The Bureau of Labor Statistics didn’t include this in its press release, but the headline news from Tuesday’s consumer price index announcement is that William J. Wiatrowski probably won’t get fired.
Wiatrowski is deputy commissioner at BLS, a civil service position that he’s held since 2015. Since August 1, Wiatrowski has also been acting BLS commissioner, because on that day President Donald Trump fired Erika McEntarfer, Wiatrowski’s Senate-confirmed predecessor, for releasing unfavorable jobs numbers.
McEntarfer had absolutely no hand in the jobs numbers’ preparation, just as Wiatrowski had no hand in calculating Tuesday’s CPI. But the July jobs numbers displeased Trump, so he fired her, sending an alarming signal that economic statistics recording unwelcome news will no longer be tolerated. (Richard Nixon once did something similar, but he acted privately and blamed bad jobs numbers on a Jewish cabal.)
“I believe the numbers were phony,” explained Trump, who also believes that he won the 2020 presidential election, that the Emmys were rigged against him when he was star of The Apprentice, that climate change is a hoax, that Finland rakes its forests to prevent wildfires, and (my personal favorite) that magnets don’t work when you pour water on them.
Wiatrowski kept his job because Tuesday’s CPI release put July inflation at 2.7 percent over the previous year, same as in June but a whisker slower on a monthly basis. That was a good enough finding to prompt a rise in the stock market, which is the only metric Trump cares about. Wiatrowski’s job was also made more secure Monday when Trump nominated McEntarfer’s successor. Since Trump always wants to fire somebody, he had to redirect his aggression toward Goldman Sachs, telling it to dismiss chief economist Jan Hatzius for predicting various bad economic outcomes to Trump’s notably reckless and illegal tariffs. University of Michigan economist Justin Wolfers replied on Bluesky: “I’m afraid you’ll have to fire all of us, Mr. President.”
Don’t tell Trump, but the underlying data of the CPI report is less reassuring than the top-line figure. When you strip out groceries and gas, the prices of which are highly volatile, “core” inflation rose to 3.1 percent over the previous year, up from 2.9 percent in June. That’s the highest core CPI number since February. But this rise was only partly due to Trump’s tariffs. Mostly it was driven by price increases for services like plane tickets, health care, and auto repair. Tariffs apply only to goods; in services, the United States has a $26 billion trade surplus, which explains why Trump never thinks about them. Still, inflation is inflation, no matter the cause.
Trump’s nominee to run BLS is a hack named E.J. Antoni. Antoni is chief economist at the Heritage Foundation, and even Stan Vueger, a senior fellow at the conservative American Enterprise Institute, says he’s “utterly unqualified and as partisan as it gets.” Trump tweeted Monday that Antoni’s jobs numbers will be “HONEST and ACCURATE,” but Antoni’s apparent strategy is to make jobs numbers less FREQUENT. Earlier this month, Antoni recommended that the monthly jobs report be eliminated and replaced by quarterly reports. That might make sense if the Federal Reserve adjusted the cost of borrowing on a quarterly basis, but it doesn’t (and it can’t if monetary policy is to be made in timely fashion). The Fed sets interest rates eight times per year, and it couldn’t fulfill its statutory “dual mandate” of addressing both inflation and unemployment if it failed to receive information about unemployment at least eight times a year. Perhaps realizing this, or more likely just noticing the statement was generating bad press, Antoni’s Heritage colleague Stephen Moore said late Tuesday that Antoni has now dropped the idea.
I continue to believe that Trump will fire Fed Chair Jerome Powell before his term ends next May, but he won’t likely fire him soon. That’s because the new inflation report is low enough to justify the drop in interest rates for which Trump has been screaming. The jobs report that cost McEntarfer her job, which showed a puny 73,000 jobs created in July, doesn’t merely justify a Fed reduction in interest rates; it demands it. So the Fed will likely lower interest rates when it meets in mid-September. McEntarfer died that Powell might live a little while longer.
The Who Gets Fired Index is fast becoming the most illuminating measure of the economy (not to mention the rapidly deteriorating quality of government). If Antoni gets confirmed (probably more like “when”), we may need to add a Sycophancy Index. At the moment, Kevin Hassett, director of the National Economic Council, scores highest, with Commerce Secretary Howard Lutnick running a close second. Not coincidentally, Hassett until recently also held the lead in the race to succeed Powell. But Hassett’s prospects to become Fed chair appear now to be dimming.
The sycophancy competition is plainly a marathon, not a sprint, and this new guy Antoni shows real promise. As the truth-tellers fall and the Sycophancy Index spikes, the economy will enter a tailspin. It’s all wildly entertaining, but I’m afraid, dear reader, this is going to cost you money.