example of this would be: "Maggie Thurber was elected County Commissioner and since that time, unemployment in Lucas County has declined." No one, including me, would say that my election caused the unemployment rate in the county to fall. But we seem to accept this fallacy when it comes to other issues.

Why do I raise this point? It's because of the false belief that building an arena will result in an economic boom in this area, simply because other communities who've built arenas have seen improvements. Today's Blade article on last night's arena public forum starts with this:

"Until the arena came along, the business core of Grand Rapids, Mich., struggled. Storefronts were boarded up.

Today, 10 years after the Van Andel Arena was built, the mid-sized city in western Michigan claims that it's competing with Detroit.

That was the comment Richard MacKeigan, general manager of Grand Rapids' Van Andel Arena, had for a public hearing last night on Lucas County's proposed arena.

Mr. MacKeigan, who works for SMG, a national arena operator based in Philadelphia, which is bidding to be the Toledo arena operator, said Toledo would have a similar experience."

To suggest that the Van Andel Arena (opened in October 1996) is the reason that storefronts are no longer boarded up is a prime example of the post hoc ergo propter hoc fallacy. It ignores other such factors whose impact is signficantly greater than the building of arena - factors like educational level of the workforce, tax rates, sales taxes, population, per capita income, business climate, etc.

Just compare the census date of Grand Rapids to Toledo. You'll see that, from 1990 to 2000, GR had a population increase of 4.3% while Toledo's population decreased 5.8%. Almost 28% of GR's population has a bachelor's degree or higher compared to Toledo's rate of 16.8%. Median household income in Grand Rapids is about $5,000 higher than Toledo's. Toledo has 17.9% of its population below the poverty level compared to GR's rate of 15.7% Retail sales per capita in GR are about $2,000 more than in Toledo.

When you get to County data, some of the figures are even more disparate. Kent County's population increased 14.7% from 1990-2000 while Lucas County's population declined 1.6%. Kent's median household income in 2003 was about $7,000 more than in Lucas.

Additionally, the hotel-motel taxes in Grand Rapids are, according to the gentleman from last night, 12% versus our current rate of 14.75%.

But the arena is not the only area in which such fallacious arguments are used...just look at the rationale regarding the recently-passed minimum wage hike. Policy Matters Ohio used a study from the Economic Policy Institute which said that states which raised the minimum wage didn't see a decline in employment. Again, this argument presumes that no other factors contributed to the employment situation - and declines to consider whether or not employment might have increased by MORE than it did had there not been a hike in a minimum wage.

There's a lot of debate we can have on such issues and policies. But if we want to improve the quality of our debate, we must be capable of spotting invalid arguments and rejecting them - otherwise, we'll find ourselves facing the consequences of bad decisions.


Rusty said...

Grand Rapids redeveloped because the DeVos family (Amway) threw money at it right and left.

Toledo will not have a healthy economy until the "rustbelt" region has a healthy economy, which will likely be a generation or more.

Sorry for the pessimism, but it is what it is.

Maggie said...

Rusty - there are a lot of people who agree with you...

So I guess the next question would be - does an arena lead to a healthy economy or does it thrive because of a healthy economy...

Rusty said...


I suppose you can have a healthy arena in a saggy economy, but a healthy arena does not create a healthy economy or even a healthy downtown.

And a saggy economy makes the arena a risk at $80m.

Hooda Thunkit (Dave Zawodny) said...

Maggie, you make way too much sense.

So, if and when the arena fails to change Toledo/Lucas County's fate, which get rich quick scheme du jour will the politicians hitch their wagon to next?

And, how will they then misinterpret again what it takes to get the local economy moving?

Seems to me that common sense isn't really common, now, is it?

Maggie said...

Hooda - you and I have had this discussion before...we agree that common sense is very rarely 'common.'

But the local governments continue to build major projects with the idea that they will stimulate the economy - failing to recognize that government costs are a significant factor over which such elected officials have control...unlike the housing or retail markets...and reducing the costs of government will have a more positive impact on our economy than any 'development' government does.

But don't these projects look nice and sound nice on a lit piece when it comes to elections? Smoke and mirrors - style over substance....

Kate said...

This was a thought provoking post Maggie. IMO - the arena and some of the other growth projects CAN work together to form a more enticing community to both residents and business.

However, I'm hard pressed to come up with another community who headed a successful arena project with the local government handling the build. The more successful projects have been driven by private industry and professional sport sponsorships SOMETIMES with a request for tax payer support. Retail builds retail best. Tell me when government EVER built anything efficiently or got involved in buying things and costs went down?

Last thought - I do not like the way the arena project is being handled at all. At the heart of that is a glaring disconnect in logic.

To build an arena to entice visitors to come and stay in the area (and drop money into the local economy) the plan is to make this the third most expensive place in the country to get a hotel room?

I want somebody explain that one to me. They want to bring tourists here with an arena and to pay for the arena they make the tourist environment cost prohibitive?

Anonymous said...

Kate brings up a point that I'd not heard yet, but often thought of myself: Why does the county gov't -- or any gov't entity -- need to get involved with the arena?

Shouldn't that be the responsibility of the Toledo Storm, or other business enterprise?

I'm sure the county and city can lend a giant hand to help an entrepreneur scout, plan and build an arena, but it should only be assistance. Not the driving force.

We often hear about the core responsibilities of the federal gov't (national defense, etc.). But, isn't an arena outside the core duties of a county gov't?


Maggie said...

Bingo, Mike!!!!

I can tell you that the explanation that I was given, as well as the one that has been given publicly, is that private entities aren't doing arenas, so if we want one, government must do it. My response is that Nationwide Arena in Columbus was done privately - and many of the most recent arenas are being done by private organizations. Cities are now saying 'no' to teams who want the taxpayers to foot the bill for a new arena.

But why should any team or private entity want to step up to the plate when government officials are falling all over themselves to front the money? Any savvy business person would just sit back, let the taxpayers pay for everything and then take advantage of the new facility. Bad policy, IMHO.

As for this one, I said that before we start with a study about the financial feasibility, we should first decide if it's a priority over all of the other issues we face - issues that are mandated functions of county government - like a jail! Which, btw, is releasing prisoners on a daily basis because of lack of space to house them - said prisoners then fail to appear for the court cases, get bench warrants, get re-arrested, get released and fail to show up in court...vicious cycle and a safety issue for our community.

But, the plans for a new jail have gone by the wayside...even the Sheriff, who originally said a jail was the highest priority in the county, has fallen in line with his fellow democrats and now doesn't think he needs a new jail - which leaves the commissioners free to pursue an arena as a major building project.

I want a new arena - I just don't want the county to build it, finance it, run it, etc. I do believe that any PRIVATE group who wants to build an arena should be eligible for the same government assistance as any other major building project - like road improvements, water/sewer services, etc...

Now, Mike, if we can just get more people asking this question and demanding an answer from the other two commissioners....

Hooda Thunkit (Dave Zawodny) said...


Sadly, the only thing that I can add to your response is Amen...

Rusty said...

Those of us who remembering the ground breaking for Portside have to be skeptical.

And the convention center is too small for large conventions or athletic events of any size, hey that was smart.

Granted, the Sports Arena is a pit in a dumb location (traffic wise) but perhaps a decent renovation would hold us for a decade or so, tied to the rest of the water front development.

Unknown said...

Two reasons come to mind why private businesses are not interested in building an arena.

a) If the County does it they don't have to or

b) They don't feel it can make a profit here else they would build it.

Granted there are additional factors but those are the two that come to mind every time we talk about that aspect of it.

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