WASHINGTON – A relatively small number of conspiracy theorists claiming the Obama administration somehow cooked the books on jobs data were getting a fair amount of attention Friday, but the fact that people indulge some loopy notions at the height of campaign season isnt a big deal.
The real story about the Bureau of Labor Statistics data is how enormously credible it is.
Financial markets, the media, opposition politicians and everyone else almost uniformly takes it seriously.
If anything, the national pathology is taking the month-by-month errors a little too seriously and not wrestling with sample error, modeling error and the relatively large scale of revisions.
Conspiracy theorists are rare enough to be newsworthy, and widely dismissed as conspiracy theorists.
But note that it doesnt have to be this way.
Nobody takes Chinese government economic data seriously. If someone told you that Vladimir Putin was juicing jobs data ahead of a campaign, you wouldnt dismiss him.
And in any kind of transitional democracy situation – think Mexico or Colombia or Poland in 1995 – putting your thumb on the scale of economic information is one of the most obvious uses of incumbent power you can imagine.
And Richard Nixon seems to have seriously considered doing this with the BLS.
But while American presidents certainly do deploy the powers of incumbency, they dont do it in this abusive way, and the vast majority of people dont believe they do it in that abusive way.
This is a remarkable fact and its a big part of what makes America great.
Trustworthy economic data is a very valuable public good that serves as a useful production input for tons of private businesses.
It also helps smaller-scale government agencies and nonprofits make smarter decisions.
And last but by no means least, precisely because the BLS is credible, presidents know that theyd take an enormous political hit if they were seen as manipulating it.
The result is a stable equilibrium thats friendly to democracy and capitalist prosperity alike.
Its not easy to achieve, but its important to achieve and its something we should celebrate about America. Politicians regularly engage in rhetoric that suggests they believe public agencies will perform poorly.
But its not true and the fact that we have lots of great government agencies – the ones producing our federal statistical information not least among them – is part of the strength of America. Long story short, if your business relies on accurate credible statistical information in its planning, you didnt build that.