Correlation vs. Causation: A Handy Guide For Rich People

Hi. My name is Matthew Ciarvella and I’m a member of the middle class. I’m assuming that the majority of people who visit my blog are also middle class(ish), but I don’t really know for certain. On the off-chance that you are reading this blog and you’re a member of The Rich, please pay attention to the following discussion about the difference between correlation and causation, as it seems one of your number (actually, more than one, but let’s just focus on Tom Corley) has tragically confused correlation and causation, thus bringing shame on the good names of The Rich everywhere.

First, the offender: Tom Corley lists 20 things The Rich do every day (the link will take you to a post by Dave Ramsey defending Corley’s list, due to Corley’s site currently not functioning):

1. 70% of wealthy eat less than 300 junk food calories per day. 97% of poor people eat more than 300 junk food calories per day. 23% of wealthy gamble. 52% of poor people gamble.

2. 80% of wealthy are focused on accomplishing some single goal. Only 12% of the poor do this.

3. 76% of wealthy exercise aerobically four days a week. 23% of poor do this.

4. 63% of wealthy listen to audio books during commute to work vs. 5% of poor people.

5. 81% of wealthy maintain a to-do list vs. 19% of poor.

6. 63% of wealthy parents make their children read two or more non-fiction books a month vs. 3% of poor.

7. 70% of wealthy parents make their children volunteer 10 hours or more a month vs. 3% of poor.

8. 80% of wealthy make Happy Birthday calls vs. 11% of poor.

9. 67% of wealthy write down their goals vs. 17% of poor.

10. 88% of wealthy read 30 minutes or more each day for education or career reasons vs. 2% of poor.

11. 6% of wealthy say what’s on their mind vs. 69% of poor.

12. 79% of wealthy network five hours or more each month vs. 16% of poor.

13. 67% of wealthy watch one hour or less of TV every day vs. 23% of poor.

14. 6% of wealthy watch reality TV vs. 78% of poor.

15. 44% of wealthy wake up three hours before work starts vs. 3% of poor.

16. 74% of wealthy teach good daily success habits to their children vs. 1% of poor.

17. 84% of wealthy believe good habits create opportunity luck vs. 4% of poor.

18. 76% of wealthy believe bad habits create detrimental luck vs. 9% of poor.

19. 86% of wealthy believe in lifelong educational self-improvement vs. 5% of poor.

20. 86% of wealthy love to read vs. 26% of poor.

Let’s look at what it means to confuse correlation with causation.

For any two correlated events A and B, the following relationships are possible:

  • A causes B;
  • B causes A;
  • A and B are consequences of a common cause, but do not cause each other;
  • There is no connection between A and B; the correlation is coincidental. (Source)

That’s the basic structure, although there are other permutations.In Corley’s case, he’s doing something a little bit different. Corley is guilty of a reverse causation fallacy. This is a good example and explanation of a reverse causation fallacy:

The faster windmills are observed to rotate, the more wind is observed to be.Therefore wind is caused by the rotation of windmills. (Or, simply put: windmills, as their name indicates, are machines used to produce wind.)

In this example, the correlation (simultaneity) between windmill activity and wind velocity does not imply that wind is caused by windmills. It is rather the other way around, as suggested by the fact that wind doesn’t need windmills to exist, while windmills need wind to rotate. Wind can be observed in places where there are no windmills or non-rotating windmills—and there are good reasons to believe that wind existed before the invention of windmills. (Source)

Thus, Corley’s argument: The Rich are observed to read more, eat better, and exercise more than the poor, therefore reading more, eating better, and exercise cause a person to be Rich.

So if poor people will just not eat junk food or gamble or watch TV or would read more, they will become Rich themselves! It’s so easy! Get ye to the organic produce aisle, poor person!

Can you spot the flaw in Corley’s logic?

Is it possible that poor people eat junk food not because they are gluttons craving sweet, sweet heart disease and obesity, but because junk food is cheap? Or, if you prefer, cheap food is junk. It works either way. If you’re shopping on a poor person’s budget, you’re not going to be enjoying the organic, farm raised produce that costs five times as much. You make that dollar stretch as far as it can and that means frozen food. It means the dollar menu. It means loads of salt, sugar, calories, etc. In short: junk.

