Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: Some of the presidents Alex advisors have suggested that you
Speaker 2: should resign.
Speaker 1: If he asked you to leave, would you go? No?
Speaker 3: Can you follow up on it?
Speaker 1: Do you think that legally you're not required to leave?
Speaker 2: No.
Speaker 3: I'm Stephanie Flanders, head of Government and Economics at Bloomberg.
Speaker 3: Welcome to Trumpanomics, the podcast that looks at the economic
Speaker 3: world of Donald Trump, how he's already shaped the global
Speaker 3: economy and what on earth is going to happen next?
Speaker 3: And it's that what's going to happen next part that
Speaker 3: we're focusing on this week. There's so many presidents being
Speaker 3: broken in Washington these days, it's easy to miss a few.
Speaker 3: Last week, well, most were focused on deportation, court orders,
Speaker 3: flights to El Salvador. Something happened that we at Trumpanomics
Speaker 3: think should have got more attention. Two commissioners on the
Speaker 3: Federal Trade Commission got fired for being Democrats. Now you
Speaker 3: might say, so, what, who isn't being fired in the
Speaker 3: nation's capital these days? Except it's not really supposed to
Speaker 3: happen at an independent agency like the FTC. And if
Speaker 3: it can happen to officials there. It raises questions about
Speaker 3: whether folks at other independent agencies, even senior ones, could
Speaker 3: be fired too. Fed share J Powell, for example, who
Speaker 3: you heard voicing a rather different opinion at the start
Speaker 3: of the show. It also made us think about some
Speaker 3: other seemingly minor developments in other corners of DC that
Speaker 3: could raise red flags about the independence and oversight of
Speaker 3: not only the agencies that implement America's economic and regulatory policies,
Speaker 3: but even potentially the economic data on which every judgment
Speaker 3: about the US economy is based. Now, of course we
Speaker 3: might be overdoing it. I hope we're overdoing it. Some
Speaker 3: of these risks may well not materialize, but when it
Speaker 3: comes to the independence of monetary policy and economic statistics, well,
Speaker 3: we at Bloomberg get nervous fairly easily. David Wilcox has
Speaker 3: spent his entire career overseeing and analyzing US economic data
Speaker 3: and policy, first as Assistant Secretary for Economic Policy at
Speaker 3: the US Treasury under President Clinton. He was then many
Speaker 3: years until twenty eighteen, leading the Research and Statistics Division
Speaker 3: for the US Federal Reserve. Acted as a senior advisor
Speaker 3: to three Federal Reserve chairs, including Jay Powell happily for us,
Speaker 3: he's now reached the pinnacle of his career as the
Speaker 3: director of US economic research for Bloomberg Economics. David, thank
Speaker 3: you very much for joining us and for being the
Speaker 3: one really to sound the alarm about a lot of
Speaker 3: these things.
Speaker 1: It's good to be here.
Speaker 3: Well, I know you do have a lot of thoughts
Speaker 3: and concerns about this, based on your experience on the
Speaker 3: inside of these agencies and decisions. But I also wanted
Speaker 3: to get a bit of the reporter perspective from Molly Smith,
Speaker 3: who's a US economics editor for Bloomberg in New York
Speaker 3: and has been writing up quite a lot of what's
Speaker 3: been happening at the statistical agencies and other parts of
Speaker 3: DC that collate US economic data in recent months. Molly,
Speaker 3: welcome to Trumponomics.
Speaker 2: Thanks for having me.
Speaker 3: So, David, let's start with that first thing. I mentioned,
Speaker 3: the firing of two commissioners, which definitely did get a
Speaker 3: little bit lost in the enormous amount of other news
Speaker 3: that's happening on a daily basis in Washington. Why did
Speaker 3: you immediately pick up the phone to tell us this
Speaker 3: was something to worry about.
Speaker 1: Well, the historical parallel is just echoes very loudly. Nearly
Speaker 1: one hundred years ago, President Franklin Dello and Or Roosevelt
Speaker 1: also tried to fire an FTC commissioner named William Humphrey.
