Wondering why your wallet has been getting easier to fold up lately? Have you noticed that every time you go to the grocery store or the gas station, you're getting less for more? You're not the only one - and yes, you are getting screwed! The case could even be made that you're being lied to.
While the average American consumer suffers through ongoing price increases (milk, eggs, bread, rice, gasoline, etc.), the government's official line has been that the country is only experiencing moderate inflation. The presidential candidates continue to pander to the voting bloc du jour - drinking beer & whiskey, going bowling, proposing meaningless gas tax "breaks", and anything else that can create photo ops and sound bites to grab (i.e. divert) people's attention instead of seriously discussing the economy. This sort of behavior crosses ideological lines and party affiliations, so don't be fooled. It's apparently been the same for years.
However, John Williams has been keeping it real for the past 25 years or so, when he first realized that the government was using fuzzy math when calculating economic statistics. Here's an excerpt from his site, Shadow Government Statistics, explaining the information he's providing and why he's providing it:
Have you ever wondered why the CPI, GDP and employment numbers run counter to your personal and business experiences? The problem lies in biased and often-manipulated government reporting.So, to summarize, since the politicians couldn't make the numbers look good, they redefined them instead. Here's the CPI (consumer price inflation) chart, which may well track with your experience at the grocery store:
We offer an exposé of the problems within the reporting system, and an assessment of underlying economic reality. Despite minor changes to the system, government reporting has deteriorated sharply in the last decade or so.
There is good reason for the gap between common perceptions and government reporting: government data are biased in politically correct directions and increasingly have diverged from common experience and reality since the mid-1980s. Inflation and unemployment reports are understated, while employment and other economic data are overstated, deliberately.
As you can see, the official story shouldn't really be believed (and that's putting it politely). The thick blue line shows what the CPI metric would be if calculated the same way that it was in 1980. The red line shows what they've actually been reporting over the same time period. One of these numbers has to be false... and no prizes for guessing which one.
Keep all of this in mind the next time you're paying the weekly vig at the gas station and you hear the talking heads on the radio telling you that it ain't really that bad. After all, who are you going to believe - them, or your lying eyes?
John Williams appears on CNN: