Cutting Spending on Statistics Won’t Save the Budget

From PacificStandard:

Last week, the Trump administration announced it would seek dramatic spending cuts across a number of agencies in order to pay for a $54 billion increase in defense spending. That will be tough to accomplish: The bulk of the federal government’s budget goes to Social Security, Medicare, and defense spending, all of which the president has vowed to leave untouched. The administration has specifically said it would target the Environmental Protection Agency and “foreign aid,” both of which constitute a very small proportion of the federal budget. But elsewhere in Washington, D.C., researchers are worried that another category of government spending is also vulnerable: spending on statistics and data.

Donald Trump’s hostility toward official economic data is especially well-known. His casual comments about the official unemployment rate being “phony” have pained economists for months, and researchers have worried that the administration might seek to either stop collecting necessary data altogether, or might direct agencies to skew data in a manner that supports certain policies or claims. Last month, the Wall Street Journal reported that the administration was already floating the idea of changing the way the government calculates trade deficits, with a revised methodology that would make trade gaps look bigger—a change that would presumably bolster support for Trump’s assertion that the country’s trade policies and agreements need to be renegotiated or changed.

Deficit Projections Are Often Way Off the Mark

The fairly modest federal deficit projected for the next few years has made fiscal discipline a less urgent policy concern than it was only a couple of years ago. But can we believe the projections? Does the fact that the deficit is projected to remain fairly small mean that the deficit is likely to remain fairly small in reality?

History indicates there is often a wide gulf between the deficit projections offered by the U.S. Office of Management and Budget, and what actually ends up happening. And that can have major implications when it comes to policy.

The deficit has shrunk considerably, and is expected to remain tame, according to recent federal budget deficit data, and projections released with the 2016 budget (see chart 1). In fiscal year 2014 the federal budget deficit was 2.8 percent of GDP. And it is projected to stay around 2.5 percent of GDP through 2020. This is close to the average deficit of 2.6 percent of GDP since 1960, and much lower than the deficit was only a few years ago, when it exceeded 8 percent of GDP.

More from the American Institute for Economic Research

Census Bureau planning to discontinue the production of all 3-year ACS data

The Census Bureau is planning to discontinue the production of all 3-year American Community Survey data, according to their budget justification document:

"The Census Bureau proposes to terminate permanently the “3-Year Data” Product. The Census Bureau intended to produce this data product for a few years when the ACS was a new survey. Now that the ACS has collected data for nearly a decade, this product can be discontinued without serious impacts on the availability of the estimates for these communities."

See page 110 of 190, or page CEN-106 of US Census Budget estimates for FY 2016.

The elimination of the 3-yr ACS data products must be approved by OMB before it becomes official.

How the Feds Blind Us To Our Malaise

Though we seldom think of them this way, America's statistical agencies are the very eyes and ears of our democracy. When they are functioning properly, they provide essential information to help the public and its elected representatives see what is going right in our country-and what is going wrong. Such information is crucial for forming a more perfect union.

Without timely and accurate information on our domestic problems, our government cannot hope to address these swiftly, much less effectively. Whether you are a progressive or a conservative, in favor of more government or less of it, you need good data to inform your own efforts to make our country better.

America was the first government in the modern era to recognize the importance of evidence-based public policy. Our Constitution mandated a decennial census-a truly revolutionary notion back in the late eighteenth century. And for most of our history, the U.S. statistical system has been well ahead of the curve, if not a virtual wonder of the world.

No longer. Today our government statistical services are failing at some vital missions-and they have generally been falling away from the global forefront for at least a generation. In key fields we see not only stagnation, but even retrogression. The painful truth is that our statistical services are currently incapable of providing some of the basic facts and figures we need for confronting our most pressing domestic social troubles.

More from HERE.

Sequestration-Related Budget Cuts; Regional, State, and Local Impacts

C2ER has compiled a brief summary of sequestration-related budget cuts by government agency. These items were chosen specifically for their potential impact on regional/state, and local programs.

Bureau of Economic Analysis (BEA)

Regional Input-Output Modeling System (RIMS) - BEA eliminated the RIMS II product in FY 2013. RIMS II provides modeling estimates to the private sector, Federal, state, and local governments on changes in economic activity.

Local Area Personal Income Statistics (LAPI) - BEA also eliminated detailed statistics within its LAPI program. This is the only source for county and metropolitan area personal income statistics.

Foreign Direct Investment Analytical Products - BEA eliminated analytical activities related to FDI and the operations of multinational companies (MNCs), affecting some annual publications as well as occasional topical papers. BEA also stopped publishing analytical products that provide insight into offshoring, the impact of MNCs on the domestic economy, and the impact of global value chains for measuring economic activity.

Find more information here.

Bureau of Labor Statistics (BLS)

Measuring Green Jobs - The BLS eliminated the Measuring Green Jobs products. This includes the special employer surveys that provide data on the occupations and wages of jobs related to green technologies and practices, as well as career information related to green jobs.

Mass Layoff Statistics Program - Also eliminates is the mass layoff program that provides information identifying, describing, and tracking the effects of major job cutbacks in the economy.

International Labor Comparisons Program - The International Labor Comparisons (ILC) program has also been eliminated. This program adjusts foreign data to a common framework of concepts, definitions, and classifications to facilitate data comparisons between the United States and other countries.

Find more information here.

Census Bureau

Economic Programs - A six-month delay in the delivery of over 1,600 Economic Census products due to staffing reductions at the National Processing Center and Census headquarters.

2020 Decennial Census Programs - Budget cuts mean that Census cannot carry out the planned research and testing needed for work on design options for the 2020 Census. Reduced funding levels also force the delay of preparatory work related to the FY 2014 field tests, delaying the acquisition of information needed to make design decisions in FY 2015 for the 2020 Census.

Geographic Support Program - Reductions will delay decisions about the viability of cost-saving designs associated with the 2020 Census address canvassing operation, scheduled for later in the decade.

American Community Survey - Cuts to the American Community Survey (ACS) eliminate much needed investments in the ACS processing infrastructure, program management, and research program.

Demographic Programs - Cuts to these programs prevent the implementation of new supplemental poverty measures. These cuts will also delay data releases for the 2014 panel for the Survey of Income and Program Participation.

Find more information here.

Energy Information Administration (EIA)

Annual Energy Review - The EIA has suspended publication of the Annual Energy Review and its companion publication, Energy Perspectives.

Residential Energy Consumption Survey (RECS) - Delayed to FY 2014. It has also delayed upgrades to its critical weekly petroleum and natural gas statistical reports.

EIA's FY 2013 and FY 2014 Budget Requests to Congress can be viewed here.

United States Department of Agriculture

National Agricultural Statistics Service (NASS) - The National Agricultural Statistics Service is suspending a number of statistical surveys and reports.

Find more information here.

USDA Economic Research Service (ERS)

Agricultural Productivity in the U.S. - Updates of the State-level statistics are suspended.

County-Level Data Sets (“County Look-Up Tables”) - Updates of socioeconomic indicators in this format will be phased out.

Find more information here.

Big Cuts In State and Local Government Jobs

Combined state and local government employment across the U.S. has declined significantly since the Great Recession began in December 2007, according to a new report from the Rockefeller Institute of Government.

During the past year, state and local governments cut a total of about 489,000 jobs, a decline of 2.5 percent. Percentage cuts in state and local government employment are actually greater, if we compare current employment levels to peak levels. As of December 2012, for the nation as a whole, state and local government employment is down 3.4 percent or 681,000 jobs from the peak level recorded in August of 2008.

The report shows that the impact of the Great Recession on state and local public employment has been much deeper than any other recession in the last 50 years.

How New York State Doles Out Its Education Dollar

From the Citizens Budget Commission

In school year 2012-13, school districts in New York are expecting to receive $20.4 billion in aid from New York State, an amount that comprises just over 40 percent of their total budgets on average. However, aid per student varies among districts. Some of the variation stems from the needs of the students within district boundaries and from resident taxpayers’ capacity to raise revenue locally. Still, historical patterns established decades ago, kept in place by “hold harmless” provisions built into aid formulas, also drive the distribution.
The CBC's new interactive map documents school aid variation by district. Click on or search for a school district to see state aid per student by major category, as well as measures of district need and ability to pay.

