Solve for 'X': Trump's war on facts extends to undermining key federal statistics

I run a mile in three minutes flat. So long as I provide the stopwatch.

I tip the scales at the perfect weight for my height. So long as I supply the scale.

I boast the highest IQ in history. So long as I score my own test.

How tempting to gauge reality by self-fashioned yardsticks. Economists rightly worry that the Republican-led Congress and the Trump administration will do just that.

For years, Congress has been slashing budgets for gathering economic statistics — blithely acting as if calculating mass layoffs, worker pay and benefits, exports and imports, or income disparity between regions is a boondoggle.

A new president averse to facts he doesn't like could further vandalize honest portraits of economic performance.

"What are the nation's leading economists freaking out about these days?" a Washington Post reporter wrote after a January meeting of the American Economic Association (AEA), composed of the nation's leading economic scholars.

"Not so much plunging into recession (due to a possible trade war) or, alternatively, an overheated economy (due to a possibly ill-timed fiscal stimulus)," she wrote. "Instead, they're worried that we won't actually know whether either scenario materializes — because some of our best economic measurement tools may soon be compromised."

The consequences could be a federal government that ignores warnings of economic distress and makes misguided policy choices that leave millions of Americas the poorer for it. Calculated chaos — or, rather, chaos born of miscalculation.

Just this month, the Trump administration has embarked on distorting economic reality.

The White House privately has pondered changing the way trade balances are measured — to artificially balloon the size of U.S. trade deficits, the Wall Street Journal reported. Like magic, a $63.1 billion trade deficit with Mexico last year would become a $115.4 billion deficit.

Fabricated fears would be a call to arms for extreme policies on trade favored by the White House.

Want to push $6 trillion in tax cuts, mostly for the rich? Don't fret about soaring federal deficits. Just demand, as Trump has, that budget writers assume U.S. economic growth rates double in the next several years. Presto chango! Expected tax revenue fill the yawning gap.

Until they don't.

Already, some economic statistics are on the way to becoming a hall of mirrors, bending truth.

Budget cuts already have forced some federal agencies to pare back the collection of economic statistics that measure shifts in population, incomes, demographics and other factors that drive change.

In the first week after Inauguration Day, gag orders limiting public disclosures were imposed on the U.S. Department of Agriculture, the Environmental Protection Agency, the Department of Health and Human Services, and even the National Park Service.

Can collectors and interpreters of economic statistics be far behind? A war on facts could lead to serious casualties, especially if economic statistics, created by nonpartisan federal agencies, end up being molded by political agendas.

Federal economic data guide the disbursal of hundreds of billions of dollars in annual federal aid to states and localities. They inform choices on taxes, as well as spending on unemployment insurance, food stamps, and welfare. They monitor hiring and firing, worker compensation, and hours worked, not to mention international trade and immigration.

Fixing problems requires first knowing that they exist. Governments that shade facts to their own ends can wind up confusing themselves, as well as everyone else.

In the mid-1990s, I sat in on a private Tokyo meeting of economists and securities analysts discussing a Japanese economy that in 1989 moved from fast-growing to lethargic. The slowdown lingered for years.

The question at hand: To what degree did a change in the export of Japanese-made cars contribute to economic ills?

The experts agreed on an important point: No one knew.

The reason was sobering. The Japanese government was notorious for "adjusting" export figures to calm anxieties among trading partners. So not even top Japanese officials had reliable numbers on the performance of a key industry.

Perhaps not coincidentally, Japan failed to adopt policies to counter its often-neglected economic woes.

Problems of the present and past could be "defined away" with altered U.S. statistics. But cooking the books to make decisions about the future is particularly perilous. In an $18 trillion economy, the job already is hard enough.

The Bureau of Labor Statistics (BLS), the Bureau of Economics Analysis (BEA), the Census Bureau, the Congressional Budget Office (CBO) and a host of other agencies provide crucial guidance for keeping the economy on course.

The Washington statistics mills are the equivalent of aircraft instruments to pilots. Without knowing the position, direction and altitude, an economy — like a plane — quickly can face self-inflicted hazards.