Speaker 1: Humphrey initially had been appointed to the FTC by President
Speaker 1: Calvin Coolidge in nineteen twenty five, and was reappointed to
Speaker 1: a second term by President Herbert Hoover. When FDR came
Speaker 1: into office, he correctly identified Humphrey as somebody who held
Speaker 1: different policy views than FDR did, and so he asked
Speaker 1: Humphrey twice in letters to resign, but Humphrey refused, so
Speaker 1: FDR fired him. And that came despite the fact that
Speaker 1: there was language in the FTC Act saying that the
Speaker 1: President could fire members of the Commission only for inefficiency,
Speaker 1: neglected duty, or malfeasance in office, and Roosevelt didn't allege
Speaker 1: that any of those applied in the case of William Humphrey.
Speaker 1: Humphrey refused to go. He sued for back wages, the
Speaker 1: wages that he hadn't been paid after he'd been terminated.
Speaker 1: Then he suffered the misfortune of before the case found
Speaker 1: completion through the court system, which then as now the
Speaker 1: wheels of justice turned rather slowly, but Humphrey's executor, the
Speaker 1: executor of his estate, took up the legal cause and
Speaker 1: maintained the lawsuit, and ultimately, in nineteen thirty five, the
Speaker 1: Supreme Court ruled in Humphrey's favor and awarded those back
Speaker 1: wages to his estate. That the case is incredibly important
Speaker 1: today because it's that legal foundation, that nineteen thirty five
Speaker 1: Supreme Court decision on which rests the employment security such
Speaker 1: as it is that Federal Reserve governors also enjoy. The
Speaker 1: language in the Federal Reserve Act is a little different,
Speaker 1: but the legal principle is exactly the same.
Speaker 3: And to be clear, the firings in this case were
Speaker 3: in a sense similar to the FDR ones because it
Speaker 3: was not based on bad behavior, and there was no
Speaker 3: claim it was based on bad behavior. It is the
Speaker 3: fact that they potentially disagreed with the administration the continued
Speaker 3: service on the FTC. The statement said, the explanation from
Speaker 3: the White House was is inconsistent with my administration's.
Speaker 1: Priorities, exactly right. And I think what we're likely to
Speaker 1: see here can't say with certainty, but likely, I think
Speaker 1: is that this case involving the two FTC commissioners will
Speaker 1: work reasonably rapidly through the court system and will get
Speaker 1: a decision ultimately, probably from the Supreme Court. An extra
Speaker 1: reason for concern is that the Supreme Court has been
Speaker 1: chipping away at that nineteen thirty five decision Humphrey's Executor
Speaker 1: versus the United States. Twenty twenty, for example, they limited
Speaker 1: the reach of Humphrey's Executor so that it no longer
Speaker 1: applies to single headed agencies like the Consumer Financial Protection Bureau.
Speaker 1: They said it did still apply as of twenty twenty
Speaker 1: to multi head agencies like the Federal Reserve Board. But
Speaker 1: I think there's a lot of opinion in legal community
Speaker 1: among legal scholars that Humphrey's Executor hangs by a thread,
Speaker 1: and with it the independence of the Federal Reserve, its
Speaker 1: ability to set monetary policy without fear of being second
Speaker 1: guest by political authorities.
Speaker 3: And it should be said it would put the administration
Speaker 3: in direct opposition to the way that j. Powell himself
Speaker 3: said he saw the situation. In the first press conference
Speaker 3: after the election, he was asked, can you be fired?
Speaker 3: Are you worried about being fired by the president, and
Speaker 3: said no, in a very kind of this is not
Speaker 3: a questioned way. Was that your understanding, David, when you
Speaker 3: were inside the FED that it was just there was
Speaker 3: just not an issue about whether or not the President
Speaker 3: could fire at FED chair.
Speaker 1: Well, as in many things in the legal world, it's
Speaker 1: a little complicated. There are two positions that Jay Powell holds.
