The Jobs Con Job

 

It was September 2012. Unemployment had been over 8% since Obama had taken office. “I don’t know much,” my neighbor said to me, “But I know this: The unemployment rate next month will be 7.9%.”

In the event, the reported rate was a much-heralded 7.8%, undermining Romney’s message that the country needed a better steward of the economy, and giving Obama a boost going into the November election. Outside of the MSM echo-chamber, however, skeptics noted anomalies in the data. The anomalies suggested inaccuracy at best, malfeasance at worst. Even Jack Welch, the former CEO of GE, tweeted, “Unbelievable jobs numbers…these Chicago guys will do anything…can’t debate so change numbers.” The skeptics were vindicated a year later when John Crudele of the New York Post uncovered that the Census Bureau had, in fact, faked the data.

To calculate the unemployment rate, it would be ideal to know the employment status of every person in the country: working, looking for work, retired, in school, etc. In a country of 300+ million people, that is impractical. Instead, the Census Bureau conducts a survey each month. As with all surveys, there is sampling error and the value is really valid only within some range of error. Even so, in 2012 — and perhaps long before and after — Census Bureau employees falsified some underlying survey data.

Crudele has stayed on the beat, and last week published a remarkable story on continuing malfeasance at the Bureau. Fortunately, a whistleblower has stepped forward and congress is investigating (emphasis added):

A field supervisor in the Census Bureau’s Denver region has informed her organization’s higher-ups, the head of the Commerce Department and congressional investigators that she believes economic data collected by her office is being falsified.

And this whistleblower — who asked that I not identify her — said her bosses in Denver ignored her warnings even after she provided details of wrongdoing by three different survey takers.

The three continued to collect data even after she reported them.

When I spoke with this whistleblower earlier this year as part of my investigation of Census, she told me that hundreds of interviews that go into the Labor Department’s unemployment rate and inflation surveys would miraculously be completed just hours before deadline.

The implication was that someone with the ability to fill in the blanks on incomplete surveys was doing just that.

The Denver whistleblower also provided to the House Committee on Oversight and Government Reform the names of other Census workers who can spill the beans about data fraud in other regions.

As we head into the 2014 midterms next month, the (reported) unemployment rate has continued to drop, from 6.1% in August to 5.9% in September. As Crudele describes:

In fact, about a third of the recent decline in the unemployment rate can be attributed to a decline in the so-called Labor Participation Rate, which is now at a 36-year low. Ninety-six million Americans no longer consider themselves in the labor force.

Some think there is a logical explanation for this: baby boomers who are leaving the workforce because they simply don’t want to work anymore. But the data doesn’t bear that out.

There were 230,000 more workers aged 50 or older in the Household Survey released Friday. So how did the workforce decline by 315,000 people, if aging baby boomers were increasingly looking for jobs?

It’s either a miracle or someone’s pulling our leg.

So to recap: a government agency is out of control, systematically lying to the American people to make the Democrats look good. On the plus side — and in contrast to other scandals — a whistleblower has stepped forward and congress is investigating.

But frankly, I’m pessimistic. With the MSM unwilling to give these stories the attention they deserve, I doubt any elected official — Democrat or Republican — will have sufficient will or incentive to do the required housecleaning.

Image Credit: Shutterstock.

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  1. EThompson Inactive
    EThompson
    @EThompson

    In other words, the deck is stacked.

    Most of us here at Rico know this, I believe. What can we do to defend ourselves?

    • #1
  2. Rightfromthestart Coolidge
    Rightfromthestart
    @Rightfromthestart

    I see two other problems in the future , one is that once the integrity of ‘government figures’ is in question it can never really be recovered, the other is that when , if ever, the Republicans have control of the executive branch any attempt to remove the miscreants will be called ‘politicizing’ non-partisan offices. They have done it in the past first politicize the department and then shriek that any attempt to return to the status quo is unthinkable. They are simply smarter and way sneaker than our side.

    • #2
  3. Xennady Member
    Xennady
    @

    The people who should be exposing this criminality are Republican candidates for office.

    Tell the voters that the regime is lying to them, because it is. Use words like “crime” and “lie.”

    Back it up with the facts, because you can.

    Stop whining that the leftist media won’t carry your water.

    Make the media’s endless deceit part of the story, and tell the public that the media is nothing more than a swarm of democrat operatives with bylines, as Glen Reynolds notes.

