Saturday, July 23, 2016

Spending More, Enjoying It Less? Yup!!

Here's an interesting web page.

...The Chapwood Index reflects the true cost-of-living increase in America. Updated and released twice a year, it reports the unadjusted actual cost and price fluctuation of the top 500 items on which Americans spend their after-tax dollars in the 50 largest cities in the nation....

500 items?  Such as what?

...Starbucks coffee, Advil, insurance, gasoline, sales and income taxes, tolls, fast food restaurants, toothpaste, oil changes, car washes, pizza, cable TV and Internet service, cellphone service, dry cleaning, movie tickets, cosmetics, gym memberships, home repairs, piano lessons, laundry detergent, light bulbs, school supplies, parking meters, pet food, underwear and People magazine....

Looks like a fairly normal shopping list.   So why did this emerge?

...The inaccuracy of the CPI began in 1983, during a time of rampant inflation, when the U.S. Bureau of Labor Statistics began to cook the books on its calculation in order to curb the increase in Social Security and federal pension payments.

But the change affected more than entitlements. Because increases in corporate salaries and retirement benefits have traditionally been tied to the CPI, the change affected everything....

We note that was during the Reagan Administration, and was probably linked to Alan Greenspan's fabulism about "hedonic" prices, which, in short, postulated that Americans would simply adjust their spending by purchasing hamburger instead of steak, and would get more powerful chips in their computers for the same price as last year's less-powerful chips (etc.)

All well and good, but what if that American started with hamburger instead of steak?  Would they substitute fresh-cut lawn clippings for green beans?  Only someone like Greenspan could come up with such mumbo-jumbo.

The politicians loved CPI adjustments:  Clinton pulled the same trick during his regime.

Let's take Milwaukee.  The chart indicates that REAL cost-of-living increases in that town average 11.4% since 2011.  Compare to the FedGov's utterly ridiculous 2014 "0.8%" increase......well,  that's quite a swing, indeed.

The bad news:  no matter who gets elected, Gummint/Establishment figure-fixing will not change.

You lose.

HT:  RenMan


William said...

Read an interesting article on how who we elect really doesn't matter, as The Bureaucracy doesn't change. The leftist collective that runs the actual Departments does not change with a new Administration. So, nothing really changes much, as, if it's something the Mandarins don't like from the new Administration, they'll either slow it WAY down, or, ignore it.

Dad29 said...


And you notice that no candidate except Cruz mentioned actually cutting back Gummint?

Won't happen on Paul Ryan's watch, either.

William said...

Your phone # still the same? I was just thinking, I've been in 'stAllis for 5 years, and we haven't met for breakfast at Perkins once!