WANT THE PRESIDENT TO CERTIFY THE GOVT'S BOOKS
By JOHN CRUDELE
nypost.com
July 23, 2002 --
PRESIDENT Bush, the chief executive officer of the U.S. of A., had his chance last Friday to lead by example on the issue of business ethics and honest accounting.
And he didn't.
Washington announced on Friday that consumer prices rose just 0.1 percent in June.
That's supposed to make us all feel better, except for the fact that my kids' tuition is way up, medical expenses are still soaring, and each swipe of my credit card in the real world tells me the government is wrong.
Since the president has spent so much time recently trying to convince business to be ethical, I thought this would be a good time to return to a theme that I've been banging away at for years.
Now, I didn't really expect the president to do anything about fraudulent government numbers, but I'm just trying to make a point about practicing and preaching.
The truth is that the government reports hokey economic statistics just about every week. And these numbers are often so off that this president and those before him would be sharing a cell with Ken Lay if they weren't the ones making the rules.
President Bush, though, wants the CEOs of the nation's largest corporations to vouch - in writing - by Aug. 14 that their companies' accounting is honest. The hitch is that the president wouldn't be able to swear to the veracity of the government's books.
So, how is the government cheating?
Let's go over some of the nonsense this column has uncovered.
The government keeps inflation down by not fairly representing price increases on items like property taxes and health insurance, and greatly understates the rising cost of housing.
But Washington also employs some statistical tricks like Hedonics, Exponential Weighting and Intervention Analysis, esoteric ways to count things that don't always exist.
Why would the government go to so much trouble over the CPI?
First, because keeping the consumer price index low means Washington will have to pay a smaller increase next year to Social Security recipients. Cheating retirees will help the government keep the Social Security system solvent for a few extra years.
For each notch that inflation rises there's an equivalent decline in economic growth.
So if you're a politician who wants to have figures to back up your economic optimism, then fooling with the CPI is the way to go.
The latest trick from the Labor Department has been even more brazen.
Almost without exception this year, Labor has reported monthly job growth that quietly gets reduced sharply or reversed to job losses when the figures are revised the following month.
So, there you have it. Washington is just as bad as corporate America.
Sign the government's books, Mr. President. I dare you. |
