Obama Propaganda Tools Shuttered By Shutdown

Photo credit: kickerclub.com (Creative Commons)

One of the D.C. governing elite’s favorite propaganda tools is a constant flow of “economic” data from government agencies.

In the past, I’ve pointed out that the government uses phony statistics to fool us all into following their lead on policies. They recognize that controlling information allows them to control the discussion.

The 2008 TARP bailout is a classic example of data-driven hysteria. “Government experts” told us that the modern world would end if we didn’t send 700 billion taxpayer dollars to Wall Street. The Permanent Class in D.C. decided that the corrupt banks were just “too big to fail,” and the greedy bankers that plunged America into the subprime mortgage crisis were able to keep their jobs. The plan was a great success… for Wall Street.

The bankers then funneled some of the windfall back to D.C. in the form of campaign donations to Obama and others who supported the TARP bailout.

Henry “Hank” Paulson, the former CEO of Goldman Sachs – one of the banks saved by TARP – was George Bush’s Secretary of the Treasury at the time. He was especially happy to save his old firm and keep the dollars flowing. Retirement riches were literally “guaranteed” for Paulson after TARP bailed out Goldman for the mistakes Paulson himself had made as CEO.

Not long afterward, Obama replaced George Bush in the White House. Unfortunately, the changing of the guard had little effect on the flow of phony “economic” statistics being used by the Permanent Class.

A Break in the Action

Obama’s propaganda machine has been humming along ever since his election…until the government shutdown. The partial shutdown provided a temporary reprieve.

The September jobs report, which Wall Street analysts eagerly await, wasn’t released.

The Commerce Department’s report on construction spending is MIA.

The Labor Department’s Bureau of Economic Analysis – which prepares the studies of America’s gross domestic product (GDP) and the monthly trade balance – shuttered its website.

If you tried to visit, all you got was a message that said: “Due to the lapse in government funding, www.bea.gov will be unavailable until further notice. This includes access to all data and the e-File system. We sincerely regret this inconvenience.” But in my humble opinion, this report-free period is far from an inconvenience… It’s a blessing in disguise.

John Williams’ excellent website, Shadowstats, has documented the distortions and abuses that government agencies use and explains why they continue to release faulty data. For example, the mainstream media is reporting an “Obama recovery.” But there’s been no recovery since 2008. The unemployment figures have been distorted by not reporting the long-term, hardcore unemployed that have, in desperation, given up on finding gainful employment.

The inflation numbers have under-reported rising prices. The Labor Department manipulates the Consumer Price Index (CPI). And when the CPI is rigged, it distorts the GDP figures. This results in phantom GDP gains that are actually just increases in prices. “Real GDP” can actually decrease while “nominal GDP” increases as a result of price increases.

Imagine Chrysler produces a Town and Country minivan. Nominal GDP goes up if they increase the price of the minivan by $1,000. But the real GDP doesn’t increase at all – you still only have one minivan produced. Now, if the government miscalculates the CPI and says the price of the minivan only went up $750, the government would show real GDP growth of $250, even though it didn’t actually go up at all. You still only have one minivan.

This type of statistical manipulation goes on all the time. But it may soon be coming to an end. This week, a new Google-backed startup called Premise announced that it’ll begin offering real price index numbers based on real data.

Rather than relying on the government to tell us about pricing, Premise uses crowd sourcing in the field. Thousands of smartphone users are snapping pictures of actual products and their prices, providing total transparency in the reporting. Using the smartphone GPS locator data, we’ll soon know the prices of all kinds of products city by city.

The initial data released by Premise shows prices shooting up faster than the CPI anticipated. This is a good reminder of why we should be wary of government-produced stats, as they’re often just propaganda.


This commentary originally appeared at CapitolHillDaily.com and is reprinted here with permission. 


Photo credit: kickerclub.com (Creative Commons)

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  1. MuslimLuvChrist says:

    Great article picture, where is this trash can that has Obigbrother as a backboard, Texas? I have a great idea for a product. If anyone comes up with an Obtraitor dart board, I will buy one!
    The Senate budget (we had to wait 5 years for this) includes significant HIDDEN cuts in Social Security benefits. The cuts include a sly reform called a “chained CPI.” This would change the numbers used to calculate the annual cost-of-living adjustment. The government currently uses the Consumer Price Index (CPI) to measure inflation. According to the Department of Labor, the CPI measures how much the cost of a “market basket of consumer goods” changes over time. The new chained CPI adjusts the traditional CPI for potential changes in goods purchased as a result of price increases. For example, if the cost of fish increases, you’ll likely choose to eat chicken instead. When chicken prices go up, these all-knowing federal employees speculate that you might (again) choose a less expensive alternative. As a result, they’re constantly changing the basket of goods to minimize the appearance and effects of inflation on government finances. Yet this same deceitful move proliferates the impact of price increases on grandma’s social security check.

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