Government Counting Sheep? Now, Only in Its Dreams

By WILLIAM NEUMAN
Last year, Wisconsin led the nation in mink farming, producing 833,430 pelts. Texas was the undisputed king of pansies, growing 1.8 million flats of the flowers. And no state harvested more hops than Washington, with 24,336 acres.
This year? Who knows? The government has stopped counting.
Forced to cut its budget, the Agriculture Department has decided to eliminate dozens of reports, including the annual goat census (current population: three million), and the number of catfish on the nation’s fish farms (177 million, not counting the small fry).
Which raises an existential question: If the government stops counting catfish, do catfish farmers no longer count?
...
The decision, announced last month, to stop measuring various categories of agricultural products reflects a cold-blooded assessment of the economic usefulness of the 500 or so reports that the National Agriculture Statistics Service does every year. Corn, soybeans, cotton and other major commodities vital to the national economy will still be weighed, inventoried and otherwise tallied down to the last acre, bushel or bale. The same is true for cattle, pigs and poultry.
But the Agriculture Department is saying, in effect, that the nation can get by just fine, thank you, without knowing how much hops brewers are holding in storage (46 million pounds in September) or the value of honey sold by North Dakota beekeepers ($70 million in 2010).
Farmers say such data is crucial — and not just because it helps them decide how much to plant or how many animals to raise. Potato farmers use reports on potato stocks to decide when to sell. Hops farmers use the data to persuade bankers to lend them money for costly processing facilities. Restaurant chains watch catfish numbers to anticipate price changes. With the Texas drought forcing farmers to send their sheep herds to other states, wool and lamb buyers would normally use federal data to see where the animals went.
The government began producing regular crop reports in 1863, the year after Lincoln created the Agriculture Department. One of the reports being eliminated, an annual sheep inventory (5.5 million head on Jan. 1), can trace its roots at least as far back as 1866. Also ending are reports on bees, honey production, flowers and nursery crops.
The statistics service said it was forced to reduce the frequency of some reports and eliminate others because its budget was cut for the fiscal year that ended in September and it expects further cuts for the current year. The eliminated reports will save $11 million a year.
...
More HERE.

CENSUS BUREAU APPROPRIATIONS UPDATE: Action alert!

From Terri Ann Lowenthal of the Census Project:

Next week, both the House and Senate will be back in session.

The Senate is expected to finish action on its first 'minibus' appropriations bill (H.R. 2112) for Fiscal Year 2012 (FY12), covering three appropriations accounts: Commerce, Justice & Science (which includes the Census Bureau); Transportation/HUD; and Agriculture. While we have not yet seen amendments that would affect the Census Bureau's funding, anything is possible -- there was a rumor last week about an amendment to reduce the Bureau's Working Capital Fund, a lesser known but robust revolving line item that funds critical core activities of the agency -- and we will keep a close eye on continued Senate debate.

Meanwhile, House Appropriations Chairman Harold Rogers (R-KY) announced that conferees would begin work next week on the minibus bill, even though the House itself has not considered any of the bills incorporated in the larger one. Therefore, conferees will be working with parameters set by the House Appropriations Committee and, presumably, the full Senate.

As a reminder, key activities in the Periodic Censuses and Programs (Periodics) account are the 2010 Census (final evaluations; data products; challenge program; Census Coverage Measurement, or undercount/overcount estimates); research and planning for 2020 Census; and the 2012 Economic Census and 2012 Census of Governments. The Salaries and Expenses (S&E) account covers ongoing economic and demographic surveys and research supporting ongoing programs.

Here's the current lay of the land:

1. The Census Bureau requested $752.7M for Periodics, a reduction of $138.5M from the FY11 funding level. House appropriators allocated only $596.2M for Periodics (H.R. 2596), a reduction of 21% below the request (and 25% below the FY11 funding level). With this funding level, the Census Bureau says it would cancel the 2012 Economic Census, scheduled to start this fiscal year, with data collection occurring at the start of 2013. The Bureau also would delay or cancel some 2010 Census evaluations (possibly including the Count Question Resolution Program, through which local governments can challenge their census counts) and unique 2010 Census data products. The House budget cuts also would delay estimates of undercount/overcount from the Census Coverage Measurement program.

2. Senate appropriators allocated $690M for Periodics (S. 1572). Report language directed the Census Bureau to conduct the Economic Census and to reduce spending on periodic programs (indicating less than a thorough understanding of this account, since the Econ Census IS a periodic program!). According to the Commerce Department's impact statement, the Census Bureau needs "no less than" $690 million for the Periodic Censuses and Programs account to start the 2012 Economic Census. However, the agency would eliminate some key elements of the Economic Census, including the Survey of Business Owners. It also would cut Group Quarters (prisons; college dorms; military barracks; nursing homes; juvenile detention centers; etc.) from the American Community Survey. The proposed Senate funding level also would affect final 2010 Census activities, as noted above in the consequences of the House-committee approved level. The Census Bureau indicated that the Senate funding level would "adversely impact" nearly 300 jobs.

3. The Census Bureau requested $272.1M for the S&E account, incorporating $14M in program decreases to help rein in spending, including popular activities such as the Statistical Abstract. The House committee allocated $258.5M, equal to the FY11 funding level. The Senate committee allocated $253.3M. Under either funding level, the Census Bureau would carry out its own proposed cutbacks and would not proceed with three other initiatives: statistics on state and local government pensions, which inform GDP calculations; updates to the nation's poverty measure (through the CPS Supplemental Survey); and research on the use of administrative records to replace or supplement field data collection.

