Catherine Rampell and Michael Steinberger: Trump Wants to Cook the Books

What It Covers

Catherine Rampell analyzes weak jobs data showing 4.6% unemployment and manufacturing losses amid Trump's tariffs. Mike Steinberger discusses Palantir CEO Alex Karp's political shift rightward and the company's expanding surveillance work with ICE.

Key Questions Answered

• •Economic Stagflation Risk: Unemployment reached a four-year high at 4.6%, with job losses in three of the past six months and seven consecutive months of manufacturing decline. Federal Reserve staff estimate actual job numbers may be overstated by 60,000 monthly due to measurement difficulties during economic downturns.
• •Tariff Revenue Illusion: Trump claims abundant tariff revenue can fund tax rebates, debt reduction, and free IVF simultaneously. However, the Supreme Court may rule these tariffs illegal and require refunds to companies. Alternative tariff mechanisms exist but require longer implementation processes and reduce Trump's ability to use tariffs as immediate leverage against allies.
• •Statistical Agency Gutting: Trump fired all staff compiling poverty guidelines that determine food stamp and Medicaid eligibility. The Bureau of Economic Analysis lost 20% of staff and cut tracking of foreign investment in the US economy, making it impossible to verify Trump's claims about economic performance while he simultaneously makes bold promises.
• •Palantir's ICE Expansion: Palantir provides foundational software for ICE's surveillance apparatus, which now scrapes social media to monitor critics of the administration, not just deportation candidates. The company sees Trump's second term as an opportunity to become so deeply entrenched in government operations that switching vendors would be extremely disruptive for future administrations.
• •Karp's Political Metamorphosis: Alex Karp shifted from identifying as a neosocialist who feared fascism to supporting Trump's immigration crackdown after October 7, 2023. He now frames defending the West as a cultural project rather than defending liberal democracy, aligning with Peter Thiel's view that economic freedom matters more than democratic governance.