Should we believe the government when it says the budget has been cut or the economy is still expanding?
Private-sector economists, business people and others are increasingly skeptical of government jargon and statistics.Most recently, their eyebrows were raised by the government's figures for the third-quarter gross national product, which showed growth running at an annual rate of 1.8 percent, confounding a vast number of researchers who were convinced the report should have shown the economy shrinking.
Walter J. Williams of American Business Econometrics, a Ridgewood, N.J., advisory firm that counts blue-chip corporations as clients, declared flatly that the supposed expansion will be revealed eventually as a contraction.
Williams estimates that in reality the decline amounted to about 2 percent on an annual basis, and he expressed the personal opinion that the numbers were manipulated to influence the November elections.
Economist E. Erich Heinemann was equally blunt, declaring the report of accelerated economic growth "spurious" and "phony as a three-dollar bill." Referring to underlying assumptions, he said, "the illogic is dazzling."
Such comments are becoming widespread, and involve not just the accuracy of numbers but the intent of words as well. Economists and business people, for example, are upset that Americans believe Congress actually cut the budget.
Among those angered by that interpretation are members of the U.S. Business and Industrial Council, made up of the heads of mainly small- and medium-size businesses, many of whom have had to cut their own budgets.
The council, a conservative group based in Washington, issued a statement saying "our member companies are increasingly frustrated by the jargon of deficit reduction."
The statement explained they "cannot fathom the `current services' approach to budgeting, which allows for automatic increases in spending." The "reduction," it says, allows for $240 billion in new spending.
It is the statistical communications, however, that seem to receive the most criticism, and Williams asserts that some of the distrust arises from the suspicions that economic numbers are managed.