Misinformation about inflation is the new death panel, with Glenn Beck lying about how the CPI is calculated and Palin claiming the CPI has been rising rapidly (it hasn’t).
In both cases, the emphasis is on groceries, on what Real Murkins notice when they’re buying milk and eggs.
I wonder where this came from. I doubt these two grifters thought of it on their own.
Martha
Koch Inc subsidiaries, silly!
Happy T-day all from the left coast today, where they’re all whining about the cold. Gosh my family are wimps. But it’s nice to have someone else doing the cooking…
Mike Kay (Democrat of the Century)
it’s a conspiracy theory.
here’s at least one so called “organization” saying so.
http://www.prnewswire.com/news-releases/nia-addresses-sarah-palin-food-inflation-controversy-107030773.html
Since palin says her primary reading source is WND, I would imagine she picked it from there. That or drudge.
I would also add Bernanke criticized her lack of intelligence in the Halprin book, so he’s on her enemies list.
Punchy
Like everyone else, they got this from Andrew Sullivan.
Glidwrith
I don’t know if there are specific sources, but consider that Beck has constantly been pushing “Buy gold! It’s all going to collapse!” There’s also been rumors pushed that we’re facing a huge inflationary crisis because of all the money the government has been printing (courtesy of my wing-nut relations). Never mind that any accredited economist knows we’re on the edge of a deflationary spiral (ie Stiglitz and Krugman); perhaps this is just a further effort to fear-monger and keep up the grift.
buckyblue
@Martha: I’m on the west coast for the holiday too, from cheeseland. Seattle is completely shut down for three days for what I would consider a light dusting. But I’ll tell you, 15 degrees still feels like 15 degrees.
WyldPirate
You know, both Beck and Palin may be lying about how the CPI is calculated to some extent, but what one always hears on the news is the core CPI which does not include food and energy prices.
Sometimes the media neglects to add in that little tidbit. That’s kind of stupid as food and energy prices are major expenditures in most of the budget of the proles.
Doesn’t change the fact that Palin and Beck are both congenital liars.
edwin
All lies – all the time?
brantl
What they are playing on is what my wife remarked to me the other day, food is going up like crazy. What do people pay for more often than anything else, and out of pocket to boot? Food.
That they don’t know what they’re talking about isn’t a plan, it’s just SOP.
joe from Lowell
The right wing always does this; they try to work the Fed in order to get pro-expansionary policies under Republican presidents, and anti-expansionary policies under Democrats. In 2003, for instance, National Review was full of dire warnings about an impending “deflationary spiral.”
DougJ
@WyldPirate:
But they’re always clear about how they report it, whether they’re using all item CPI or core CPI.
Anyway…all item CPI is still very low and increases in food prices are very low.
Martha
@buckyblue: I’m luckier than you, I’m down in “Cawlifornia”…where it’s a balmy 38 rising to 54. You’re right though, if snow is involved, it’s cold!!!
joe from Lowell
@WyldPirate:
That depends on what they’re talking about. Food and energy are particularly susceptible to price fluctuations that have nothing to do with the overall inflationary environment. Gasoline is always spiking and dropping, completely unmoored from the inflation rate, for example.
So, while food and energy prices are certainly important as a measure of the economic situation people face, they don’t actually tell us very much about whether the Fed should do something to tamp down inflation, or whether it’s safe to promote job growth even if it causes slightly higher inflation.
DougJ
@brantl:
Food is up 1.4% October 2009 to October 2010. That’s very low.
srv
Where have you been for the last two years? Ever read Krugman? All of Obama’s spending-hyperinflation-meme has been going on for near two years now. As soon as any indicator can be politically misread, it will be.
And your clothes will cost 30% more! Never mind the floods in Pakistan/India that wiped out the cotton fields, or the drought in Russia, it’s Obama’s deficit!
Here’s something to throw back at them. Of course, Alan probably has a newer article somewhere about Obama’s CPI being the end-of-the-world.
Mike Kay (Democrat of the Century)
@joe from Lowell: This. Also, too, remember how they got Greenspan to support the bush tax cuts by saying using the surplus to pay down the debt would be dangerous because without government debt to buy and sell the Fed wouldn’t be able to use monetary policy to regulate the economy. In short, Debt was Good.
PanAmerican
Well, according to Alan Simpson, isn’t the problem old bucks, spending their social security checks on t-bones and Cadillacs?