Speaker 1: One is that he's a member of the Board of
Speaker 1: Governors and they're The Federal Reserve Act language is quite
Speaker 1: clear the President may terminate members of the Federal Reserve
Speaker 1: Board for cause. The other position to which he also
Speaker 1: needs to be confirmed, is as Chair of the Federal
Speaker 1: Reserve Board, and there the drafting of the language, unfortunately
Speaker 1: was rather awkward and leaves ambiguous the question about whether
Speaker 1: the President can demote the chair from his elevated status
Speaker 1: to that of a mere member of the Board of Governors.
Speaker 1: That question has never been litigated. No president has ever
Speaker 1: tried to demote a Federal Reserve chair before. I think
Speaker 1: it's possible that we may see that question resolved here
Speaker 1: in the future.
Speaker 3: But the broader concern which I mentioned at the start,
Speaker 3: was around something which one thinks of as even more
Speaker 3: of a kind of bedrock for US economic policy, and
Speaker 3: that's just economic data, Molly, what's happened in the last
Speaker 3: few weeks, as Doge and other parts of the administration
Speaker 3: have been sort of cutting a sway through Washington, what's
Speaker 3: happened that has raised concerns around statistics.
Speaker 2: So the biggest thing that I could point to so
Speaker 2: far has been the administration terminating these statistical advisory committees.
Speaker 2: And this was part of a broader executive order aimed
Speaker 2: at reducing the scope of the federal government and eliminating
Speaker 2: these committees wherever they were deemed unnecessary. And the thing
Speaker 2: is about these committees, though at least for the statistical agencies,
Speaker 2: is that they're made up of all volunteers. David can
Speaker 2: speak to this also, he is chair of one of
Speaker 2: these committees, so he knows this all too well. They're
Speaker 2: all on a volunteer basis. They are not paid, they
Speaker 2: are not employees of the federal government. And they generally
Speaker 2: a lot of these committees met maybe two to four
Speaker 2: times a year. And since COVID, it's all been virtual
Speaker 2: for the most part, so they really had just about
Speaker 2: zero cost to the government. I think the biggest budget
Speaker 2: of any of them was maybe one hundred thousand dollars,
Speaker 2: so this is certainly not or does is going to
Speaker 2: be zeroing in on for the big for the big
Speaker 2: bucks in terms of savings here. And it's really, if anything,
Speaker 2: you know, these committees were there to advise the statistical
Speaker 2: agencies about a whole range of things, whether it was
Speaker 2: really how to keep up to date with our economy
Speaker 2: which is ever evolving, and to make sure that the
Speaker 2: data was commensurate with that and reflecting these new trends.
Speaker 2: And it was really just a huge benefit to them
Speaker 2: to have people on these committees that maybe were formerly
Speaker 2: on these agencies themselves that maybe now work in academia
Speaker 2: or our business economists work on Wall Street, in all
Speaker 2: different real corners of economics and providing this free advice.
Speaker 2: So if anything, now maybe you'd think, oh, well, not
Speaker 2: that the government is going to be spending money on this,
Speaker 2: but if they were to want a value of that back,
Speaker 2: it would be through hiring consultants. But these people did
Speaker 2: it for free. So committees. The committees that were terminated
Speaker 2: include one to the Bureau of Economic Analysis, that's the
Speaker 2: agency that pulls together the GDP report as well as
Speaker 2: the Fed's preferred inflation gauge, the personal consumptions expenditures price index.
Speaker 2: So the BA advisory committee was one. Another was the
Speaker 2: one that David shared, which advised across the BA as
Speaker 2: well as Bureau of Labor Statistics and Census. And I
Speaker 2: also just learned that in the past week two of
Speaker 2: the advisory committees to the BLS were also terminated, effective
Speaker 2: actually a month ago, but those people only just found
Speaker 2: out last week.
Speaker 3: So just to tease this out, and it's just to
Speaker 3: demonstrate how all over this story, David Wilcox is you
Speaker 3: were personally, as Molly mentioned, you were personally running one
Speaker 3: of these committees. Briefly, in terms of the value of
Speaker 3: these organizations. I mean, it sounds like you were giving
Speaker 3: them advice on improvements in the data, but I guess
Speaker 3: there was also a little bit of an informal oversight
Speaker 3: by the academic and sort of stakeholder community of changes
Speaker 3: that were being considered by these bureaus.
