Trump, the BLS, and Our Age of Choose-Your-Own-Reality Governance
The president's war on economic data will make us dumber, poorer, and less prepared for crisis
On Friday, Donald Trump fired the head of the Bureau of Labor Statistics for reporting that the US economy is adding fewer jobs than the president would like.
The BLS is widely regarded as the most trustworthy source of economic data in the United States. Its surveys provide the official unemployment rate, along with job growth figures, wage growth, inflation, productivity, and other critical economic data. To politicize the BLS is to destroy the public’s trust in the government to tell basic truths about the economy.
The history of firing bureaucrats for reporting inconvenient statistics is a long and troubling one. Mao Zedong castigated his general Peng Dehuai in 1959, after Dehuai wrote a private letter pointing out that Mao’s Great Leap Forward was causing one of the worst famines of the 20th century. For the sin of stating the obvious to a thin-skinned dictator, Dehuai was fired, relocated, and stripped of his military honors.
The clearest echo of last week’s move, however, doesn’t come from China, but rather from a neighbor to the south. Twenty years ago, Argentina’s economy was floundering as it emerged from an economic crisis. Inflation surged above 12 percent. The president didn’t like that number. So he pressured the staff of the National Statistics Institute to change the way they calculated inflation to make the number go down. The pressure campaign didn’t work. So, in February 2007, with inflation still above 10 percent, the president fired Graciela Bevacqua, the official in charge of calculating the consumer price index. The institute’s director resigned soon after.
And wouldn’t you believe it: Argentina’s official inflation statistics magically declined! The government-reported monthly inflation rate fell by more than 50 percent between January and February 2007 and continued to trend down. On paper, the inflation crisis was over. But while numbers live on paper, people do not. They shop at grocery stores, malls, supermarkets, and restaurants, and the prices at all those places just kept rising. Independent measures of prices and “perceived inflation” soared in Argentina, even as the government’s official figures said the country’s inflation crisis was ending.
Everybody knew Argentina’s official inflation numbers were made up and meaningless. Several international news organizations just stopped reporting them. But the consequences for Argentina were worse than a hit to their reputation. Argentina's nonsense stats led the country to over-estimate GDP growth, under-estimate poverty, and consistently suppress the year-over-year growth of all wages and pensions pegged to the inflation rate.
The Argentina lesson for the United States is clear. At the national level, lying to yourself will make you poor. You can run from economic reality. But you can’t hide.
The War Against Reality
Job growth isn’t the only inconvenient statistic that the Trump administration has tried to suppress in its first seven months.
In April, the Trump administration dismissed hundreds of experts who had been putting together the National Climate Assessment, an official report on climate change that is required by Congress. This report isn’t just bathroom reading material for folks who care about sea levels. State and local governments use it to allocate funds toward possible extreme weather events. The insurance industry relies on the assessment to assess risk from extreme weather events for reinsurance coverage. But since the administration is busy waging ideological warfare against any idea that seems too progressive, climate change reports got swept up in the mass cancellation of inconvenient data.
Then in June, Robert F. Kennedy Jr. fired all 17 members of the advisory committee on immunization to the Centers for Disease Control and Prevention. The board “[reviews] data on vaccines, debate the evidence and vote on who should get the shots and when,” as the New York Times reported. Vaccines recommended by the panel are required for government insurance coverage. But Kennedy, a longtime skeptic of vaccine effectiveness, used his position to gut the committee responsible for assessing vaccine safety so that he could install his own regime of vax skeptics in its place. Once again, independent expertise was expelled to make room for the administration’s preferred message.
Across government, Trump administration is commandeering independent agencies to turn them into mouthpieces for pro-Trump narratives, across climate, health, and the economy. The White House is trying to program reality as if it were reality TV.
But reality exists, whether or not you choose to measure it. Argentina learned this lesson the hard way, making up nonsense inflation statistics that satisfied the ego of its leaders while slowly impoverishing its people. Overturning America’s economic methodology in order to avoid upsetting the president’s tetchy sensibilities presents a massive risk—first, to the economy; and second, to the values of liberal democracy, itself.
While Trump messes with the BLS, the US economy is showing strains of weakness. Outside of the pandemic, the unemployment rate for college graduates over 25 is rising fast and is higher now than any year since 2014; job growth in the past three months is the lowest since 2010; and spending on services has declined for three straight months for the first time since 2008. How are companies, individuals, and the government supposed to deal with an economy slipping toward recession if we’re smashing the tools we need to know how fast we’re falling? In a tempest, it’s unwise to ransack the navigation system.
The greater threat here is not just economic in nature. Choose-your-own-reality governance is a threat to the most basic principles of liberal democracy. If economic statistics can be distorted, and climate data can be canceled, and vaccine analysis can be politicized, where exactly is the line? Transparency, trust, and public truths are essential to the functioning of liberal democracy. We’re all learning in real time just how vulnerable those values really are.
One of the most concerning aspects of this issue is that it only takes one instance of political meddling in what is supposed to be independent data collection/reporting to permanently damage trust in government-provided data. You touched on this early on, but when I was in grad school a couple of years ago doing a master’s in applied economics, government data was among the most trustworthy sources available. It wasn’t always the easiest to use, depending on things like the level of aggregation or frequency of collection, but there were never any doubts about the accuracy or integrity of the data. In my experience, BLS data, in particular, has been among the highest quality government data available.
Now, say Trump appoints someone new to lead BLS data collection and reporting, and that person says, “The previously reported numbers were incorrect, these are the actual numbers,” providing new figures that differ from the old ones and happen to be more favorable to Trump’s policies. How is anyone supposed to trust that those numbers are more accurate, especially when no justification is given for why the previous data is suddenly unreliable, other than that it’s politically inconvenient?
Fast forward four years: Democrats win the election and appoint their own person to oversee data collection and reporting. The numbers change again. Even if they revert to the original methodology, they’ve still interfered with what is supposed to be an independent, nonpartisan process. At that point, critics could make the same argument we’re now making about Trump: “How can we trust the data when your party’s political appointee is the one producing it?” I’m not saying the two scenarios are morally equivalent, but they both risk leading to a situation where Democrats calculate and report data one way, and Republicans calculate and report it another. That’s a dangerous precedent.
Finally, from a practical standpoint, changes to how data is collected, calculated, or reported can seriously undermine its usability. If unemployment statistics, for example, are reported differently one year to the next, you lose the ability to make meaningful comparisons over time. Even if both data points technically measure unemployment, they are no longer measuring it in the same way, making direct year-over-year comparisons invalid. Ultimately, I believe this kind of interference poses a serious threat to both the integrity and practical utility of government data, and I’m deeply concerned about what other doors it could open.
I don't see how any serious person would invest in this country right now. I manage a small business and we are hemorrhaging clients due to developers pushing off new projects. Projects that were pushed off for interest rates, but committed to moving forward in Q1 are all back on the shelf until next year. Watching an empire commit suicide for the ego of one man is beyond surreal.