    Above all, stop whining.

    It wins no votes. Fight back.

    • #3
  4. MarciN Member
    MarciN
    @MarciN

    Xennady: Back it up with the facts, because you can.

    I agree with this.  There are millions of dollars in campaign money available. And there are the Republican members of Congress, and their 60-person staffs. We need to produce our own credible figures.  This should be a no-brainer.

    • #4
  5. user_435274 Thatcher
    user_435274
    @JohnHanson

    Nothing will happen, until Republicans elect a president, then slowly, lies will change to truth, so what we see will be worsening employment (back to actual data) even if economy is improving, so Republicans will be blamed for fixing the numbers.

    • #5
  6. Xennady Member
    Xennady
    @

    MarciN:

    Xennady: Back it up with the facts, because you can.

    I agree with this. There are millions of dollars in campaign money available. And there are the Republican members of Congress, and their 60-person staffs. We need to produce our own credible figures. This should be a no-brainer.

    Exactly. At the very least the party should be pointing out the figures get better before each election, then suddenly worse after.

    • #6
  7. C. U. Douglas Thatcher
    C. U. Douglas
    @CUDouglas

    In America at least, the use of statistics to bolster a party’s reputation rather than provide point-in-time data has been a fairly new phenomena. This coincides fairly recently with the election of Pres. Obama. Of course, the last two Democratic presidents where Clinton – under whom the economy was still soaring from the eighties and the tech boom – and Carter – where fudging data hadn’t been a strategy.

    This isn’t the only place where the numbers are cooked. Again, I like to point at California’s “budget surpluses” which amount to a metric crud-ton of accounting gimmicks so that the Democratic government in power can point and say they are following the balanced budget laws. Also of similar consequence is the data on Global Warming where trends were fudged and data collection points were tainted but never corrected.

    Data can be great for point-in-time analysis if it is gathered and delivered accurately. Now data collection has been corrupted almost entirely for propaganda purposes. For the time being, Progressives and their supporters will use that as a hammer to show how great things are under Progressive rule. If this continues in the long run, we will get what happens in most Progressive-run societies: the knowledge that the government bald-face lies about how great things are compared to how rotten they really are and the acceptance that this is just how things are and nothing can really be done about it.

    Strangely, nowadays it takes courage to point to the uncomfortable truth. Too many don’t want to risk the consequences of correctly calling someone a liar and identifying their stories as lies. Now is the time to do it, before we accept that the lies happen and there’s nothing to do but carry on as usual.

    • #7
  8. liberal jim Inactive
    liberal jim
    @liberaljim

    Both parties are corrupt.  The investigation will go no where because the GOP believes it is in their best interest that the country does not grasp the fact that the establishment of both parties have been sticking it to them for decades.  It is a known fact the body counts from Vietnam were routinely falsified and I assumed most thinking people took all government  numbers since then as nothing but fiction.  The idea that a employment number that is arrived at by phoning households has any validity  is an absurdity.  The only people who treat these numbers as meaningful are government bureaucrats and their fellow parasites that are laughingly referred to as journalists.  Portraying the dems  harlots and repubs as virgins who happen to be working in the same whorehouse is getting old.

    • #8
  9. gts109 Member
    gts109
    @gts109

    Wow, amazing. Why isn’t this bigger news?

    Also, Mickey Kaus predicted this very phenomenon back in 2012, saying that BLS analysts are mostly Dems and that “[h]uman beings will lie if the stakes are high enough.” He didn’t posit some grand conspiracy, just that people in bureaucracies understand the stakes of presidential elections and will act in their own interests. My fav quote from his piece:

    Thousands of leftish census workers, acting without central direction, made hundreds of thousands of subjective judgments that erred on the side of painting a positive September employment picture in order to boost Team O? That’s … actually not all that implausible, is it?

    • #9
  10. Paul A. Rahe Contributor
    Paul A. Rahe
    @PaulARahe

    Is there any agency in the government that one can still trust?

    • #10
  11. user_1938 Member
    user_1938
    @AaronMiller

    Rightfromthestart: when , if ever, the Republicans have control of the executive branch any attempt to remove the miscreants will be called ‘politicizing’ non-partisan offices. They have done it in the past first politicize the department and then shriek that any attempt to return to the status quo is unthinkable.

