Grading PolitiFact: Michael Bloomberg and financial sector pay

New York City mayor Michael Bloomberg has joined President Obama in PolitiFact's exalted "artful" class.  Let's dig in!

The issue:

 

The fact checkers:

Louis Jacobson:  writer, researcher
Bill Adair:  editor

Analysis

As usual, we go to the context as the first order of business.  Bloomberg's remarks occurred on "Meet the Press," so NBC had the transcript:

MR. GREGORY:  We're still talking about the, he economy more broadly, and I want to show something that Jeffrey Immelt--who is the CEO, of course, of General Electric, the parent of NBC--said about this, this era of business leadership on Wall Street that's coming to a close.  This is what he said. "We're at the end of a difficult generation of business leadership.  ... Tough-mindedness, a good trait, was replaced by meanness and greed, both terrible traits.  ...  Rewards became perverted.  The richest people made the most mistakes with the least accountability."

Mayor Bloomberg, has that era ended?  Is Wall Street a different place?

MAYOR BLOOMBERG:  I don't know that Wall Street's a different place, but what's happened in this country from an economic point of view is we went through another one of these cycles.  And we keep forgetting that we've been through this again and again and again.  We slowly build, we go to excess, it gets corrected overnight, we yell and scream, gnash our teeth, swear never again and then we start the same cycle.  The markets will work, and anybody that thinks they can hold back the markets is just making a mistake.  We live in a global world.  We don't control the whole world.  We cannot write regulation that's inconsistent with the rest of the world, because things will move around.  The governor talked about education being jobs.  Education is crime on our streets, education is our tax base.

MR. GREGORY:  Mm-hmm.

MAYOR BLOOMBERG:  You know, we have--everybody is bashing Wall Street.  That is one of the big revenue generators for New York and New York City.  That's how we pay our teachers, that's how we pay our cops, that's how we pay our firefighters.  And I've always thought, if the elected officials in Michigan bashed the automobile industry, or in California, I.T., or in Texas, oil, they'd be run out of town on a rail.  And yet, every day I pick up the paper and everybody, it's kind of hard to find anybody that's not saying--well, look, there are some excesses.  But overall, most of the people that work in finance make $70,000, $80,000 a year, they're hardworking, and we want those industries to be here and not overseas.

I do wish to credit PolitiFact writer Louis Jacobson with providing a fair amount of context in the story.  I included an exchange preceding the one Jacobson quoted because it reinforces the context in which Bloomberg's remarks were framed.  That is, at least in part, the assertion that financial sector jobs need not remain in New York if the regulatory climate is better elsewhere.

Now to Jacobson's treatment of Bloomberg's statement:

The part that caught our eye was that "people that work in finance make $70,000, $80,000 a year." Many of us have the impression from the media that people who work on Wall Street earn much more than that. So we talked to experts and looked at the data.

That seems fair.

The mayor's office referred us to the New York City Economic Development Corp., whose head is appointed by the mayor. A spokesman said that office came up with that figure by using the U.S. Census Bureau's American Community Survey data. We consulted with the Census Bureau on retracing their steps and found that Bloomberg's comment on Meet the Press was indeed accurate.

Wow!  That was easy.  Jacobson spends the next six paragraphs explaining why Bloomberg was accurate, mentioning along the way that American Community Survey data show that the median income for workers in the financial/insurance sector in New York City is within the range cited by Bloomberg:  $78,451.

So Bloomberg gets a "True" ... or does he?

The other key question is whether the data sets the mayor used are justified or misleading. The census data (as well as BLS data) count anyone who works for a financial firm, regardless of what their job is. A receptionist, an IT staffer, a janitor -- as long as they're employed in-house by a financial services firm, they get mixed in with the high-rollers that author Tom Wolfe called the Masters of the Universe. The receptionists and janitors tend to decrease both the median and average earnings figures for the industry.

Was Tom Wolfe interviewed for this story?  Where did that come from?

PolitiFact often considers the "underlying argument" with respect to statements it rates.  It is certainly fair to examine any underlying argument presented by Bloomberg in his televised comments.  In context, Bloomberg allowed that excesses occurred and probably continued to occur on Wall Street, but cautioned that harsh regulation might make the financial sector and the associated jobs go away.  The threat of losing those middle class jobs, I think, seemed to most likely represent Bloomberg's underlying argument.

How does Jacobson see it?

Bloomberg's artful wording -- "Most of the people that work in finance make $70,000, $80,000 a year" -- was broad enough to include lower-paid employees. And because of that, it is backed up by a credible federal statistic. But we believe a reasonable person hearing his comment would think he was saying that professionals such as bond traders and brokers earn $70,000 to $80,000 per year. So while he may be technically accurate, we find his statement misleading.

Even in the context of the potential loss of financial sector businesses a "reasonable" person might think Bloomberg was talking about professionals only?  What kind of reasonable person ignores the context like that?

I can only imagine that Jacobson considered Bloomberg's statement out of context, and even then the PolitiFact writer concedes that Bloomberg's wording "was broad enough to include lower-paid employees."
And what of "But overall," and "we want those industries to be here and not overseas"?  "Overall" and "those industries" provide no clue to the "reasonable person" that Bloomberg wasn't referring exclusively to professionals?

Once again, I am amazed at PolitiFact.

The grades:

Louis Jacobson:  F
Bill Adair:  F