WyldPirate
@DougJ:
I disagree that “they’re always clear about how they report it”.
And food prices are “very low”? They must be paying you way too much at the U of R and you’re not noticing it at Wegmans when you go shopping. Me, as an unemployed wretch trying to stretch every dime—-well, prices have gone up, especially in the food arena. We’ve been hit with two years of utilities increases that have been pretty steep as well, particularly with regard to out coal-powered electricity.
Yeah, I know, it’s anecdote, but still, I’m coming away with much bigger grocery bills than I did a year ago and I haven’t chenged my shopping habits very much.
joe from Lowell
This country could use higher inflation right now. Not 1979-era inflation, but something along the lines of 3-4%, instead of 1-2%.
1) Higher inflation would raise the nominal value of all of those underwater homes, while their mortgages stay the same, thus lifting them above water. A depressed housing/construction industry is one of the big reasons we’ve had slow growth over the past year. Also, bringing these homes above water would prevent a lot of foreclosures – the good of which is obvious – which would also then make a lot of those toxic assets less toxic, thus improving the situation of the banks, and allowing them to operate normally.
2) Higher inflation would decrease the value of the existing national debt, which is too damn high. Two points more of inflation for a period of 10 years would mean a reduction in the real-dollar value of our $13.5 trillion national debt of $2.2 trillion, without raising taxes or cutting services. Who wouldn’t want that?
3) Higher inflation would get the banks who are sitting on money to put it to more productive use. We’re in a credit crunch right now because “lenders” are hoarding their cash, sticking it in low-yield bonds and such instead of lending it out. Higher inflation would motivate them to put that money into higher-yield ventures, like business loans, thus stimulating the economy.
milo
@brantl: Except it’s not true. See the Consumer Price Index Summary. All items = 1.2%. Food = 1.4%. Your wife may think she sees a difference of .2%, but I doubt it.
dk
This meme has been spreading on social media sites all over too, stated matter-of-factly. The fun part is when you link to stats about it they stop responding :)
lamh34
. I’m not sure where plain & nem get their info, nut I do know that here in NOLA items that once cost about $1 a lb now cost about $3. But that is probably due to a combo of the economy and lingers of Katrina.
Happy turkey day everyone
Obama pardons 2 turkeys
Those kids are just sprouting up aren’t they!
WyldPirate
@joe from Lowell:
I don’t disagree with what you are saying Joe, but it does make a difference in a lot of respects when you’re down at the lower end of the income scale.
For instance, I remember back in the late 60s-early 70s when you could pick up a loaf of bread for about 0.35 and a gallon of milk for maybe a little over a 1.00 and gas was about 40 cents a gallon.
Now, that loaf of bread is over $2 (6-fold increase), milk is close to $4/gallon (4-fold increase) and the gas has gone up 8 times.
Has minimum wage increased that much over that time frame or has even the median wage increased that much over the same time period? (Rhetorical question)
My point is, that these changes in prices are rather harshly felt at the lower rungs when you have to make every penny count and any expense out of the ordinary turns your world upside down.
Mike Kay (Democrat of the Century)
@WyldPirate: of course palin was trying to link food prices to fiscal and monetary stimulus.
to the extend milk and fruit go up, it’s hardly due to some government funded airport construction or the modest 2.5% growth in GDP. the supply and demand of food itself has a much larger impact on prices in todays climate.
David
The fearmongering has two purposes:
Runaway inflation can lead to political upheaval (HINT) and
Glenn Beck’s sponsor sells some gold.
WyldPirate
@DougJ:
It’s a huge deal if your income has taken a 50% cut.
zzyzx
@buckyblue: Let me explain the reasons once again why Seattle shuts down for little snow:
(1) The temps stay around freezing when it snows which means we get melt and freeze cycles
(2) We have TONS of steep hills everywhere
(3) It snows so rarely here that we have only a dozen plows for the whole city
oh and
(4) There always are a bunch of east coasters and midwesterners who laugh over a few inches of snow who think it shouldn’t be a big deal and get stuck on the West Seattle Bridge or the Queen Anne Counterbalance…
WyldPirate
@Mike Kay (Democrat of the Century):
Look, I’m not disagreeing that Palin and Beck are lying wretches. That’s not my point.
My point is that:
a.) these things matter to people when they are under economic stress
b.) It’s a populist maneuver on their part to get old folks and poor white folks riled up about things they don’t understand.
