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Why the American Public Should Trust Key National Statistics

By Nick Hart, G. William Hoagland

Friday, August 10, 2018

In searching for areas of fiscal restraint, U.S. statistical agencies, which provide much of the information that helps us understand the American economy and society, can be seen as easy prey for the budget axe. That would be pennywise and pound foolish, and a blow to the very information needed to evaluate whether government programs are working properly, how the economy is faring, and ways that our society is changing.

Statistics produced by the federal statistical agencies are used to inform decisions made on Wall Street, Main Street, at both ends of Pennsylvania Avenue, and in local governments across the country. To make the best decisions possible, we need a core set of objectively produced facts that we agree are free from political influence.

The American people rely on data and statistics produced by a group of government agencies which comprise the Federal Statistical System to make decisions for their households, businesses, and government. These agencies are some of the oldest in government, with extensive history of providing reliable, objective data in a nonpartisan way.

U.S. statistical agencies provide the foundation for much of the evidence building and knowledge generation that occurs in science and policy analysis 

The country’s statistical agencies—including the Census Bureau, the Bureau of Labor Statistics, and the Bureau of Economic Analysis—produce key national indicators about our society and economy, including the population count, unemployment rate, gross domestic product, educational attainment levels, on-time performance of flights, and crime rates. The public, businesses, and government officials make critical decisions based on this information.

U.S. statistical agencies provide the foundation for much of the evidence building and knowledge generation that occurs in science and policy analysis, by providing reliable and consistent data. But for government statistics to be useful, the public must trust the information produced by their statistical agencies. Fortunately, statistical agencies take this charge seriously, and make great strides to ensure information is accurate, credible, timely, relevant, and objective.

Trust and Statistics

The nation’s statistical agencies abide by a set of well-established principles that have long been recognized as “fundamental” for designing, collecting, analyzing, and using statistical information. These principles developed over many years of practice. Recognizing the critical role statistical agencies play in providing an understanding of changes and developments in American society, such as demographics, the White House Office of Management and Budget (OMB) formalized these standards and practices in a series of guidance documents that apply to federal statistical agencies.

One core piece of guidance, called Statistical Policy Directive No. 1, describes four “fundamental responsibilities” for statistical agencies:

  1. Relevance: Statistics should involve useful information that is produced and shared in a timely manner.
  2. Credibility: Statistics are generated with appropriate statistical approaches that strive for accuracy.
  3. Objectivity: Statistics are generated in an impartial and complete way that is separate from other administrative, regulatory, or enforcement activities in government.
  4. Trust: Statistics that are constructed with confidential information protect the integrity of data to avoid disclosure of individual identities.

The goal is to ensure that Americans can trust that data collected by the government will be protected and trust the resulting statistics.

Strict Accountability and Data Use

Statistical agencies are subject to strict and specific laws that govern how data can be stored and used, and how privacy must be guarded. The confidentiality of the individuals, households, or businesses that underlie government statistics is protected, and extensive care is taken to avoid disclosing identities of individuals. Congress has also built in legal teeth, including civil and criminal penalties for the misuse or violation of the confidentiality of government data that identifies individuals and businesses. For example, the Confidential Information and Statistical Efficiency Act includes civil fines up to $250,000 and up to five years imprisonment for individuals who inappropriately disclose confidential data. These same protections also ensure that confidential data are not used for unintended reasons.

Another key protection is the government’s use of these data must be consistent with the purpose stated when the data were collected. While this can lead to limitations on research activities, this is a fundamental protection that ensures that the American public can trust the use of their sensitive information. The existing legal framework that guides these principles gives Congress, the president, and the American public opportunities to provide feedback and oversight.

Improving and Maintaining Trust

Additional steps can be taken to ensure government does everything it can to protect trust in data and statistics. The U.S. Commission on Evidence-Based Policymaking in 2017 issued a set of bipartisan and unanimous recommendations about better using data to inform key government decisions.

The commission said that the OMB guidance to protect public trust in government statistics is important for protecting privacy and for maintaining the integrity and objectivity of data and statistics. But, the commission points out, as a guidance document, the directives do not have the force of law. As a result, policy directives could be changed, which could result in undermining the public’s trust.

The commission strongly recognized that maintaining the public’s trust in government statistics was critical, and it recommended that the key provisions of Statistical Policy Directive No. 1 be elevated and written into law. The commission concluded that codifying that into law would further strengthen the “expectations of independence” of the statistical agencies, further protect government statistics from political interference, and also increase the ability for whistleblowers to report potential violations. The commission’s recommendation highlights the need for a higher level of certainty and the full backing of the law to ensure continued confidence in this critical federal government function of generating relevant and important statistics.

Congress Considering Changes

Building on the commission’s recommendations, Congress is considering changes that would codify Statistical Policy Directive No. 1. The Foundations for Evidence-Based Policymaking Act (H.R. 4174) that unanimously passed the U.S. House of Representatives in October 2017 would implement the commission’s recommendation and require statistical agencies to develop formal policies consistent with the directive. It would also require the OMB director to issue a regulation to implement the provisions. In practice, embedding these responsibilities into law will allow Congress the opportunity to exercise better oversight for how statistical activities are conducted in the federal government.

KEYWORDS: BIG DATA, BUREAU OF LABOR STATISTICS, COMMISSION ON EVIDENCE-BASED POLICYMAKING, OFFICE OF MANAGEMENT AND BUDGET, U.S. CENSUS BUREAU