Let’s just say that governments are not above such statistical racketeering. You have surely noticed how much of life in the United States today under the Biden administration shares in common with certain features with the old Soviet system. Sure, it is nice and has a more persuasive veneer of democracy but what’s called lawfare is increasingly deployed to purge official ranks and large corporations are ever more playing footsie with the leviathan state.
Perhaps it is time to ask some fundamental questions about the economic data we are being given. A spectacular column in the Wall Street Journal by Josh Zumbrun has done this. He nowhere speculates about possible lying but he does raise some profound questions about whether and to what extent we can even count on the accuracy of the data anymore.
The problem traces to the chaos of lockdowns and the loss of trust of so many businesspeople even to talk to agencies or report numbers to them. Essentially, we are seeing ever lower levels of participation in the kind of polling once considered a normal part of civic life. Many people just don’t want to play the game anymore and have simply stopped answering.
Zumbrun reveals shocking changes in participation in all mainstream economic surveys.
Current population survey participation in 2014: 90 percent. Today: 70 percent.
Consumer Price Index for housing participation in 2014: 71 percent. Today: 58 percent.
Consumer Price Index for commodities and services participation in 2014: 67 percent. Today: 54 percent.
Employment Cost Index participation in 2013: 73 percent. Today: 47 percent.
Current Expenditures interview participation in 2014: 67 percent. Today: 42 percent.
Current employment statistics participation in 2014: 63 percent. Today: 42 percent.
Job openings and labor turnover participation in 2014: 65 percent. Today: 32 percent.
“Other types of error are potentially much bigger,” he writes. “What if the people who don’t respond to surveys are much different than those who do? What we end up with is data that’s just fuzzier than it used to be.”
One does wonder. Zumbrun ominously observes: “This has created an environment in which it’s easy to cherry pick a starting point for data comparisons and come up with nearly any result you would like .... It’s no surprise that many people don’t totally know what to make of it all.”
Any result? Yes. And that’s the problem. If all of this is correct, we don’t really know the inflation rate. We don’t know the GDP. We don’t know the jobs situation. We don’t know expenditures. We don’t know much of anything we cite as a signal of economic health.
A lot of this problem traces to the incredible chaos that began in 2020. It prompted our journalist friend to offer his “fairly severe” critique on the problems with data.
Even though the article is understated, we have to consider what it means. We might not really understand much at all about the “national mood,” about which candidates are up or down, about whether inflation is really going away, or anything much else at all.
Think of how much we rely on the authority of data. Much of what we think we know comes from it and its accuracy is wholly dependent on the methods used to collect it and the veracity of the responses. If ever fewer people are participating at all, what good is it really? Can you really extrapolate from a small and shrinking sample to the whole population using statistical techniques?
For some time now, I’ve speculated that perhaps we never left the 2020 recession, that the job numbers are a load of bunk, that the nation is far angrier than we know, that government and all official institutions are less trusted and less popular than we think.
It turns out that our worst fears might indeed be true. We just aren’t being told and for two reasons: we have no way really to measure this and the people pretending to do the measuring have every incentive to lie about it.
Maybe this realization can give you comfort in the new year. It certainly does me, because it makes me realize that my intuitions are not crazy. They might be more accurate than any of the data reported by the mainstream press.