Speaker 1: Is that right, Yeah, that's right. It's important to note
Speaker 1: that for all of these committees, the word advisory was
Speaker 1: right in their title. We had no decision making power,
Speaker 1: but we were populated by people who were at the
Speaker 1: top of their fields with incredible expertise on the committee
Speaker 1: that I was privileged to serve as chair for. One
Speaker 1: of our members was Droona Jimoglu. You may have heard
Speaker 1: his name because he's a recent recipient of the Nobel
Speaker 1: Prize in economics. He was the only Nobel Prize winner.
Speaker 1: But the committee was chock full of members.
Speaker 3: Who were free. As Molly has underlie, they were getting
Speaker 3: a value for money.
Speaker 1: They were getting nothing in the way of an honorarium.
Speaker 1: They were serving for the purpose of advancing the public good.
Speaker 1: They came from a range of different areas of subspecialty.
Speaker 1: What they had in common were two things. One was
Speaker 1: a conviction that economic measurement is difficult, ever changing, and
Speaker 1: super important for decision makers across society. And secondly, they
Speaker 1: had the conviction that what they were doing had a
Speaker 1: risk of making a difference if they said something smart.
Speaker 1: The agency heads were in the room, the subject area
Speaker 1: experts were in the room, and there was a risk,
Speaker 1: just a risk, that the agency might change direction as
Speaker 1: a result of their advice.
Speaker 3: So I guess you have to wonder a little bit
Speaker 3: why you wouldn't want a free and very well founded,
Speaker 3: deeply researched views by members of that broader community that
Speaker 3: uses economic statistics. But if you were making a change,
Speaker 3: for example, I don't know. We've heard the COMMA Secretary
Speaker 3: Howard Lutnik suggest take the government's share of the economy
Speaker 3: out of GDP. Would that be something that the Advisory
Speaker 3: Committee would have had views on?
Speaker 1: Do you think, David, absolutely, we would have had views.
Speaker 1: Whether they would have come and asked us, I think
Speaker 1: that's open to question. It's such a basic question. It's
Speaker 1: been long settled. It was debated fifty sixty years ago
Speaker 1: when the whole concept of national income and product accounts
Speaker 1: was being invented. But that's been resolved literally for decades.
Speaker 1: It is now a matter of both national norms and
Speaker 1: international standards that government demand is included in the field
Speaker 1: of activity that's taken into account for purposes of tallying
Speaker 1: gross domestic product or what we all know as GDP.
Speaker 3: And of course it's true. It makes reporters immediately think,
Speaker 3: oh my god, and economists think, how could you possibly
Speaker 3: start comparing countries if you suddenly had a totally new series.
Speaker 2: You know, David and I have spoken about this extensively
Speaker 2: as well, and something that when I about this a
Speaker 2: couple of weeks ago, that really stood out to me
Speaker 2: that he said was there's this one idea of like
Speaker 2: maybe Lutnik was just floating the idea of how the
Speaker 2: data is presented, as in, maybe the government spending figure
Speaker 2: is still there in the GDP report, but they publish
Speaker 2: let's call it, like a maybe so called core GDP
Speaker 2: that excludes it, so that you can still see it.
Speaker 2: You can add it back in if that's how you
Speaker 2: choose to calculate it, which is the still standard way.
Speaker 2: That's one thing, not great, but you would still have
Speaker 2: the data there. It's not like it's been eliminated that
Speaker 2: you could calculate it yourself. The real concern, which I
Speaker 2: don't know that this is what Lutnik was implying, but
Speaker 2: certainly you could make this inference, was that what if
Speaker 2: the GDP report just did not publish government spending it
Speaker 2: all anymore? What if that data just simply was not
Speaker 2: collected anymore, and that calculation then could not be made
Speaker 2: the same way. That's more the concern when I talk
Speaker 2: to people who are at the statistical agencies in the
Speaker 2: let's call it the alumni community of the agencies, that
Speaker 2: they're really worried looking from the outside in and I know.
