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New York
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Fire the economists. Sue the Fed chair. Meddle in private businesses. Consider suspending economic reports. Demand fealty. Take over police in the capital. Tell everyone it’s for their own good.
This is what the end of American free-market capitalism could look like. Over the past several days, President Donald Trump has taken steps — unprecedented in American history, but well established in China, Russia and other centrally managed economies — to break the institutions that define and sustain our economic reality.
It’s about to get very messy. Or rather, messier.
Here’s a sampling of just the past two days:
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Trump, having fired the head of the Bureau of Labor Statistics earlier this month because he didn’t like the weak summer jobs report, picked EJ Antoni — a MAGA loyalist with little experience in data collection or labor economics — to take over the agency tasked primarily with data collection and labor economics. (Several economists, both right-leaning and left-leaning, spoke out against Antoni’s nomination, citing his clear political bent and lack of experience.)
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Antoni, an architect of the far-right Project 2025 memo, floated the idea of suspending the closely watched monthly jobs report, before backtracking on that idea amid a backlash Tuesday.
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Trump threatened to sue the Fed chair, Jerome Powell, whom the president has repeatedly threatened to fire, undermining the central banker’s authority at a tenuous time for the American economy.
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He secured a legally dubious arrangement for the government to take a cut of Nvidia and AMD’s chip sales to China.
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He did a 180 on the CEO of Intel. Days after calling for Lip-Bu Tan to step down “immediately” over unnamed conflicts (which caused Intel shares to drop 3%), the president changed his mind after his Oval Office meeting with Tan. (We still don’t know what that was all about.)
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Trump said Goldman Sachs should fire its top economist, apparently because the bank published a note saying Trump’s tariffs were poised to raise prices on consumers (a fact most economists agree on).
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The president deployed the national guard in Washington, DC, claiming that violent crime — down significantly over the past two years, according to police data — was out of control.
That’s a lot to process, which is, of course, the point of the White House’s flood-the-zone media strategy.
So let’s zoom in briefly on the thing that seems the most boring but is actually critical: Trump’s campaign to sow doubt around the economic data produced by the BLS.
Doubting the data
As we reported here last week, it would be difficult, if not impossible, for a Trump lackey in any position to fudge the jobs numbers and present a rosier economic picture — there’d be a mutiny among the civil servants who take pride in collecting and analyzing that data. There’s a century’s worth of procedural integrity there that can’t be easily tossed aside.
It’s much easier, then, to publicly bash the institution itself and tap an economist who’s been critical of the very organization he’s been asked to oversee.
While he retracted his comment, Antoni told Fox Business in an interview before his nomination that he believes it may be time to suspend the monthly report “until it is corrected.”
It’s difficult to overstate how nervous that kind of talk makes business leaders and economists. While few would say the BLS process is perfect, it is undeniably the best way anyone knows how to keep tabs on the sprawling, $30 trillion US economy.
“Suppressing this data is like gouging out our eyes,” said Aaron Sojourner, a labor economist and senior researcher at the WE Upjohn Institute for Employment Research. “It hurts our ability to understand what’s happening around us and forces us into make worse decisions.”
This is hardly some academic or theoretical concern.
Just ask Argentina, whose government in 2007 fired the statistician in charge of its inflation report after she (correctly) projected a big increase in consumer prices. After that, elected officials spent years trying to trick the public, saying inflation was lower than it was. Investors lost trust and pulled their money out of Argentine bonds. Borrowing rates skyrocketed.
While there’s no evidence anything similar is under way in the United States now, the damage may already be done.
When the August jobs report comes out, three weeks from now, it will be digested in the context of Trump’s reaction. A rosy report will raise questions on the left about whether the agency is placating the president, the way law firms, universities and multinational corporations have done. A gloomy report will be seen on the right as a proof of a plot to undermine Trump’s economic agenda.
The Beijing model
Trump’s realignment of American business also bears similarities to China’s model of “state capitalism” — a mix between socialism and classic free-market capitalism in which the state is involved in, but doesn’t directly own, private businesses.
“A generation ago conventional wisdom held that as China liberalized, its economy would come to resemble America’s. Instead, capitalism in America is starting to look like China,” Wall Street Journal columnist Greg Ip wrote Monday. Of course, the US hasn’t gone as far as China or even what Ip calls “milder practitioners of state capitalism” like Russia and Brazil.
“It is still a sea change from the free market ethos the US once embodied.”
In China, the ministries that produce its economic data are aligned with the party in power (which makes sense in a one-party system). And it’s not unusual for Beijing’s official stats to diverge from indicators tracked by academics and research firms. That is, if the national stats are published at all. In recent years, China’s National Bureau of Statistics has stopped publishing some numbers related to unemployment, with little explanation, according to a separate WSJ analysis.
To be sure, the US is nowhere near that level. But Trump, who has spoken openly of his admiration for Chinese leader Xi Jinping, isn’t just lashing out at the numbers on social media the way he has in the past.
Bottom line
It’s no secret Trump cares deeply about optics, and he very much does not want to be held accountable for “bad” numbers. Remember his fixation with his 2016 inauguration crowds? Or in March of 2020, as Covid-19 was beginning to hit the United States, when he argued for keeping passengers on a cruise ship at sea because he “would rather have the numbers stay where they are?” Or the time he was found liable for fraudulently inflating the value of his real estate holdings?
This time around, Trump’s obsession with optics has only deepened, while the deference to experts that he displayed in the cruise ship debacle has evaporated. The result, nearly eight months into his second term, is an economy that appears to be lurching into a new era of state control.