Tags: Fed | Bank | Job-Data | Welch

Two Fed Bank Chiefs Dismiss Claim of Job-Data Tampering

Thursday, 11 Oct 2012 05:42 PM

 

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Presidents of two Federal Reserve district banks dismissed a suggestion that the Bureau of Labor Statistics manipulated the September employment report to aid the re-election campaign by President Barack Obama.

“I can’t imagine that’s the case,” Charles Plosser, president of the Federal Reserve Bank of Philadelphia, told reporters after a speech Thursday in Avondale, Pennsylvania. “I don’t think there is a conspiracy,” St. Louis Fed President James Bullard said to reporters in St. Louis.

The two regional Fed bank chiefs commented on suggestions by Jack Welch, the former chief executive officer of General Electric Co., that an Oct. 5 report from the bureau showing an unexpected decline in the jobless rate had been altered.

The report showed the jobless rate fell in September to 7.8 percent, the lowest level since President Barack Obama took office in January 2009, from 8.1 percent in August. The rate was forecast to rise to 8.2 percent, according to the median estimate of economists surveyed by Bloomberg.

“The statisticians and the people that work on this stuff have a lot of integrity,” Plosser said.

Bullard said that while unemployment and other economic reports can have “measurement error,” it’s wrong to suspect anything improper.

“There are lots of people involved,” he said. “They have done it the same way for years and years.”

Welch, 76, in a Twitter message immediately after the report, suggested the numbers were phony. “Unbelievable jobs numbers ... these Chicago guys will do anything ... can’t debate so change numbers,” he wrote. Obama administration officials denounced Welch’s claims as baseless.

Welch revisited his criticism later in a column in the Wall Street Journal.

“The coming election is too important to be decided on a number,” Welch wrote. “Especially when that number seems so wrong.”

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