Recent evidence suggests that some of the people now in charge fly by the seats of their pants. Congressional budget-cutters and the new president seem eager to undermine findings that they don't want to hear.

President Trump wouldn't admit that the U.S. jobless rate fell to 4.7 percent at the end of the Obama years. Solution: Declare that the "real" unemployment rate stands at 42 percent.

Mexicans are flooding across the border to steal American jobs? Ignore the government-certified fact that in recent years more people have migrated south across the Rio Grande than north.

Republicans eagerly promote a $6 trillion tax cut for the next decade. How inconvenient that the CBO projects a rise of $10 trillion in the federal budget deficit over the same period — before counting the lost revenue of tax cuts.

Someone should have a word with the gnomes at the CBO for their impertinence. And someone probably will.

A federal budget freeze, begun in 2013, forced the BEA to eliminate collection of county-by-county statistics on unemployment benefits, Social Security payments, farm income and expenses, the number of people employed in other industries, and their wages.

Try to cope with local economic problems without knowing what they are.

Budget cuts at the BLS pared $154 million from White House requests from 2011 through 2015. The agency now faces a Trump-imposed hiring freeze and the prospect of more budget cuts from a Republican-led Congress.

So what? The BLS wants to learn more about the pay and hours of "contract workers," those who work without benefits or long-term contracts — a growing segment of the economy. How can laws and rules respond to change when no one knows exactly how the labor force is changing?

The agency also wants to gather more detail on job openings and turnover, "allowing policymakers at the state and federal levels to see the sectors in which demand is growing or labor needs are not being met. It might even be able to predict potential market downturns," according to the Center for American Progress, a liberal think tank in Washington, D.C.

Congress has been chopping away at the Census Bureau budgets for years. The casualties include experiments in online census taking and streamlining data analysis that could save billions in the 2020 population count.

Census numbers not only provide the basis for congressional redistricting but for mapping economic disparity from region to region and locality to locality.

One way to tame numbers is to collect fewer of them or ensure that they add up to a welcome story.

Have doubts that nonpartisan civil service employees at Census, CBO, BLS and other federal agencies soon will be under threat? They already are.

No sooner had the new Congress convened than House Republicans revived a long-abandoned rule that allows reducing the pay of select government employees to $1.

First adopted in 1876 — the year of Custer's Last Stand — the directive effectively confers the power to fire workers who for generations have been protected from political pressures by the civil service system.

Don't be surprised if arrows start flying at the keepers of numbers who displease Congress or the Trump administration.

The party in power has inherited the strongest economy in decades. The job market is at, or near, full employment. The rise in consumer prices has been near nil. Federal deficits have been falling.

Therein lies a problem. The odds are low that these economic touchstones will get better in the next few years. Indeed, much of the risk is that they'll get worse.

Unless.

What if leaders of the majority political party had the means to describe the economy on their own terms, using made-to-order numbers?

That's now possible with one party rule. Many economists are rightfully worried.

"Consider, for example, the besieged American Community Survey, which has been around in some form since 1850," a Washington Post reporter wrote after the annual AEA conference.

"Over the past several years, congressional Republicans have repeatedly attacked this critical survey as unnecessary and intrusive. In 2012, they voted overwhelmingly to eliminate its funding entirely." Democrats found a way to block that effort.

The survey guides allocation of more than $400 billion in federal aid to states and localities. It shapes distribution of money for schools, health care, roads, housing. It also helps "to fight crime including mapping the likely locations of meth labs and to inform business decisions made by home builders, retailers and entrepreneurs, among others."

To many Republicans, the American Community Survey is an example of meddling by the federal government.

A failed GOP repeal of all funding for the survey won the support of Rep. Mick Mulvaney. Recognize the name?

Trump chose the South Carolina Republican to run the U.S. Office of Management and Budget. He may kill the American Community Survey yet.

The better way to allocated federal money? By political lobbying, apparently.

In that event, I'd like to make my case personally to receive federal grants that will yield huge economic returns close to home. Very close to home.

After all, I merit the investment. I'm the fastest, fittest, smartest person in America. Evidence available upon request. Even now, I'm working on the numbers to make the numbers work for me.

Mike Meyers, a former Star Tribune business reporter, is a writer in Minneapolis.