    Let them shriek. If a President does this in his first or third year in office, most voters won’t even remember by election time.

    Only Republicans fear being partisan.

    • #11
  12. user_1938 Member
    user_1938
    @AaronMiller

    gts109: Also, Mickey Kaus predicted this very phenomenon back in 2012, saying that BLS analysts are mostly Dems and that “[h]uman beings will lie if the stakes are high enough.” He didn’t posit some grand conspiracy, just that people in bureaucracies understand the stakes of presidential elections and will act in their own interests.

    Rush Limbaugh predicted it as well.

    • #12
  13. Son of Spengler Contributor
    Son of Spengler
    @SonofSpengler

    C. U. Douglas: Now is the time to do it, before we accept that the lies happen and there’s nothing to do but carry on as usual.

    Also, while the rot seems to have thoroughly permeated the Census Bureau, the BLS appears to still be populated by professionals. (Which makes some sense, because the ACORN types have enough quantitative knowledge to fake surveys but not to conduct actual economic analysis.) Now is the time to clean house, before the rot spreads to BLS.

    • #13
  14. Seawriter Contributor
    Seawriter
    @Seawriter

    It is easier to convince folks things are worse than they are than things are better than they are.

    If you are unemployed or underemployed being told everyone else has a great job and we are in Recover Summer (or Autumn or Winter or Spring) is cold comfort.  It is great everyone else has things good, but what about me?  And all my buds that cannot find work, or are only working part-time flipping burgers, despite having a masters in sociology?

    On the other hand, if you (and your friends) are gainfully employed, and you are hearing a constant drumbeat about how there are armies of unemployed and everyone else is just two paychecks away from becoming homeless, you are likely to buy into that.  After all, you might have it good, but look at all those other poor, suffering people. (In a nation of 300 million plus you can fill a 24-hour news channel with stories of different poor, suffering, unemployed people, who are victims of hard luck, even with 2% unemployment.) You worry it might happen to you.

    I don’t think folks are buying the “good times” scenario being sold by the official figures.

    Seawriter

    • #14
  15. Seawriter Contributor
    Seawriter
    @Seawriter

    Paul A. Rahe:Is there any agency in the government that one can still trust?

    That is one of them rhetorical questions, right?  It is just rhetorical? Right? . . . Right?

    Seawriter

    • #15
  16. Son of Spengler Contributor
    Son of Spengler
    @SonofSpengler

    gts109: Wow, amazing. Why isn’t this bigger news?

    Yes, I agree this should be bigger news. Is it being ignored by the MSM because the inconvenient facts don’t fit the narrative? Or perhaps because of scandal fatigue? Either way, I find that aspect the most depressing. If the MSM doesn’t do its job, and the American people don’t care enough to seek out better news sources, and the GOP doesn’t pursue the matter — then this behavior just becomes the normal way the bureaucracy operates.

    gts109: Also, Mickey Kaus predicted this very phenomenon back in 2012, saying that BLS analysts are mostly Dems and that “[h]uman beings will lie if the stakes are high enough.”

    I think the BLS is (so far) operating above-board. In fact, one of the ways we see the Census Bureau is fudging data is by comparing with BLS’s “establishment survey”, which paints a much more grim employment picture.

    • #16
  17. user_82762 Thatcher
    user_82762
    @JamesGawron

    Son,

    Great Post!  You are on the target now.  I think that there would be enough support by a wide spectrum of economists to substantiate the fact that if we used the formula used in 2001 the unemployment rate today would be over 12%!  That needs to be stated every chance we get.  Nobody believes the Obamites anymore.  If we just start punching with this truth I think this wall will fall down.

    Regards,

    Jim

    • #17
  18. gts109 Member
    gts109
    @gts109

    It’s right to distinguish between BLS and Census, and in fairness to Kaus, he did so, making two separate arguments, one about mid-level analysts at BLS massaging data and another about lower-level Census workers fudging it.

    • #18
  19. user_130720 Member
    user_130720
    @

    Son of Spengler: If the MSM doesn’t do its job, and the American people don’t care enough to seek out better news sources, and the GOP doesn’t pursue the matter — then this behavior just becomes the normal way the bureaucracy operates.

    We lionize our lyin’ eyes and go blind in the process.

