In 1492, it took Christopher Columbus’s three ships more than three months to make landfall in what he believed was Asia, but was in fact the New World. To keep his sailors from mutinying as the days and weeks passed with the precarious little ships moving farther away from Spain, and no sign of terra firma, the Admiral of the Ocean Seas kept two ship’s logs: a secret one indicating the accurate distances the flotilla traveled each day; the other a fake log showing that the explorers had traveled a much shorter distance. Columbus shared this log with his sailors to calm their anxieties about being far from home.
In short, the Discoverer cooked the books.
Five hundred years later, cooking the books became an unfortunate feature of company practice in a series of notorious episodes of corporate financial fraud. Enron became an early 21st century poster child for book cooking in order to appear much better to shareholders than its actual performance would warrant. A few years later, the now defunct Lehman Brothers did something similar that went a long way to triggering the Great Recession. It was not alone among its Wall Street brethren when it came to lying about its finances. Subsequently, the Trump Organization was found guilty of cooking the books, first to shower senior executives with perks in order to evade paying taxes; then again to cover up the true purpose of what came to be labeled “hush money” payments to Trump’s paramours.
Book cooking became a “thing” on Day One of Trump’s first term, when he and his horseholders insisted that his inauguration crowd was the largest ever, an absurdity easily disproven by photographic images. Then, during his tenure, there were attempts to intimidate career civil servants tasked with collecting and reporting economic and other statistics when they were not favorable to the administration. These efforts included multiple, and fortunately unsuccessful, attempts to distort the accuracy and legitimacy of census population counts used to distribute seats in the House of Representatives, draw electoral districts, and allocate more than $1.5 trillion annually in federal funding; 1,400 changes to federal agency websites that eliminated science-based information on climate change and environmental issues (per Silencing Science Tracker); harassment of the Bureau of Labor Statistics (BLS) when its data (e.g., economic growth, unemployment rates, rate of inflation) did not reflect positively on the administration; and threats against the independence of the Federal Reserve when it did not lower interest rates. Because Trump and his MAGA advisors were government greenhorns, the Era of Alternative Facts was just getting started, and there were still some guardrails, as well as guardians of the public trust in high positions, the damage was for the most part, contained.
Containment will be less likely the second time around. The cabinet and other senior appointees Trump has chosen for the top administration jobs will not hesitate to doctor the data if it appears unfavorable to him. If, for example, the inflation rate rises, a furious Trump will probably pressure BLS to tone it done a bit for public consumption. A more pliant Federal Reserve, fearful of losing its independence, may be less inclined to raise (or not lower) interest rates if threatened by Trump. The career civil servants who tote up the numbers, write and issue the economic reports every week or month are probably not going to be around for long if they persist in dealing in and doling out accurate data.
Cooking the federal government’s books is a huge problem. Data suppression or alteration poses serious risks across the board. Millions of businesses rely on accurate data in order to plan ahead, make investment decisions, decide whether to expand their workforces or not, loan money and so forth. Similarly, the health, welfare and economic status of various demographic groups are affected by government data. Should Trump 2.0 make this bleak scenario come to pass, mayhem will surely follow.
Dick Hermann
December 21, 2024
In short, the Discoverer cooked the books.
Five hundred years later, cooking the books became an unfortunate feature of company practice in a series of notorious episodes of corporate financial fraud. Enron became an early 21st century poster child for book cooking in order to appear much better to shareholders than its actual performance would warrant. A few years later, the now defunct Lehman Brothers did something similar that went a long way to triggering the Great Recession. It was not alone among its Wall Street brethren when it came to lying about its finances. Subsequently, the Trump Organization was found guilty of cooking the books, first to shower senior executives with perks in order to evade paying taxes; then again to cover up the true purpose of what came to be labeled “hush money” payments to Trump’s paramours.
Book cooking became a “thing” on Day One of Trump’s first term, when he and his horseholders insisted that his inauguration crowd was the largest ever, an absurdity easily disproven by photographic images. Then, during his tenure, there were attempts to intimidate career civil servants tasked with collecting and reporting economic and other statistics when they were not favorable to the administration. These efforts included multiple, and fortunately unsuccessful, attempts to distort the accuracy and legitimacy of census population counts used to distribute seats in the House of Representatives, draw electoral districts, and allocate more than $1.5 trillion annually in federal funding; 1,400 changes to federal agency websites that eliminated science-based information on climate change and environmental issues (per Silencing Science Tracker); harassment of the Bureau of Labor Statistics (BLS) when its data (e.g., economic growth, unemployment rates, rate of inflation) did not reflect positively on the administration; and threats against the independence of the Federal Reserve when it did not lower interest rates. Because Trump and his MAGA advisors were government greenhorns, the Era of Alternative Facts was just getting started, and there were still some guardrails, as well as guardians of the public trust in high positions, the damage was for the most part, contained.
Containment will be less likely the second time around. The cabinet and other senior appointees Trump has chosen for the top administration jobs will not hesitate to doctor the data if it appears unfavorable to him. If, for example, the inflation rate rises, a furious Trump will probably pressure BLS to tone it done a bit for public consumption. A more pliant Federal Reserve, fearful of losing its independence, may be less inclined to raise (or not lower) interest rates if threatened by Trump. The career civil servants who tote up the numbers, write and issue the economic reports every week or month are probably not going to be around for long if they persist in dealing in and doling out accurate data.
Cooking the federal government’s books is a huge problem. Data suppression or alteration poses serious risks across the board. Millions of businesses rely on accurate data in order to plan ahead, make investment decisions, decide whether to expand their workforces or not, loan money and so forth. Similarly, the health, welfare and economic status of various demographic groups are affected by government data. Should Trump 2.0 make this bleak scenario come to pass, mayhem will surely follow.
Dick Hermann
December 21, 2024
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