The Only Good Bureaucrat

Today we learn the United States consumer is less formidable than previously imagined.

His savings are heavily depleted. He pegs along on rations increasingly lean.

Zero Hedge:

Instead of the 1.7% unchanged print from the second estimate of Q2 GDP, the final number was a dire 0.8%, a 9-sigma miss to estimates… and the worst quarterly increase since the COVID collapse in Q2 2020.

The worst quarterly increase since the COVID collapse in Q2 2020? Kind heaven, no.

Have we here the harbinger of recession? We do not know. Yet it is perhaps… as the phrase runs… a “straw in the wind.”

We further learn that personal consumption in each quarter since Q1 2022 has endured a subsequent revision — a downward revision — and at times a handsome one.

We learn — further yet — that since 2017 United States households saved $1.1 trillion less than previously estimated.

“Whatever the reason for the statistical adjustment,” continues Zero Hedge, “one can say goodbye to even the faintest speculation that U.S. households have any excess savings left…”

We hazard Zero Hedge is correct. More:

Every single monthly payrolls print in 2023 has been revised lower, a 12-sigma probability.

“Almost Zero”

“Sigma,” in the statistical symbology, equals standard deviation from the mean.

Thus a 12-sigma event equals 12 standard deviations from the mean.

How likely is a 12-sigma event? ChatGPT was sufficiently kind to answer:

The probability of an occurrence at 12 standard deviations above the mean in a normal distribution is extremely low. In fact, it is almost zero.

“Almost zero.”

Yet here we have a 12-sigma occurrence on our hands.

What does this speak for the government “statisticians” who endlessly botch the data… to the point of 12 standard deviations?

Very, very little.

Concludes Zero Hedge:

[This is] virtually impossible unless there was political pressure to massage the data higher initially and then revise it lower when nobody is looking.

We are convinced of it. Let us turn our attention toward these politically pressured statisticians…

Data-Torturers

It is these government statisticians who collect, sort, worry, goon, torture and weaponize economic data.

It is they who stretch the numbers upon the torture rack and proceed against them in truly barbarous fashion — until the numbers confess.

It is they who throw false weights upon scales in support of government policy x or government policy.

If the government adds one cup of inflationary water to one cup of whole milk… do you have two cups of milk?

Government statisticians will say you do. Yet two cups of watered milk do not constitute two cups of whole milk.

They constitute a vast fiction.

Yet if the administration requests a vastly exaggerated GDP reading, they will torment the numbers into compliance.

If the administration requests a vastly reduced inflation reading, they will torment the numbers into compliance.

If the administration requests a vastly reduced unemployment reading… they will torment the numbers into compliance.

They would tell you twice two is not four — that it is five, 11 or 343 trillion — if it advanced their interests.

In short: We trust government statistics no further than we trust a dog with our dinner.

How can they make such heavy weather of the numbers?

Implements of Numerical Torture

This they accomplish through the aggressive use of “seasonal adjustments” and other such implements of numerical torture.

Seasonal adjustments are intended to clarify… to distinguish true signal from distracting noise… to flatten seasonal bumps and variations.

Yet in the hands of government number-torturers, they do not clarify. They obfuscate and mislead.

They distribute not light but fog.

In these hands seasonal adjustments are as authentic as a false set of teeth, a bald man’s toupee or a congressman’s handshake.

A seasonal adjustment is — after all — a statistical technique. And statistics in the wrong hands is a gun in the wrong hands.

As we have argued previously: That is precisely why the government statistician constitutes a vast menace.

For without statistics the government is nothing but thumbs, a plodding doofus.

It is a fumbling cyclops speared through its one and only eye.

Statistics guide and steer it.

The “Eyes and Ears” of Government

Statistics constitute the “eyes and ears” of government:

Explains the late libertarian economist Murray Rothbard:

Certainly, only by statistics, can the federal government make even a fitful attempt to plan, regulate, control or reform various industries — or impose central planning… on the entire economic system. If the government received no railroad statistics, for example, how in the world could it even start to regulate railroad rates, finances and other affairs? How could the government impose price controls if it didn’t even know what goods have been sold on the market, and what prices were prevailing?

Statistics… are the eyes and ears of the interventionists: of the intellectual reformer, the politician and the government bureaucrat. Cut off those eyes and ears, destroy those crucial guidelines to knowledge and the whole threat of government intervention is almost completely eliminated.

Indeed… in the absence of labor statistics, how would the government know when to “stimulate” the economy?

And how would its central bank plot the famously false Phillips curve?

That is, without statistics the government could not “govern” us as it would.