    • #19
  20. chorton65@comcast.net Inactive
    chorton65@comcast.net
    @GoldwatersRevenge

    While falsifying employment statistics is egregious enough I feel the false data going basically unchallenged in the “global warming” aka ” climate change” debate is even worse. The administration and most Dems rate climate change as the worst theat to America today but rely only on hand picked data. Most data comes from research grants and only those favoring the climate change theory are likely to receive grants.

    These so called scientist blindly accept the mantra that climate change is a “settled science” when any true scientist knows that by definition a theory is that which can be disproved. Even the far more settled science of evolution is still considered a theory and therefore disprovable. If the Dems get their way and stricter carbon emission regs are enacted 8 per cent unemployment will look very good indeed.

    • #20
  21. gts109 Member
    gts109
    @gts109

    To harp on the MSM: This scandal, although it involves a dry subject matter (statistics and how bureaucracies compile them), is what movies are made of! How many pictures have we seen where the public is misdirected by a conspiracy to help the president get re-elected (Wag the Dog was on TV the other day)?

    Maybe this wasn’t a conspiracy and maybe it doesn’t reach up very high in the administration (two assumptions, btw), but the public was apparently lied to on the number one issue in the election (jobs)! How is this not deeply, fundamentally disturbing? It creates questions of corruption and incompetence in federal agencies, and perhaps some deeper issues about democracy in general.

    • #21
  22. user_6236 Member
    user_6236
    @JimChase

    Well, I suppose it just wouldn’t do to have another “Jobless Recovery”, now would it, despite the fact that this one seems more real than the one trumpeted by Pelosi and crew back some 8 years ago.

    What to do, when you can’t trust the purveyors of data, nor those who report on it?  Monitor your salt intake.

    • #22
  23. PHCheese Inactive
    PHCheese
    @PHCheese

    I may be mistaken but I thought retired were no longer considered in the labor participation pool.

    • #23
  24. Son of Spengler Contributor
    Son of Spengler
    @SonofSpengler

    PHCheese:I may be mistaken but I thought retired were no longer considered in the labor participation pool.

    Correct. The U-3 (headline) unemployment rate is defined as the fraction of the workforce (i.e., those working plus those seeking work) that is unemployed. The way Census finds the workforce’s size is by asking people in their surveys whether they are working, or looking, or none of the above.

    A paradoxical result is that the unemployment rate can drop when the size of the workforce shrinks — when people decide to stop looking for work. During Obama’s tenure, the drop in the unemployment rate has been influenced — significantly — by a drop in workforce participation. Some of that is real, as evidenced by ballooning numbers of people going on disability. But some of it may be the result of the shenanigans at Census.

    • #24
  25. AIG Inactive
    AIG
    @AIG

    There’s several things here which need to be considered:

    1) Census hiring is not “cheating” or a “con job”. Whether it shows up in employment surveys or not, is irrelevant. It won’t show up the next month. That’s hardly a …con job.

    Plus there’s ways to…seasonally adjust…which necessarily happens after the fact. That’s not a con job either. If you look at the following unemployment survey results, you’ll see that indeed there was a big adjustment to get rid of the census hiring. That’s how these surveys work.

    2) There’s 1 report by 1 person in Denver speaking of “wrongdoing” by low-level data collectors. It’s hard to imagine any situation where there are hundreds if not thousands of data collectors, where you won’t find instances of…THREE…people having some “wrongdoing”. That’s hardly evidence of a massive multi-departmental conspiracy to fabricate employment data.

    3) Hundreds of surveys showing up before the deadline is, probably, just the phenomenon of people getting them into their systems in the last minute. It does not mean the data was collected at that last minute.

    Keep in mind these surveys are collected by regional offices, which hire relatively low-level people to do the data collection.

    4) The last part on the “baby boomers” is just silly. There’s other people in the economy, besides baby boomers, and actually the largest decrease in labor participation rates is among the young.

    So again, this is hardly evidence of anything at all, other than the Denver office apparently having problems with its low-level surveyors.

    This is really really weak evidence of anything at all.

    PS: Which might explain why no one has paid attention to this “massive con job”. Because it’s no such thing. Anyone who has knowledge of how these surveys are conducted, should know better.

    • #25
  26. gts109 Member
    gts109
    @gts109

    Yeah, AIG, I’m sure all the reporters at the NY Times are ignoring this because of their deep knowledge of how Census and BLS work. Lulz.

