Congress and Ostrich Economics

Faced with the need to make policy in a rapidly changing economy, Congress is going absolutely the wrong way by planning to cut funding for the Census Bureau to $888 million next year, down from $1.15 billion.

The cuts are likely to damage the government’s ability to track the economy on a timely basis, including potentially eliminating the Survey of Business Owners, which tracks the very entrepreneurs who create jobs.

To put it another way: If you are steering a car along a dark road at night, you don’t turn off the headlights. Bad data lead to bad policy mistakes.

Indeed, if we want to do a better job of encouraging job creation today, Congress should actually boost spending on data that can help make better policy decisions. PPI has suggested that a small amount of additional money for the Bureau of Labor Statistics could help fund a Competitiveness Audit. Such a program could help identify those domestic industries which are ‘near-competitive’ on global markets, so that a small amount of economic development funds could make a big difference for job creation.

It’s worth noting that the first set of national economic accounts were created during the Great Depression of the 1930s by Simon Kuznets. All sorts of other economic statistics date back to the Great Depression as well, including comprehensive unemployment figures.

The current crisis should be a sign that we need to broaden our understanding of the economy, not narrow it.


  1. I fully agree with your take on the cuts to the Census Bureau. Now going along with your car analogy, what do you think would be the best approach to turning on the “brights” of the economy? Sure, having headlights on is helpful for seeing down a dark road, but having your brights on to see farther ahead is even better.

    Or is it not possible in our current economic situation to see any farther down the road?

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