Speaker 3: For various reasons, Molly, You've been sort of calling around,
Speaker 3: particularly in the last few weeks, people who work at
Speaker 3: these agencies insofar as you know them, and also people
Speaker 3: who've formerly worked there. I mean, how nervous are they
Speaker 3: specifically around this question of the statistical agencies? What are
Speaker 3: you picking up.
Speaker 2: The thing that the biggest thing is to what extent
Speaker 2: can the government interfere with statistics? And I don't want
Speaker 2: to be here fear mongering, because I think that's you know,
Speaker 2: a lot of what has happened in the last two
Speaker 2: months is really, of course, as Trump is really pushing
Speaker 2: the boundaries of what the executive branch can do, and
Speaker 2: it's created a lot of questions of, oh, if he
Speaker 2: did X, can he do why? Or does X then
Speaker 2: apply to something else? And I certainly don't want to
Speaker 2: be out here raising concerns that are unfounded. But these
Speaker 2: are just questions that people have and are very much
Speaker 2: spoken about in this community of people who I talk to.
Speaker 2: So one of them is definitely seeing political interference in
Speaker 2: the numbers. And one of the reasons why US economic
Speaker 2: data is considered among the gold standard for the rest
Speaker 2: of the world is because it's largely impartial that the
Speaker 2: people who produce these numbers are mostly civil servants. They
Speaker 2: are not political appointees. Certainly the heads of the agencies are,
Speaker 2: but everyone is there with just a real commitment to
Speaker 2: producing a public good. And as David was saying, you
Speaker 2: know that the value of these numbers for making decisions
Speaker 2: across all levels of decision making and policy making, that's
Speaker 2: really what the core of the mission is all about.
Speaker 2: And you know, people have raised ideas of seeing how
Speaker 2: in other countries that have more authoritarian regimes, where the
Speaker 2: numbers can be politically influenced, like in Russia, like Argentina
Speaker 2: has had a past with this during the Greek debt crisis.
Speaker 2: There have been other examples where politicians have found the
Speaker 2: way to somehow insert themselves in the data to varying extents,
Speaker 2: and that seems to be the real concern here or
Speaker 2: something else that people raise too is especially now as
Speaker 2: we're starting to get a better idea of how tariffs
Speaker 2: would impact the economy, namely through slower growth and faster
Speaker 2: or at least more elevated inflation. The idea of what
Speaker 2: if Trump's he's a report that he doesn't like and
Speaker 2: could would the agencies just simply not report it that one.
Speaker 2: I don't know if that really has a material risk
Speaker 2: of happening.
Speaker 3: Probably more than most places. We're very sort of hardwired
Speaker 3: for the time and date of the release of these
Speaker 3: numbers exactly all hell would break. Well, well, maybe we'll
Speaker 3: find out, but I mean we should say none of
Speaker 3: these things have happened yet. And I guess you know,
Speaker 3: one further thing to mention to you, Molly, is you
Speaker 3: know it's true you can talk about the Argentina examples
Speaker 3: and the Russia examples, but we know that governments are
Speaker 3: perfectly capable of sort of distorting and messing up economic statistics,
Speaker 3: not through any kind of ideological agenda, but just by
Speaker 3: not giving these agencies enough money and enough people. I
Speaker 3: noticed that. I mean, the UK has been getting itself
Speaker 3: into trouble recently on this, both on its labor statistics,
Speaker 3: which have been endlessly questioned, and they've had massive issues
Speaker 3: with the surveys. Just this week, I think they've announced
Speaker 3: that the main producer price index in the UK is
Speaker 3: going to be suspended for a few months because of
Speaker 3: nothing to do with the politics, but just because of
Speaker 3: concerns about the surveys. So you did a piece that
Speaker 3: rather sounded the alarm about this before any of this happened,
Speaker 3: before the inauguration, just looking at the long standing underfunding
Speaker 3: of these agencies, which I guess is what would make
Speaker 3: you a little bit more worried now is because they're
Speaker 3: not coming into this in fine fettle. They're actually already
Speaker 3: kind of being quite scrimped and tailed.
Speaker 2: Yeah, but these agencies have been underfunded for quite some time, and.
Speaker 3: That by administrations of both parties.
