President Donald Trump is making a concerted effort to put MAGA loyalists in charge of the U.S. Bureau of Labor Statistics (BLS) and the U.S. Federal Reserve.
At press conferences, Trump repeatedly attacks Fed Chairman Jerome Powell as a “stupid person” because he is refusing to cut interest rates — at least for now. And on Friday, August 1, Trump fired BLS Commissioner Erika McEntarfer in response to a disappointing jobs report and accused her, with zero proof, of “rigging” the numbers.
Trump’s critics, including liberal economists Paul Krugman and Robert Reich, are emphasizing that it is crucial for positions like BLS commissioner and Fed chair to remain adamantly nonpartisan. And former Fed official David Wilcox, during an interview with Politico’s Victoria Guida published on August 6, warned that Trump could inflict major damage on “economic policymaking” if he succeeds in politicizing those positions.
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Wilcox, who spent years doing economic forecasting at the Fed and now serves as director of U.S. economic research for Bloomberg Economics, told Guida, “I think some of the damage that has already happened pertains to the predicament of the next person who will hold the job of being commissioner of the BLS. There will be persistent concern about whether that person was installed in order to do the president’s bidding rather than in order to fulfill the mission of the BLS to deliver the best estimates of the facts on the ground as best as they can be discerned in a chaotic world.”
Wilcox emphasized that the BLS, like the U.S. Census Bureau and the U.S. Bureau of Economic Analysis (BEA), must remain a “nonpartisan, data-oriented, completely analytical operation of the government.”
“I’m extremely worried about the future of the statistical system,” Wilcox told Guida. “Let me give you one stark fact to underscore just how concerned I am. The (Trump) Administration proposed, in their budget for fiscal year 2026, an 8 percent nominal cut to the spending amount that’s authorized for the BLS and an 8 percent reduction in their authorized (full-time employees). That comes on top of a period of probably 15 years of budgetary starvation for the statistical agencies. They are not in a position to sustain that kind of cut.”
Guida asked Wilcox how the Fed and Wall Street would be affected if “BLS data was no longer available to the public” or “people no longer see its data as reliable.”
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Wilcox responded, “You’re asking me to contemplate the nuclear scenario…. The information foundation for all kinds of decision-making would be significantly damaged. There is a bunch of sort of optimistic talk of that, gosh, with the emergence of big data from so many sources that it’s possible to construct alternative indicators and we could get along. But what isn’t widely appreciated is that the value of those alternative indicators depends greatly on being able to rely on the outputs of the BEA, BLS and Census Bureau as the starting point, the agreed-upon foundation from which the alternative indicators will be built. Economic policymaking, monetary policymaking would continue; the quality of decisions that would be feasible to make under those circumstances would be badly damaged.”
The former Fed official added, “Monetary policy is hard enough as it is, with statistics that are widely agreed to be reliable and the best possible professional estimates, given the resources available to the agencies.”
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Victoria Guida’s full interview with David Wilcox for Politico is available at this link.