New York
\n \u00a0\u2014\u00a0<\/p>\n
\n The economic warning lights are all going off.\n <\/p>\n
\n Giant tariffs are up in the air, once again. No official economic data will come out during the government shutdown. And once the business of the US government does resume, it\u2019s anyone\u2019s guess who the president will tap to run the Bureau of Labor Statistics now that the administration has been forced to claw back its disastrous first pick.\n <\/p>\n
\n Let\u2019s step back on the off-chance that the reliability of government statistics wasn\u2019t your top priority this week\u2026\n <\/p>\n
\n In normal times, when the US government is functioning, we the people are entitled to a steady stream of reports that allow us to take the temperature of the US economy. In these not-normal times, when the federal government has shut down, that data stream dries up because the agencies that produce them can\u2019t staff their operations without funding from Congress.\n <\/p>\n
\n That means the monthly jobs report from the Bureau of Labor Statistics, which should have landed this Friday, won\u2019t arrive until the shutdown ends. Ditto two key inflation reports due in the coming weeks.\n <\/p>\n
\n Without those reports, investors, policymakers and business leaders \u2014 already navigating the uncertainty of Trump\u2019s on-again-off-again tariffs, his attempted takeover of the Federal Reserve, sporadic bailouts<\/a> of select foreign nations and random social media outbursts<\/a> \u2014 are flying blind.\n <\/p>\n \n The longer the shutdown lasts, the more indicators may be delayed, and the more uncertainty takes over. Without a full staff, the BLS can\u2019t collect employment data, which means the September and October reports could both be delayed.\n <\/p>\n \n \u201cThe shutdown adds to the significant policy uncertainty and volatility that we\u2019ve seen this year from tariffs, court cases, government staff reductions, and threats to the independence of statistical agencies and the Fed,\u201d Brett House, a professor at Columbia Business School, said in an email Wednesday. \u201cAll of this could, at the margin, create a chilling effect on hiring and investment amongst private-sector companies that could dent growth.\u201d\n <\/p>\n \n The shutdown is just the latest debacle for the BLS, an agency that has been chronically understaffed and underfunded for years.\n <\/p>\n \n Two months ago, Trump fired the head of the agency, Erika McEntarfer, claiming, with zero evidence, that she\u2019d somehow rigged the numbers that made his economy look bad.\n <\/p>\n \n (In reality, Trump\u2019s tariffs appear to be the biggest culprit behind the weakening of the US economy, particularly when it comes to small and medium-size businesses that lack the financial flexibility that giant corporations have to absorb the added costs. Shooting the messenger doesn\u2019t change the data<\/a>, it turns out.)\n <\/p>\n \n To replace McEntarfer, Trump nominated a loyalist, Heritage Foundation economist EJ Antoni<\/a>.\n <\/p>\n \n But the White House on Tuesday abruptly withdrew Antoni\u2019s name from consideration, as it looked increasingly like his confirmation would be a losing battle.\n <\/p>\n \n In addition to Antoni\u2019s lack of experience, which concerned conservative and liberal economists alike, and his \u201cbystander\u201d status at the January 6, 2021, attack on the Capitol, CNN\u2019s KFile team<\/a> unearthed an old Twitter account of his that was, well, pretty gross. (The account included sexually degrading comments about Kamala Harris, anti-gay remarks, a smorgasbord of conspiracy theories and all manner of crude insults aimed at critics of Trump.)\n <\/p>\n \n A White House official didn\u2019t directly address the reason for yanking his nomination, saying Antoni \u201cis a brilliant economist and an American patriot that will continue to do good work on behalf of our great country.\u201d The official added that Trump would announce a new BLS nominee soon.\n <\/p>\n \n Which brings us back to the uncertainty issue.\n <\/p>\n \n It almost doesn\u2019t matter whom Trump nominates to oversee the BLS next. By firing McEntarfer, even on his baseless claim of corruption, he\u2019s sowed doubt in independent agencies\u2019 reliability (see also: the Fed) at the worst possible time for the economy.\n <\/p>\n