Speaker 2: Yes, the topic that really got me looking into this
Speaker 2: issue more broadly was last year when the BLS said
Speaker 2: it was going to have to cut the sample size
Speaker 2: of one of the surveys in the Jobs Report, and
Speaker 2: this is the survey that produces the unemployment rate and
Speaker 2: the participation rate, among others, and that's still a concern.
Speaker 2: They were able to stave off that sample size cut
Speaker 2: temporarily through some short term funding last year, but still
Speaker 2: TBD going forward. And this is exactly something that was
Speaker 2: coming up in these Advisory Committee meetings that how can
Speaker 2: we get that survey to be conducted online versus in person,
Speaker 2: And that's something the BLS has been trying to do.
Speaker 2: But guess what it costs money, So you need at
Speaker 2: least an initial investment before these things will cost less
Speaker 2: in the long run.
Speaker 1: Stephanie, I think our listener's list of concerns is probably
Speaker 1: not long enough, so can I add one more big one?
Speaker 3: Always?
Speaker 1: Last week, the IRS was reported to be close to
Speaker 1: reaching an agreement with Immigrations and Customs Enforcement, and under
Speaker 1: that agreement, that Customs Enforcement they agency known as ICE,
Speaker 1: would send names and addresses to the IRS, which is
Speaker 1: our tax collecting authority in the United States, and the
Speaker 1: IRS would verify the names and addresses. What on earth
Speaker 1: does that have to do with economic data. It strikes
Speaker 1: at the heart of the trust relationship between the government
Speaker 1: and respondents because when respondents agree to participate in a survey,
Speaker 1: they are assured in no uncertain terms that their responses
Speaker 1: will be used quote for statistical purposes only. That's exactly
Speaker 1: because respondents fear turning over valuable data to the United
Speaker 1: States government and having it potentially used for an enforcement purpose.
Speaker 1: They don't want to become criminally liable because they took
Speaker 1: the public spirited action of participating in an economic survey.
Speaker 1: So this IRS action risks setting a very damaging that
Speaker 1: could strike at the heart of the trust foundation of
Speaker 1: US economic data.
Speaker 2: And actually to that note, there was a note from
Speaker 2: Goldman Sachs, I think in the past week saying that
Speaker 2: the response rate to the Job's Household Survey by foreign
Speaker 2: born workers has already declined. So I mean, I don't
Speaker 2: think it would have been because of this already, since
Speaker 2: the IRS development that David was just talking about only
Speaker 2: just happened in the past week, but certainly reason to
Speaker 2: think that foreign born people in this country would have
Speaker 2: certainly less incentive to reply to government surveys.
Speaker 3: I mean, I guess we should say, Molly that the
Speaker 3: heads of these agencies have not been appointed or replaced
Speaker 3: by Donald Trump yet.
Speaker 2: That's correct. So the heads of these agencies, those are
Speaker 2: roles that are politically appointed. The vast majority of people
Speaker 2: who work in these agencies are civil servants, but the
Speaker 2: leads are political appointees. And right now there is actually
Speaker 2: one vacancy the Census direct Rob Santos. He's resigned from
Speaker 2: his role shortly after Trump was inaugurated, so Trump will
Speaker 2: have the chance to fill that role. I haven't heard
Speaker 2: anything yet about where the progress on that stands. But
Speaker 2: Census is really interesting because that was seems like in
Speaker 2: his first term, that was the agency that Trump seemed
Speaker 2: to square in on the most. Trump certainly has done
Speaker 2: that a lot, has said the jobs numbers are phony
Speaker 2: and fake. But when he's gone after census, it really
Speaker 2: has had to deal more with a question about citizenship
Speaker 2: and whether that should be included in the decential count.
Speaker 2: And this was an issue that went all the way
Speaker 2: up to the Supreme Court in his first term, and
Speaker 2: this is probably something that Trump will want to revisit
Speaker 2: this time around. The reason why it's so important is
Speaker 2: because people who respond to the census, this is used
Speaker 2: to then divvy up federal funding and congressional seats. So
Speaker 2: he has an interest then to say, if you know,
Speaker 2: if you're not a citizen, then you should not be
Speaker 2: included in the census, and then your district then should
Speaker 2: be not receiving appropriations and congressional seats as a result.
