Is that it?

Iconic Houses

Frequently we criticize reporters for ignoring or obscuring the role religion might play in stories about socio-economic trends. But here’s a case where a reporter led with the religious angle when looking at a new report that shows that Utah had the fifth-highest foreclosure rate in the nation.

Apparently 1 in 231 homes there received a foreclosure notice in January, nearly double the national rate. The story says that explaining why Florida, Nevada, Arizona and California had even higher foreclosure rates is straightforward — home prices more than doubled since 2000 and then real estate values dropped precipitously. But Utah home prices only rose half that much, the story says. So what’s the deal with Utah, according to the Christian Science Monitor?:

“It’s a lot of younger people who spent way, way beyond their means, absurd amounts of money trying to keep up with their folks,” says one Utah resident who helps counsel financially troubled families at his church. They’re “cool, nice, wonderful people, but an awful lot of them don’t know how to spend money very wisely.”

In mid-decade, when Utah was tops in bankruptcies, various commentators pinned the blame on Mormon religious and cultural practices, such as tithing, creating large families, buying homes at a young age, and as one critic put it: “the pressure in Mormonism to be, or at least appear, financially successful as proof the Lord is blessing them.”

Indeed, Mormons in 2004 had a bankruptcy rate that was approaching twice that of the national average. But a 2007 study by two Harvard Law School graduates found that rates among non-Mormons in Utah were even higher, suggesting that religion, if anything, was restraining bankruptcies.

First off, what’s the deal with not giving the person in the first quote a name? And does he speak only to experiences in his own unidentified congregation or do we have reason to think his explanation is applicable more broadly? And if you’re going to suggest that the foreclosure ranking is caused by Mormons, you have to base it on much more than a nameless quote and no data. And when data is brought into the equation, it doesn’t exactly support the thesis either.

Also, the way that reporter Laurent Belsie won’t identify sources is frustrating. It’s good to know, I guess, that two graduates of a particular law school studied the issue of bankruptcy in Utah. But who was the study for? Which peer-reviewed journal published it, if any? If someone wants to find out more information, rather than taking the reporter’s word about what the study says (something I try not to do!), what do we do?

And wouldn’t it be nice to know what percentage of Utah is Mormon and what percentage of that group is practicing Mormon? I’m not asking for a full blown regression analysis, but if you don’t know enough about the difference between correlation and causation to look into a few of these issues, you really shouldn’t be speculating on all this.

The rest of the story comes up with other explanations, including low wages, high medical costs, large number of bankruptcy filers with at least one dependent child, large family size, garnishment laws, repeat bankruptcy filers and something called “the effect of having a large proportion of young, middle-class people earning $30,000 to $60,000 a year.” I’m not even sure half of these things are true but needless to say, they are really poorly explained.

Also, I have to mention the headline for this piece:

Foreclosure mystery: Why can’t conservative Utahns afford their mortgage?

Now, certainly Utah as a state tends to vote conservatively but that doesn’t mean that everyone in Utah is conservative. We don’t know whether there is any correlation between the political or social views of a given Utahan and their propensity to foreclose on a property. For all we know, only liberal or moderate Utahans are foreclosing. That headline goes so far beyond what the original report looked at that it’s laughable.

It’s a good instinct to look at possible correlations between religious views and social trends. But if you’re going to do it, I think it needs to be done a bit more thoroughly than we see here.

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  • Martha

    “the effect of having a large proportion of young, middle-class people earning $30,000 to $60,000 a year.”

    So are those considered good wages by American standards? Or low for the middle-classes? Or what?

    If they are good wages, then maybe the people earning them thought they could afford bigger houses and more expensive goods. If they’re bad wages, then does that mean that people were living beyond their means in an attempt to aspire to a status beyond them – which is what the piece seems to be saying, or trying to say: too many people trying to keep up with the Joneses.

  • Dave

    if you don’t know enough about the difference between correlation and causation to look into a few of these issues, you really shouldn’t be speculating on all this

    If the MSM collectively ever figured this out, it would be wonderful. (Maybe they could then explain it to the pundits and even the politicians…)

  • Jettboy

    Hey, its Mormons. We all know that in Utah especially anything good happens its the Mormons and anything bad happens is unquestionably the Mormons. Anyone remember the most unhappy in U.S. report said it was the Mormon’s fault and then when another report showed that Utah was among the most happy it was the outdoors types fault? I know people will say I have a persecution complex; but its so easy to point to things like this to have it confirmed.

  • Jerry

    Finding bad science reporting is even easier than finding bad religion reporting. And, of course, there should have been an editor involved here as well. I am a bit surprised that this is from the Christian Science Monitor so I wonder if it’s a rare clunker or a sign of things getting worse.

  • dalea

    The author seems to have troubles with statistical reasoning. Like not clearly understanding it. What struck me is that there is no mention of the cost of living data for Utah. If we knew that, we could understand if the reported 30 to 60K income is a manageable income for the locale. (Martha, the US average income is about 50K; the reported figure is on the low end of average which can be magnified in a high COL state.) Also left out is that the InterMountain West tends to have a boom and bust economy. This could be a factor.

    Also left out is just where in Utah this is happening. Is it everywhere? SLC? The desert areas in the south? Statewide numbers frequently need to be broken down for clarity.

  • Tracy Hall Jr

    Here’s the link to the 2007 Study: “Are Mormons Bankrupting Utah? Evidence from the Bankruptcy Courts,” by Ezekial Johnson and James Wright, Suffolk University Law Review, 40, 2006-2007.

    The authors surveyed 281 individuals who appeared at the mandatory “341 meetings” for debtors in bankruptcy with a form that asked for their religious affiliation as well as their the strength of their commitment to their religion and the amount they contributed to it. They found that while Mormons make up approximately 62.4% of Utah’s population, they only constitute 61.3% of debtors in bankruptcy. They specifically analyzed their data for a number of supposed characteristics of Mormon culture that have sometimes been blamed for Utah’s high bankruptcy (tithing, number of children, age) and found no correlations. Job loss and medical bills were the significant factors, with a possible tie between job loss and inadequate health insurance, with more Mormons reporting these as reasons than non-Mormons.

    The Monitor could have done a better job of summarizing the study and should at least have provided a link to it.

    A more recent study found that the most likely reason that Utah has a high rate of bankruptcy is because under Utah law, creditors can easily garnish a debtor’s wages. In “Explaining the Puzzle of Cross-State Differences in Bankruptcy Rates,” The Journal of Law & Economics, vol. 52 (May 2009), Lars Lefgren and Frank McIntyre of Brigham Young University analyzed 28,000 bankruptcies in all 50 states from 1999 to 2000 and found that “the best predictor of a state’s filing rate is that state’s wage garnishment law. Some states have laws that make it more difficult for creditors to dip into a delinquent debtor’s paycheck. These states tend to have lower bankruptcy rates.

    It’s a pity the Monitor didn’t do a more thorough search to locate the later study.

    Tracy Hall Jr

  • Becca

    Tracy, thanks for bringing up those studies. My brother-in-law is the lead author on the most recent and I was going to mention it in the comments. I know when he first became interested in the topic he thought Mormonism probably did factor in to the high bankruptcy rate in Utah, but his research proved otherwise. I’ll encourage him to look into foreclosures as well!