U.S. Leader Fires Economic Data Collector. History Shows the Perils.

Economists say unbiased data is essential for policymaking, and for democracy.

Excerpt: "It was a move with few precedents in the century-long history of economic statistics in the United States.

And for good reason: When political leaders meddle in government data, it rarely ends well.

There is the case of Greece, where the government faked deficit numbers for years, contributing to a debilitating debt crisis that required multiple rounds of bailouts. The country then criminally prosecuted the head of statistical agency when he insisted on reporting the true figures, further eroding the country’s international standing.

There is the case of China, where earlier this century the local authorities manipulated data to hit growth targets mandated by Beijing, forcing analysts and policymakers to turn to alternative measures to gauge the state of the country’s economy.

Perhaps most famously, there is the case of Argentina, which in the 2000s and 2010s systematically understated inflation figures to such a degree that the international community eventually stopped relying on the government’s data. That loss of faith drove up the country’s borrowing costs, worsening a debt crisis that ultimately led to it defaulting on its international obligations.

It is too soon to know whether the United States is on a similar path.

But economists and other experts said that Mr. Trump’s decision on Friday to fire Erika McEntarfer, the Senate-confirmed head of the Bureau of Labor Statistics, was a troubling step in that direction."