Speaker 2: So this is probably something that he would have a
Speaker 2: vested interest in taking on in this term.
Speaker 3: I'm just trying to step back a little bit as
Speaker 3: we kind of near the end of this there's a
Speaker 3: lot of things that people are worried about. Some would say,
Speaker 3: you know, hysterical about with regard to some of the
Speaker 3: things that this administration is doing, the kind of concerns
Speaker 3: that we've been talking about, And I mean, you're correct me, David,
Speaker 3: but it feels like there's kind of two different things.
Speaker 3: There's the extent of executive power, which definitely arises in
Speaker 3: this question around the firing of the commissioners and potentially
Speaker 3: officials other independent agencies, which as you pointed out, will
Speaker 3: be litigated, has already been chipped away by the Supreme Court,
Speaker 3: and they may yet decide that actually the president has
Speaker 3: a right to pire and fire people at these agencies
Speaker 3: that are to some extent already implement the administration's policies.
Speaker 3: That seems to be one set of things which is
Speaker 3: about the nature of executive power, and you can disagree
Speaker 3: about that. But there's a whole other set of things
Speaker 3: that I think relate more to these this question of
Speaker 3: the statistics and the independence of the statistics, which is
Speaker 3: around whether there's oversight over the quality of these statistics
Speaker 3: and whether there could be lasting problems arising from things
Speaker 3: that administration has done which may not even be intentional.
Speaker 3: Just on those second set of things, how much do
Speaker 3: you David see the scope for distorting data or just
Speaker 3: having it be kind of fundamentally undermined by things that
Speaker 3: are happening.
Speaker 1: Well, the tradition in the United States is very strong.
Speaker 1: The agencies have coded in their DNA that they resist
Speaker 1: political interference. The most notorious example of this in history
Speaker 1: occurred in the administration when President Nixon was caught on
Speaker 1: tape from the Oval Office expressing really venomous views about
Speaker 1: how he felt that the Bureau of Labor Statistics, the
Speaker 1: agency that, as Molly mentioned, generates the unemployment rate and
Speaker 1: other key data, how they were out quote unquote to
Speaker 1: get him, and he was determined to undermine them.
Speaker 3: You know what's brilliant is that is not the thing
Speaker 3: that most people remember about President Nixon, that he was
Speaker 3: out to undermine the of Labor Stistics, and I did
Speaker 3: not know it until now. So I think that thank
Speaker 3: you for that.
Speaker 1: Absolutely. A through line for both of the issues that
Speaker 1: you described, Stephanie, is the question of trust, And as
Speaker 1: in many areas of life, trust in these areas that
Speaker 1: you were describing is very difficult to accumulate. Building it
Speaker 1: up is the work of years, decades, if not generations.
Speaker 1: Destroying trust can happen, and in a jiffy it can
Speaker 1: trust can be devastated through a single action, and that
Speaker 1: damage is extremely difficult to repair. So that in this
Speaker 1: there are a lot of things that keep me up
Speaker 1: at night in this area, that's the one that keeps
Speaker 1: me up at night most.
Speaker 3: I think we decided that if it keeps David Wilcox
Speaker 3: up at night, given his many years of experience at
Speaker 3: things that matter very deeply to Trump and Nomics, that
Speaker 3: was worth an episode. Thank you very much, David, Thank you, Molly.
Speaker 1: Thank you, Thank you for having us on to discuss
Speaker 1: these important issues.
Speaker 3: Thanks for listening to Trump Andomics from Bloomberg. It was
Speaker 3: hosted by Me Stephanie Flanders. I was joined by David
Speaker 3: Wilcox and Molly Smith. Trump and Nomics is produced by
Speaker 3: Samasadi and Moses and with help from Chris Martlu and
Speaker 3: Amy Keene and sound designed by Blake Maple's Brendan Francis
Speaker 3: Newnham is our executive producer and to help others find
Speaker 3: the show, please rate it and review it highly wherever
Speaker 3: you listen to podcasts