4. Continuing Resolution for FY12: The current CR runs through November 18. Congress could extend the temporary funding measure until Thanksgiving, or until the week before Christmas. Too early to know!

For more detail on the consequences of reducing or eliminating these core Census Bureau programs, including the quinquennial Economic Census, please see the letters to the House and Senate signed by dozens of organizations participating in http://www.thecensusproject.org/ The Census Project

SUGGESTED ACTION: Census Bureau stakeholders should contact members of the House and Senate Appropriations Subcommittees on Commerce, Justice, and Science, as well as the Appropriations Committee chairs and ranking members -- all presumed conferees -- to highlight the serious consequences of the proposed funding levels for the Bureau.
House subcommittee members
Senate subcommittee members

Please keep in mind that important research for the 2020 Census also is at stake. Congress is directing the Census Bureau to reduce spending on the decennial census significantly over the decade. The Census Bureau already has taken that directive to heart, but it cannot hope to implement new cost-saving methods and operations without a modest investment up front (e.g. early in the decade) on thorough research and testing.

Slashing the Census Budget

Census cuts could end some surveys

The Census Bureau would have to make severe cuts in the type of data it collects from American households and businesses if its budget is slashed 25 percent, as proposed under a bill being considered by the House Appropriations Committee, according to experts on the census.

The agency, which is closing half its regional offices to save money, has warned that cuts that big would likely mean an end to next year’s Economic Survey, which is conducted every five years and is used to calculate the nation’s Gross Domestic Product, among other things. There also could be deep cuts in the American Community Survey, a monthly survey of households that provides detailed information on a wide variety of habits, from commuting patterns to household income levels.

While the Obama administration has proposed reducing the agency’s budget from $1.15 billion to $1.02 billion, House lawmakers are considering a bill that would give the Census Bureau $885 million in 2012 — almost $300 million less. That is much deeper than the 6 percent cut being proposed for the Commerce Department, which oversees the bureau.

Census Budget: House Bill Would Gut Economic Monitoring, Endanger GDP And Other Stats

"It would have major, permanent impacts on the nation's economic and demographic statistics," the bureau said, according to Rep. Carolyn Maloney (D-N.Y.), a member and past chair of the House Joint Economic Committee.

Maurine Haver, the head of the National Association of Business Economists' statistics committee...did note that collecting less information is good only for people who are not interested in answers.

"I just have no clue what they are thinking," Haver said. "If you want to run the country not based on information but just based on your ideology, this is fine -- if you don't need to know what's going on out there."

Also, The Consequences of Budget Cuts.

States with Projected Budget Shortfalls, SFY2013

From www.statehealthfacts.org.

No more Statistical Abstract?

A librarian posted this on the BUSLIB (Business Librarian) listserv this afternoon:

I couldn't take the uncertainty anymore so I called the Census Bureau and spoke to Ian O'Brien who's the Chief of the Statistical Compendia Branch. He said that the 2012 budget doesn't include funding for his branch, which would mean the elimination of not only the Statistical Abstract, but all titles produced by that branch (State and Metropolitan Area Data Book, County and City Data Book, etc.). No new editions would be produced in print or online.

I asked if there was any hope of changing this and he said that there's always a chance that Congress could be convinced to continue funding for the program. He said those who would like to save the Statistical Compendia Branch could write to their Senators and Representatives. I'm guessing this would go for the Federal Financial
Statistics Program as well.

So, start writing your letters and encourage others to do the same.

Federal Statistics in the 2011 Budget

Source: Council of Professional Associations on Federal Statistics

Statistics produced by the federal government serve as a base for research in a broad spectrum of scientific disciplines. Population and vital statistics are central to the work of political scientists and demographers; employment, financial, and production data are essential for economists; and information on education and crime is used by sociologists and psychologists. Responsibility for the collection, analysis, and dissemination of federal statistics is spread throughout the departments and independent agencies of the executive branch; each of some 70 agencies and departmental units annually spends $500,000 or more on statistical activities. Within this decentralized system that generates statistical information, a more limited number of agencies have the creation of statistics as their principal mission. It is these agencies that are responsible for producing statistics on major economic, demographic, and social developments and trends...