But how is it that poor people don’t have time to work out four times a week? After all, it’s not like having a personal trainer or home exercise equipment or a gym membership makes exercising easier, more interesting, or more enjoyable, right? It’s not like a poor person is working a thankless job with brutally long hours for less than a living wage that would leave them without time to exercise, right? If you’re poor, you don’t have a job. You should have lots of free time if you don’t have a job, right? If you had a job, you wouldn’t be poor, unless you’re stupid and fritter away all your money on, I don’t know, drug addiction or gambling or something.

Tom Corley thinks that these good behaviors like reading more, exercising, and eating well are the reason he’s Rich, but that’s the reverse causation fallacy. Much as windmills don’t cause wind, doing these things does not cause Richness. Richness is what allows Tom Corley to have the time and money to do these things, because he does not need to worry about niggling little details like starving to death or getting evicted or having the electricity shut off at the end of the month or paying any dozen of another bills or needs.

If you checked the earlier link to the list itself, Dave Ramsey follows Corley’s list with a long, Christ-laden defense of why Corley is right and everybody who is attacking/mocking/picking him apart is wrong and stupid (my paraphrase). I don’t have the inclination to go through all the ways Ramsey himself is wrong, too, but he does make the same mistake as Corley originally, in assuming that your choices are what make you The Rich. Thus, if you’re not Rich, you made bad choices. Not being Rich, according to Ramsey, has nothing to do with the extensive system of privilege that a person such as Dave Ramsey has enjoyed his entire life, a system that excludes people who do not fall into a narrow band of physical characteristics that cannot be chosen or changed.

There is one final thing I want to mention about Ramsey’s rather silly Christ-wants-me-to-be-rich defense of Corley. Ramsey explains that he, like all the other poor people in the history of ever, was poor once. But then he worked really hard and God blessed his efforts and helped him become The Rich as a reward.

Which, if you think about it, is deliciously ironic. Let’s follow the chain of events:

Ramsey is poor. Ramsey believes in God. God rewards Ramsey by making him into a Rich Person. Jesus says in holy, infallible Scripture-that-is-not-open-for debate-or discussion-or-interpretation-so-don’t-even-try:

And Jesus said to His disciples, “Truly I say to you, it is hard for a rich man to enter the kingdom of heaven. 24“Again I say to you, it is easier for a camel to go through the eye of a needle, than for a rich man to enter the kingdom of God.” (Matthew 19:24)

God has made Ramsey into a rich man even though it’s going to later make it impossible to receive his eternal reward. That’s a dick move, God; making a guy rich just so you can screw him over later.

I’m going to pause with the sarcasm and address this final point directly: if you are rich, it is due to privilege. It might be the privilege of being born into a wealthy family that was able to provide good opportunities and education, or it might be the privilege of the right place, right time, or having a particularly good idea or any number of other confluences. You are not rich because you are a good person; consequently, being rich does not make you a good or bad person. These things are unrelated. You can be a good or bad person regardless of your richness. You might have worked hard for your wealth or it might all be a trust fund and you never worked a day in your life. It doesn’t matter in this context.

It all comes down to privilege. Privilege is what gives some people the choice between wealth and poverty and gives many people the choice between poverty and poverty.

Which is to say, privilege gives many people no choice at all.

One thought on “Correlation vs. Causation: A Handy Guide For Rich People”

  1. Hold on, while you deftly dismantled Corley’s least salient points, I think there are many in there which do seem to suggest causation. Remember, correlation supports the hypothesis of causation, especially if there is a strong model which would include such a relationship.

    For example, there are many points in there related to taking a personal ownership of your education. Education is directly linked with prosperity (thus why affirmative action focuses on increasing access to education), because the more you know, the better you can approach problems, both new and old.

    There are also a lot of points in there about goal setting and personal productivity. Obviously, even if you have a great idea or talent, if you fail to utilize that by focusing your efforts in a structured way, you’ll never achieve success.

    That’s why I take exception to your very very strong statement that “…if you are rich, it is due to privilege.” Because that fails to recognize the others factors that go into economic success. Yes, having privilege can contribute to the number and quality of opportunities a person has, but I don’t think you can fully discount the importance of a person’s mindset to how those opportunities turn into reality. I think we all know people who would go broke a week after winning the lottery or who could never build a company, no matter how much starting capital they had.

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