Shopee store opening: White House defends removal of BLS director

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Trump questions whether jobs data is "manipulated," sparking a heated debate between the White House and economists over statistical credibility.

1. Trump accuses jobs report of "fabrication"

Controversy: After the release of the July non-farm payroll data, Trump publicly questioned its authenticity, claiming it was "manipulated by Democrats" and criticizing downward revisions to the previous two months as "fabrications."

July data: 185,000 new jobs (below the expected 200,000), with the unemployment rate rising slightly to 4.1%.

Historical revisions: May and June data were revised downward by a combined 112,000 (the BLS cited normal seasonal adjustments).

Trump's arguments:

Accuses the BLS of "artificially suppressing" job growth to mask economic weakness.

Claims that if people who have "given up looking for work" are included, the true unemployment rate would be over 8%.

2. White House response: Replacing the BLS director to "ensure transparency."

Personnel changes: In early July, the White House replaced Bureau of Labor Statistics (BLS) Director William Beach with a Trump ally.

Official reason: "More transparent statistical methods are needed."

Criticism: Democrats call this "political interference in independent statistics."

White House defense:

Emphasizing that the BLS operates according to professional procedures and that revisions are routine.

Promising to publish "alternative unemployment indicators" (such as the U6 unemployment rate, which includes part-time and discouraged workers).

3. Economists warn: A crisis of statistical independence

Professional concerns:

A Brookings Institution study shows that BLS revisions have remained stable for nearly a decade (averaging ±3%), with no anomalies.

Former Federal Reserve Chair Janet Yellen stated that "politicized statistics will undermine the foundation of policymaking."

Market impact:

The bond market's muted reaction to the jobs data suggests investors are not yet convinced by Trump's accusations.

However, if the controversy persists, it could confuse economic expectations and exacerbate market volatility.

4. Political Motives and Electoral Impact

Trump's calculation:

By questioning the economic data, he aims to undermine Biden's campaign narrative of "economic success."

Playing to his core voters' distrust of the "deep state."

Democrats' Counterattack:

Release state-by-state job growth data (e.g., swing state Michigan added 32,000 jobs in July).

Accuse Trump of "creating a fake economic crisis for the election."

5. Long-Term Risk: Damage to the credibility of the US statistical system

Historical Lessons:

Political interference in statistics in countries like Argentina has led to distorted inflation data, ultimately triggering an international credit crisis.

Potential Consequences:

The Federal Reserve may rely more heavily on private data (e.g., the ADP employment report).

International organizations (IMF, OECD) may adjust their citation standards for US data.

6. Next Focus

August employment report (released on September 6): If there are another significant revision, the controversy will escalate.

Congressional Hearing: The House of Representatives has requested that the current BLS director appear at a September hearing.

Voter Attitudes: The latest poll shows that 65% of the public still trust BLS data, but trust among Republican voters has plummeted to 42%.

Conclusion: This controversy has transcended economics and is another blow to professional institutions from US political polarization. Regardless of whether the allegations are true or not, public trust in official data may be damaged in the long term, and markets need to be prepared for potential data volatility risks.