Don't be suckered into thinking a graph must be true because it contains data and that data doesn't lie. The Drum's own graph enthusiast Greg Jericho outlines the tricks and manipulations to look out for.

This election year one key battleground has been Facebook. And rather interestingly for those who like data, one of the main weapons used has been graphs.

While you might think this is a good thing, the problem is that while graphs can be a wonderful means of explaining data, not all graphs are honest representations of data.

As with scripture, the devil can cite data for his own purpose, and certainly both the ALP and Liberal Party have been doing that.

The graphs used by the parties on Facebook are quite often not even represented as advertisements. In an attempt to suggest they are unbiased, they often lack any party identification, but they still contain a fair amount of distortion and propaganda.

The trouble for those seeing these graphs being shared by friends on Facebook (one of the ALP's graphs has been shared over 12,600 times) is to not be suckered into thinking a graph must be true because it contains data and that data doesn't lie.

In reality, the best way to make data lie is with a graph.

Edmund Tadros at the Australian Financial Review has been doing some nice work fact-checking some of the graphs, and while that is a good service, there are a few tricks which can alert the viewer that some major graph crimes are occurring.

The first thing is to be aware of what the party is trying to highlight.

As a general rule when it comes to the economy, the Liberal Party wants only to compare Australia with the past - ie the time during the Howard government. The ALP on the other hand, realising that the GFC pretty much busted any chance for things like GDP growth and debt to be better than in the mid-2000s, prefers to compare Australia with other nations.

When looking at the past, the Liberal Party likes to graph things like debt or taxation revenue in nominal dollar amounts rather than as a percentage of GDP. This is because doing so makes the current amount seem bigger because it doesn't take into account inflation or other factors that might be relevant such as the size of the economy.

They also like to use a short time scale to distort the picture.

Take for example its latest Facebook graph on government revenue:

Graph 1: Government receipts small ( Greg Jericho )

Click image for larger version.

By starting at 2007-08 the graph implies that the first four years to 2010-11 are almost normal - ie tax revenue is generally flat, or falls a bit. However, as I noted last week, 2008-09 and 2009-10 were two of only three years in the past 42 years where tax revenue went down. Thus this graph renders the extreme as normal.

Another sign that things are dodgy is the scale on the vertical axis. When a graph doesn't start at zero it exaggerates. Often economists will do this to, in effect, go in for a close up, but when political parties do it, you can bet it is done to distort.

So, we have a poor time scale, distorted vertical scale and use of nominal dollars that exaggerates current revenue.

Were we to show this same graph using the more honest measure of total revenue as a percentage of GDP, but also used a vertical axis that doesn't start at zero and shifted the time scale to highlight the impact of the GFC (and go back to the year in which the Howard government raised its most revenue as a percentage of GDP) we could come up with this:

Graph 2: Government receipts extended small ( Greg Jericho )

Now such a graph is only slightly less dishonest. Percentage of GDP is the better measure, but the scale and time periods are still distorted for propaganda effect.

It highlights however, how easily graphs can skew facts.

At least the Liberal Party's graph contains a citation. A number of ALP Facebook graphs fail to say where their data comes from.

Take a look at its graph on government debt across the world:

Graph 3: Current government net debt small ( Greg Jericho )

Now there is little wrong on the surface with this graph. Using per cent of GDP to measure debt is an honest way to do so, but where is this data from? Is "current" 2012 or earlier? The OECD Statistics only have the data for central government debt up till 2010, but they don't include San Marino, which suggests this comes from the IMF world economic outlook database.

But the mix of countries, as economist Saul Eslake noted in the AFR, leaves out nations that are performing better such as Sweden and Norway.

The inclusion of San Marino is odd and I think just a data flub because it is the only one on the graph not included in the IMF's list of "advanced economies". So let's leave that out, but put in Norway, Finland and Sweden:

Graph 4: Government net debt expanded ( Greg Jericho )

Here Australia doesn't look as rosy as in the first graph, but Norway's sovereign wealth fund rather skews the graph because it is so out of whack with the rest of the world.

It's clear why the ALP left out the three Scandinavian nations, as doing so certainly highlights better our low debt levels. But even on this more honest graph, it remains clear our position is a long way from the UK or USA let alone the horrors of Greece to which some politicians would have us compared.

But the ALP doesn't get off with only a slight eyebrow raise. When it wants to show increased expenditure on certain areas, it is only too happy to use the Liberal Party trick of nominal dollars. When it tried to show that higher education funding will increase despite budget cuts it used this graph:

Graph 5: Higher education expenditure ( Greg Jericho )

Again the ALP forgets to tell us the data source, and as with the Liberal Party's revenue graph it doesn't consider inflation, nor growth in student numbers (something noted by Mark Bahnish on the Larvatus Prodeo blog).

Soon after it posted a graph which put the amounts in real dollar terms and also on a per student basis:

Graph 6: Real per student spending on unis ( Greg Jericho )

Now this graph is more honest, although extending it out to 2017 rather hides the crucial decline in funding in 2014 that will occur due to the "efficiency dividend".

But what the graph also ignores is the state of Commonwealth and student contributions compared to earlier times. The Higher Education Base Funding Review Final Report released in December 2011 has a graph which shows funding going back to 1989 and also splits Commonwealth funding from student contribution (ie HECS)

Graph 7: Income per Commonwealth supported place small

Clearly total income per student is now higher than almost any time, but clearly as well, that is due to HECS and student contributions rather than government funding, which is well below the levels of the early 1990s.

The moral of this all is that when a friend starts sharing graphs on Facebook, ask yourself what the graph is trying to highlight, and what it is failing to show. Think about the time period used, the measurements used and be sceptical.

And always remember, graphs aren't always the whole picture, let alone the whole story.

Greg Jericho writes weekly for The Drum. His blog can be found here. View his full profile here.