President Bush wants to make it easier for the government's key statistical agencies to share data, and he wants uniform safeguards to protect confidential business information used in the government's economic reports, according to the White House's Council of Economic Advisers.
Those changes would require congressional approval, said CEA member Randall Kroszner.
"We have the best government statistics in the world, but that doesn't mean they can't be improved," he said.
The government produces a range of economic statistics that are used by businesses, Federal Reserve policy-makers and government leaders to keep tabs on the nation's economy and help figure out where it is heading.
Lynn Reaser, chief economist at Banc of America Capital Management, said the proposal might improve the efficiency of data collection and encourage companies to provide accurate data to the government.
"I don't think it will have a revolutionary effect on the understanding of the economy and the analysis of current events," she added.
Statutory barriers restrict the Bureau of Census, the Bureau of Economic Analysis and the Bureau of Labor Statistics from sharing economic data, thus "hindering innovation and limiting the improvements in the quality of economic statistics," the administration said.
One problem that pops up is inconsistent classification of companies, Kroszner said. Sometimes, that can happen because of human error, or because a company's focus changes, leading one agency to give the company a new designation, while another agency maintains the original classification, he said.
Allowing the statistical agencies to share information might cut down on those inconsistencies, he said.
Enhanced data sharing would improve the reliability and accuracy of key businesses statistics, such as reports on employment and the gross domestic product -- considered the broadest measure of the economy's health -- the administration said.
Businesses spend countless hours each year providing information to the government for an array of economic reports. That information is supplied on a confidential basis.
Policies and penalties for unauthorized disclosure of such information can vary by agency, Kroszner said, adding that the president's proposal calls for a "clear and consistent set of minimum statutory safeguards."
The details weren't spelled out.
The government has not had a problem with unauthorized disclosures of confidential business information, Kroszner said, but the rationale for the changes is that if companies feel more confident their information will be kept confidential, they'll provide more accurate data.
"The quality of U.S. economic information is probably the best in the world," said Ken Mayland, chief economist with ClearView Economics. "If it becomes more clear, there might be less need for me."
Copyright 2002. Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
