Caracas on the Potomac

Goodbye, reliable economic data

Paul Krugman
Aug 01, 2025

What I wrote just before Trump took office

If stagflation breaks out under an authoritarian regime, but officials aren’t allowed to report the numbers, did it make a sound?

Over the past six months we’ve watched institution after institution corrupted by the Trump administration. Institutions that might produce inconvenient information, from those tracking climate change to those tracking infectious disease, have been special targets.

And now they’ve come for the economic data.

As many others and I have pointed out, this morning's jobs report was very bad:

The Meaning of a Weak Jobs Report

Paul Krugman

Aug 1

I’m working on a full-length primer on tariffs for Sunday, but this morning’s jobs report shocker needs a comment.

It didn’t signal a recession — not yet—but it showed a rapidly slowing economy. And it was presumably especially disturbing for Trump and those around him, who have been boasting about how hot the economy is and sneering at critics pointing to the harm being done by chaotic policy. For this report seems to validate the critics.

So there was only one thing to do: Trump summarily fired the commissioner of the Bureau of Labor Statistics, accusing her without evidence of manipulating the numbers for political purposes.

Who could have seen this coming? Anyone paying attention. The picture at the top is a screenshot from a post I put up just before Trump took office. I was mainly focused on politicization and corruption of inflation data, but it’s the same principle — and would involve the same organization.

People who don’t follow these things closely may not realize how important the Bureau of Labor Statistics is. But it’s our prime source of short-term information about economic developments. The BLS conducts a monthly survey of households that is, among other things, how we estimate unemployment. It conducts another survey, of employers, which is where we get estimates of payroll growth like the one above. A third survey, of prices, is the basis for the Consumer Price Index, and supplies the basic data for other inflation measures too.

The BLS isn’t always right, nor should you expect it to be. It’s trying to track a complex economy, and sometimes it revises its past estimates — as it did this morning. But it is extremely professional, rigorously nonpartisan, and everyone in the business considers it the gold standard for economic data.

Or maybe I should say “it was” rather than “it is”. I have to admit that I expected Trump’s corruption of economic data to be insidious and take place gradually. Instead he just fired the head of the BLS because he didn’t like the numbers it reported — a clear signal to the remaining staff not to report bad news.

And just like that, we can no longer treat BLS data as the gold standard. (Maybe Trump will use the gold on the walls of his new ballroom.) Maybe, just maybe, the staff at the BLS will hold to their principles and continue to report honestly. But how can we trust what they report — especially if Trump flunkies are put in charge, filtering what gets released?

From here on, I’m going to be paying a lot more attention to private surveys. And when they tell a different story from the official numbers, there will no longer be a reason to take the official data more seriously.

It’s one more step on our rapid descent into banana republic status.