New papers, presentations from Rockefeller Institute

Trends in state and local government finance, social welfare spending and gambling revenues to states are among the topics Rockefeller Institute researchers have explored in recent conference papers and presentations. The following papers and presentations are now available from the Rockefeller Institute Web site:
• The Decline of States in Financing the U.S. Safety Net: Retrenchment in State and Local Social Welfare Spending, by Thomas Gais, Lucy Dadayan and Suho Bae, presented at the “Reducing Poverty: Assessing Recent State Policy Innovations and Strategies” conference at Emory University, Nov. 19-20.
• State Budgets, Health Care, and Health Care Reform, presented by Donald J. Boyd to the National Academy of Public Administration, Nov. 19.
• Discussant comments on “Fiscal Sustainability Issues & Options,” presented by Donald J. Boyd at the National Tax Association Annual Meeting, Nov. 14.
• Trends in Gambling Revenue to the States, presented by Lucy Dadayan to Stop Predatory Gambling, Nov. 9.
• State Budget Gaps: Consequences for Policy, Now and in the Future, presented by Robert B. Ward to the Association for Public Policy Analysis and Management Annual Research Conference, Nov. 5.

CENSUS NEWS BRIEF: FY2010 Budget Request

Go to Census News Brief for May 5 with information on several recent 2010 census developments.

On May 7, the President is expected to release his detailed budget request for Fiscal Year 2010, which begins October 1, 2009 and includes funding for final census preparations such as staffing all Local Census Offices (LCOs), launch of the 2010 census advertising campaign, and implementation of the census through mailed and hand-delivered questionnaires and follow-up visits to unresponsive households.

Budget of the United States Government

For Fiscal Year 2010.

Amendment to cut libraries out of broadband package in Senate stimulus bill

Calls to ALL Senators are needed IMMEDIATELY to protect $200 million for libraries, community computing centers and related institutions in the original language of the Senate stimulus bill, H.R. 1, the American Recovery and Reinvestment Act of 2009. The American Library Association has just been advised that Senators Kent Conrad (D-ND) and Lindsey Graham (R-SC) are expected to introduce Senate Amendment 501 which would strip funding for libraries and broadband to put additional funding in FDIC. If introduced, the vote could take place this afternoon.

The message is: keep the $200 million for libraries and broadband in H.R. 1 - defeat amendment 501. Libraries provide information on jobs, employment skills, and all other types of job-seeking information. More people are using libraries during these difficult times and the demand for broadband is greater than ever.

National Survey Reveals Escalating Budget Crisis for States

States, which already have closed $40 billion in fiscal year (FY) 2009 budget gaps, face at least an additional $97 billion they must close over the next 18 to 24 months, according to a national report issued this week by the National Conference of State Legislatures.

NCSL said the news will pose difficult decisions for state legislators across the nation as they prepare for the 2009 legislative sessions.

State Budget Update: November 2008, a survey of the nation’s state legislative fiscal officers, reports that states face a $32 billion budget gap after already closing a $40 billion gap since the current fiscal year began. Their projections for the next fiscal year, which begins July 1 for most states, reveal another $65 billion gap.

Fifteen states are forecasting double-digit gaps in FY 2010. The largest are in Arizona (24.2 percent), New York (20 percent), California (18 percent), Wisconsin (17.2 percent), Minnesota (14.7) and Kansas (14.5 percent).

NCSL's State Budget Report Update: November 2008 is a 60-page report that provides information for all 50 states and Puerto Rico. It gives an overview of state fiscal conditions, including state revenue performances, estimated budget gaps in FY 2009 and FY 2010 and actions legislatures are expected to take to close their budget gaps. This report is free only to credentialed members of the media and is available for purchase.

State Budget Damage 'Just Beginning'

“The damage is just beginning” in state budgets, the Rockefeller Institute’s latest State Revenue Report concludes. While overall tax revenues were “superficially strong” in the second quarter of 2008, sales-tax collections are down and declines in income-tax revenue are highly likely in the months ahead. More widespread budget cuts by states “are virtually certain,” the Institute reported. Read the news release.

Continuing resolution boosts funding for Census Bureau

From the 9/24/2008 Federal Times

The Census Bureau would get extra funds to conduct the 2010 census under the continuing resolution passed by the House today.
While the bill holds most agencies’ funding to current levels, the Census Bureau would receive $2.9 billion in 2009, up from $1.3 billion in 2008.
The vote comes one day after the head of the bureau told lawmakers that its efforts to launch the 2010 census would be set back significantly if Congress opted to simply extend current budget levels into 2009 under a continuing resolution.

This shows the danger of continuing resolutions. Census needs more money heading towards the decennial census than it does in some other years, and Congress actually responded to that fact.