Posted on 07/25/2014 3:11:11 PM PDT by george76
In the early-1990s, political Washington moved to change the nature of the CPI. The contention was that the CPI overstated inflation (it did not allow substitution of less-expensive hamburger for more-expensive steak). Both sides of the aisle and the financial media touted the benefits of a “more-accurate” CPI, one that would allow the substitution of goods and services.
The plan was to reduce cost of living adjustments for government payments to Social Security recipients, etc. The cuts in reported inflation were an effort to reduce the federal deficit without anyone in Congress having to do the politically impossible: to vote against Social Security. The inflation-calculation changes had the further benefit to government fiscal conditions of pushing taxpayers artificially into higher tax brackets, thus increasing tax revenues. The changes afoot were publicized, albeit under the cover of academic theories. Few in the public paid any attention.
...
By lowering the official inflation rate, such changes promised to reduce the annual cost-of-living adjustments for Social Security and other federal programs.
...
The drive here was as to get a lower inflation reading, irrespective of whether the data were “more-accurate.
(Excerpt) Read more at economicpolicyjournal.com ...
Didn't they do the same thing under Carter? I seem to recall that then they excluded food, energy and housing from the CPI.
No kidding. An average pot roast cost $13 here inn my part of Georgia.
Price Index for Meats, Poultry, Fish & Eggs Rockets to All-Time High.
In January 1967, when the BLS started tracking this measure, the index for meats, poultry, fish, and eggs was 38.1. -— in May, it climbed to a record 252.832.
The CPI is a joke. They do crap like substitute even cheaper products that are not practically comparable and claim a savings. For instance: One year they may use Jiff Peanut Butter, but the next year they use a store brand that is not comparable in quality, then claim a price savings to offset the fact that Jiff went up 25% in cost.
If they bought one brand and compared it to the average cost the follow year, say best price over the same 30 day period, they would find inflation is significant.
Food, Fuel, Medical Insurance, Furniture, School Supplies, Education, Clothing, etc, are all up significantly.
and the Price of Electricity Hit Record for May.
http://www.freerepublic.com/focus/f-news/3168934/posts
It’s an accurate measure for those who don’t eat or drive or consume electricity.
I wish there was someone who calculated CPI the old way, so we could see the difference.
IOW all those dead voters.
Yet another example of how to lie with statistics.
The pathetic thing is that, despite banging our collective heads against the wall in frustration for decades & preaching just THAT, now that ANOTHER report is out about the truth...
...it won’t change a thing.
Government Work-Camp: Arbeitsziehungslager
All a Front Man for the East India Company
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