    • #26
  27. AIG Inactive
    AIG
    @AIG

    gts109:Yeah, AIG, I’m sure all the reporters at the NY Times are ignoring this because of their deep knowledge of how Census and BLS work. Lulz.

    Or maybe the evidence just isn’t there at all.

    It’s hard to accuse some entity of “a con job” when they make data publicly available.

    Maybe the answer as to why the “baby boomers” don’t explain the fall in participation rates might have been explained by a 30 second Google search on labor rate participation by age:

    Civilian_Labor_Force_Participation_Rate_by_Age

    Notice where the decline is?

    • #27
  28. AIG Inactive
    AIG
    @AIG

    PS: There’s thousands of people who work on these surveys, with multiple layers of management. There’s lots of white papers the BLS puts out on their survey methodology etc. Many of these people have been at the BLS for many years and are far from “political hires”. Not one of these people would have picked up on this “fraud”?

    There’s thousands of economists who use this data for various projects, many of whom get it directly at the BLS central location where the raw data is available.

    You’d think, that one of these thousands of economists, might have picked up on some “data manipulation”. They’re good at that stuff. But, nothing.

    • #28
  29. Son of Spengler Contributor
    Son of Spengler
    @SonofSpengler

    AIG: It’s hard to accuse some entity of “a con job” when they make data publicly available.

    If only. The Census Bureau’s raw survey data are not publicly available (and are not even made available to BLS, if my understanding is correct). Public release of the raw data would allow parties outside the Bureau to run statistical checks that would indicate whether variations are consistent with randomness or not.

    The meat of the article — and the possible scandal — is not the declining participation rate. It’s that a whistleblower has accused superiors of (at best) looking the other way when data were questionable, or (at worst) conspiring to falsify data. The whistleblower turned over 1000 emails and other documents to congress in support of the allegations. Admittedly, we are talking about a single anonymous whisteblower. Perhaps his or her allegations are fake, or misguided, or a disgruntled employee is trying to cause trouble. But these are serious allegations that any curious reporter would want to get to the bottom of.

    • #29
  30. user_82762 Thatcher
    user_82762
    @JamesGawron

    AIG:There’s several things here which need to be considered:

    1) Census hiring is not “cheating” or a “con job”. Whether it shows up in employment surveys or not, is irrelevant. It won’t show up the next month. That’s hardly a …con job.

    Plus there’s ways to…seasonally adjust…which necessarily happens after the fact. That’s not a con job either. If you look at the following unemployment survey results, you’ll see that indeed there was a big adjustment to get rid of the census hiring. That’s how these surveys work.

    2) There’s 1 report by 1 person in Denver speaking of “wrongdoing” by low-level data collectors. It’s hard to imagine any situation where there are hundreds if not thousands of data collectors, where you won’t find instances of…THREE…people having some “wrongdoing”. That’s hardly evidence of a massive multi-departmental conspiracy to fabricate employment data.

    3) Hundreds of surveys showing up before the deadline is, probably, just the phenomenon of people getting them into their systems in the last minute. It does not mean the data was collected at that last minute.

    Keep in mind these surveys are collected by regional offices, which hire relatively low-level people to do the data collection.

    4) The last part on the “baby boomers” is just silly. There’s other people in the economy, besides baby boomers, and actually the largest decrease in labor participation rates is among the young.

    So again, this is hardly evidence of anything at all, other than the Denver office apparently having problems with its low-level surveyors.

    This is really really weak evidence of anything at all.

    PS: Which might explain why no one has paid attention to this “massive con job”. Because it’s no such thing. Anyone who has knowledge of how these surveys are conducted, should know better.

    AIG,

    I think we are missing the forest for the trees here.  The problem isn’t the minutiae of the survey methodology but the whole premise.  Slowly the meaning of the word unemployment has been massaged nearly out of existence.  Like the frog being slowly brought to a boil the American people have been led to believe that there is an improved economy with a lower unemployment rate.  All that Obama has done is manipulate the formula by which unemployment has been measured.  It is an artificial improvement.  You know, like hockey stick artificial global warming, or an artificial bombing campaign that couldn’t stop kids playing hookie much less ISIS.

    Of course, almost everything about the Obama administration is artificial.  Why not this too.

    Regards,

    Jim

    • #30

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