Between 2015 and 2021, IRS audits completed declined while Alibaba Singles Day sales grew, producing an inverse correlation of -0.9643 across seven data points. The reading that Chinese e-commerce growth is directly undermining American tax enforcement has the paranoid energy of a congressional hearing, but the numbers are right there: as Singles Day revenue climbed to $85 billion, the IRS was auditing fewer Americans than at any point in modern history. Seven data points is not enough to prove that Jack Ma destroyed the audit function, but it is enough to make a chart that looks like he did.
IRS audits declined from roughly 1.2 million in 2015 to under 700,000 by 2021 due to sustained budget cuts and staffing losses. Alibaba Singles Day sales grew from $14 billion in 2015 to $85 billion by 2021, driven by Chinese consumer spending and platform expansion. Both trends reflect institutional trajectories in different countries—one of public sector austerity, one of private sector growth—that happened to move in opposite directions across a window too short for statistical significance.
Seven data points of two trends in opposite directions will always produce a strong inverse correlation. The IRS and Alibaba share nothing except a calendar and a mathematician willing to compare them.
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Want to learn more about why correlations like “IRS audits completed” vs “Alibaba Singles Day sales” don't prove causation? Read our guide to statistical thinking.
