No, Obama Did Not Fake The Unemployment Rate

US President Barack Obama makes a statement to the press before a meeting in the Roosevelt Room of the White House November 1
US President Barack Obama makes a statement to the press before a meeting in the Roosevelt Room of the White House November 15, 2013 in Washington, DC. Obama met with health insurance industry leaders to discuss allowing consumers to re-enroll in plans that had been canceled because of the Affordable Care Act. AFP PHOTO/Brendan SMIALOWSKI (Photo credit should read BRENDAN SMIALOWSKI/AFP/Getty Images)

Conservatives are working themselves into a froth about what they believe is the next HUGE OBAMA SCANDAL: allegations that the unemployment numbers were cooked just ahead of the 2012 election.

This scandal may turn out to be just as devastating to the Obama administration as the IRS, Benghazi and Fast & Furious scandals. Not devastating at all, in other words. In fact, this one seems even flimsier than those pseudo-scandals.

New York Post columnist John Crudele, citing one anonymous source, claims that Census Bureau employees have been ordered to make up responses when surveying households for the Labor Department's monthly unemployment report. Crudele claims to have evidence from 2010 that one Census survey-taker was caught making up numbers to meet a quota. Crudele's anonymous source claims there were other incidents of surveyors making up numbers, that Census officials encouraged such shenanigans, and that fake-number generation ramped up ahead of the 2012 election.

This, Crudele suggests in a daring leap of logic, probably explains unemployment's drop to 7.8 percent in September 2012 from 8.1 percent the month before. That drop was reported on Oct. 5, 2012, just a month ahead of Election Day, and immediately seemed suspicious to conservatives like former General Electric CEO Jack Welch, who tweeted:

Conservatives were aflutter again on Tuesday about Crudele's column, with CNBC forehead-vein-farmer Rick Santelli declaring himself and Welch vindicated, and failed GOP presidential candidate Herman Cain tweeting:

But sorry, Herman Cain, no. "The employee who did it" does not say that. In fact, there is no such employee in Crudele's report. Crudele cites only an anonymous source who generally claims that numbers were made up. The "employee" who allegedly "did it" is one guy who allegedly made up numbers in 2010, which careful readers will note was two years before the election. That employee was not accused of raising or lowering unemployment figures -- just of making up numbers to meet a quota of households.

Update: CNBC's Steve Liesman reports that the alleged "employee who did it," Julius Buckmon, has not worked at Census since August 2011. It's highly unlikely Buckmon threw the 2012 election from his couch.

Obviously, if the Census Bureau is telling employees to make up numbers one way or another, that's a problem. Neither the Census Bureau nor the Labor Department had anything interesting to say about Crudele's report when contacted by The Huffington Post, although a Labor Department spokesman said the Commerce Department was investigating the claims. The Census Bureau, which is a part of the Commerce Department, did not confirm or deny that statement.

Still, it's not possible for one employee alone, or even a few, to have altered the unemployment rate by submitting false data -- Census surveys 60,000 households in one week, a massive task involving about 2,200 workers. That makes a rate-moving conspiracy highly unlikely.

"This fraud would have to be so widespread, to affect enough of the survey takers to affect the top-line numbers, that it seems implausible on the face of it," said Heidi Shierholz, an economist who studies unemployment at the Economic Policy Institute, a left-leaning think tank.

The 0.3-percent decline in unemployment in September 2012 was not an unusually large change, Shierholz pointed out -- the unemployment rate tends to be volatile. Unemployment also fell by 0.3 percent in November 2011, less than a year earlier. September's drop, though large, was not out of line with the overall trend in unemployment, which has continued to decline steadily, if slowly, in the year since the election.

And cooked or raw, these monthly jobs numbers aren't precise measures, anyway. The Labor Department says it has 90 percent confidence them. That means a reported 6 percent unemployment rate might really be 5.8 percent, or it might be 6.2 percent. For an 8 percent unemployment rate, the variation would be slightly wider.

In fact, if Obama really is cooking the unemployment numbers, he needs to send them back to the kitchen -- this has been the slowest job-market recovery since World War II. One month's unemployment report did not change that.

Update: The Census Bureau just put out a statement completely denying Crudele's report:

The Census Bureau takes allegations of fraud by its employees very seriously. Fabrication of data by an employee is grounds for disciplinary action, including dismissal and possible criminal action.

We have no reason to believe that there was a systematic manipulation of the data described in media reports. As a statistical agency, the Census Bureau is very conscientious about our responsibility to produce accurate Current Population Survey data for the Bureau of Labor Statistics and all other surveys we conduct. We carefully cross check and verify the work of our staff to ensure the data's validity, including random quality control monitoring. That monitoring process includes reinterviewing respondents, and rechecking the data an employee has submitted, looking for red flags that indicate possible fabrication, such as abnormally short lengths of interviews or higher survey completion rates that are out of sync with normal survey collection productivity levels.

That is why when we learned of the allegations of fabricated Current Population survey results, we immediately reported them to the Office of the Inspector General.



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