It’s a scary, dismaying headline that made the social media rounds over the past few weeks: “Nearly 25% of Americans are going into debt trying to pay for necessities like food.”
The piece, which appeared on CNBC, began with the following:
“American have an average of $6,506 in credit card debt, according to a new Experian report out this week. But which expenses are adding to that balance the most? A full 23% of Americans say that paying for basic necessities such as rent, utilities and food contributes the most to their credit card debt, according to a new survey of approximately 2,200 U.S. adults that CNBC Make It performed in conjunction with Morning Consult. Another 12% say medical bills are the biggest portion of their debt.”
The piece goes on to state that “day-to-day costs continue to soar. Middle class life is now 30% more expensive than it was 20 years ago,” people are just scraping by, and so on. It’s all suitably dismaying and feeds the narrative of the growing divide between the rich and poor. The overall tenor is about right: many people are living on the edge of poverty.
But hold on—What about the scary headline? Where does that come in?
In this case we see that the headline and accompanying chart title refer to “Expenses that lead to debt.” However the caption below contains the important information: “CNBC Make It, in conjunction with Morning Consult, recently asked 2,200 U.S. adults which of the following would you say most contributes to your credit card debt.”
Careful readers—or, really, anyone reading above a fifth-grade level—might notice that the headline and the question asked are talking about two different things. The article headline and chart headline refer to general “debt,” while the question asked specifically refers to “credit card debt.” Credit cards may make up a significant portion of a given person’s debt, but are only one source of many.
The question is less about “Expenses that lead to debt” but instead “Expenses that people choose to put on their credit cards.” Most of the expenses (dining out, transportation, groceries, entertainment, child care, etc.) could be (and likely sometimes are) paid some other way, such as by check or cash. In this sample of 2,200 adults, these just happen to be the expenses they decided to put on their credit cards, and if they didn’t pay off the full amount in the last billing cycle, it became “credit card debt.” This doesn’t really suggest—as the headline does—that people are going into debt to pay for these expenses.
It’s also noteworthy that by far the most common expense (at 32%) was discretionary spending: going out to movies or concerts, eating at restaurants, buying video games, and so on. Nine percent said that travel most contributed to their credit card debt, likely because of the cost and ease of paying for travel with a credit card. Given that there’s a separate category for transportation (i.e., commuting costs) it’s likely that much of the travel costs are also discretionary—vacations, cruises, and so on. (Who knows what the 16% of expenses encompassed by the categories “Don’t know” and “Other” include.)
Instead of the results suggesting that “nearly 25% of Americans are going into debt trying to pay for necessities like food,” the survey sort of suggests the opposite: that most Americans have enough money to get by, buy nice things for themselves, travel, and so on. The fact that 23% of Americans say that necessities like rent, utilities and food most contributes to their credit card debt isn’t particularly shocking or alarming. In a truly impoverished country, the number would likely be twice or three times that.
To be clear: The fault is not with the poll methodology; it seems perfectly valid and sound (see below for a closer look at the question and demographics).
Instead the error lies with those responsible for accurately translating poll results into news stories—in this case the CNBC journalist was sabotaged by her editors, who supplied a flawed, sensationalized, and misleading headline to an otherwise factual, well-reported story. The article’s advice on how to reduce credit card debt is valid and useful (paying off higher-interest cards first, paying the balance in full when you can, etc.), but the survey that forms the basis for the headline isn’t particularly accurate or relevant.
As noted, the survey is less a snapshot of why Americans are in debt than it is of what expenses people put on plastic instead of paying by some other method. Similar results, for example, could have come from asking people what expenses they paid for by cash or check; the only difference is that credit cards, by their nature and design, carry debt.
I have written many media literacy articles, and a recurring theme in news articles based on research, polls, and surveys is the importance of reading what the poll or survey question actually asked. From Holocaust denial to the belief that Native Americans don’t exist, journalism is rife with misread and mangled statistics. Never assume a headline accurately reflects what a poll or survey says. Always skim the article to find the actual, original question that was asked; any responsible piece of journalism should include it. If you feel so inclined, spend a minute or two to find the original source from the polling organization or journal article.