There are trade-offs with QEII that can help our economy as Joe illustrates quite well above, but there are also some downsides to it as well. There can be inflation and that hits the poorest people the worst. It can help expand our exports, but it can decrease wages as well and how far they can extend because we simply don’t make some of the shit here that a lot of people use on daily basis anymore.
I don’t really think that Palin knows a goddamned thing about monetary policy. OTOH, I don’t think QEII is going to help very much either, because the money boys have a long way to go to squeeze production out of people here and from their low-paid offshore subsidiarys. Until some of the jobs come back and people that have them aren’t scared out of their minds about losing theirs, then recovery is going to be slow. On top of that, much of the “keeping up with the Joneses” mentality was fueled by easy credit. That shit is gone now.
joe from Lowell
@WyldPirate: I restated your point myself:
My point is that it is dishonest and counter-productive to claim that the increases in food prices have anything to do with overall inflation rates, or to give comfort to those who think it’s a good idea to engage in inflation hawkery.
If we don’t have a pro-growth, slightly inflationary policy from the Fed for the next couple of years, a whole lot more people are going to see their incomes cut in half, which is the actual cause of the pain at the low end of the income scale, not a 0.2% increase in food prices.
joe from Lowell
@WyldPirate:
…and it’s absolutely not a big deal at all if your income hasn’t taken that cut.
Which is why public policy, and discussion of public policy, should focus on jobs and growth, not inflation.
Elia
They’re probably referencing this successful Reagan ad.
Dennis SGMM
@zzyzx:
Oh yeah. A few years ago we drove up to Seattle to visit the relatives. There was maybe a foot of snow on the ground. I didn’t think anything of it until we headed up to my aunt’s house up on 24th NE.
zzyzx
Same thing happened to me when I first moved here. I used to drive in snow all the time on the east coast… it’s a much different experience.
GregB
This goes hand in hand with the rewrite of what unemployment statistics mean.
Up to and till the end of the Bush administration there was never any talk of “underemployed”. Once Obama came in to office there were many media outlets that started to smush together the unemployed with the underemployed and came up with a number around 20%.
It is just like the bean counters who used Clinton’s election stats and then compared them with Bush and Perot. Thus delegitimizing Clinton as not really elected by a majority.
sven
@joe from Lowell: I think the combined effect of #1 and #3 are especially important. Many of the actors in the housing market have been unwilling to move and realize what may be large losses. Rising inflation seems like one of the few forces which might finally clear the housing market.
DougJ
@WyldPirate:
It is one of the smallest increases ever recorded year over year.
Linda Featheringill
@DougJ:
[#13]
Hogwash.
gbear
@zzyzx: Video of cars trying to make it uphill in Seattle snow (courtesy of That Will Buff Out)
We had a bit of that in MN this week. A mix of snow and sleet that caused hunderds of accidents. Today is finally sunny but the temps have dropped into single digits. I’m glad I’m not travelling today.
slag
Help I want a pat down and I’m not flying anywhere.
Also the inflation fear things has been around for a while. Or at least Paul Krugman has been smacking it down for a while.
WyldPirate
@joe from Lowell:
Of course public policy should focus on growth and jobs. The problem is that it fucking hasn’t for decades. Sure, we have had growth, but it sure as shit has gone to the middle class. The coped and kept up by maxing out credit cards (while Joe Biden and Dems in Congress help the Credit card companies rip them off) and using their homes as ATMs by cashing out the equity in them.
Median income has been stagnant since the 80s. Under Bush, the median income actually went down when it was adjusted for inflation. This is why the lies from the Palins, Becks and other shitheels from the Rethugs are resonating with the white working class.
Look, I don’t disagree that QEII might be a useful tool. FSM knows that it is one of the few tools left in the tool box to try to get the economy kick started. I hope it works.
I also find the lies from Palin and her ilk appalling. But you know what? They fucking work.
And you know what else? You’re not going to see much of shit from the Dems or Obama to counter the lies. Olberman and Richard Wolfe had a great exchange last night about some of the wretched excesses coming out of Wall St. yet again and what a great opening it was for the Dems to pound on the Rethug about the Rethug lunacy regarding the tax cuts and their stupid “business isn’t spending because of the uncertainty in the investor class”. But will we see a peep from the Dems about this? Fuck no we won’t. They’ll get the message wrenched away from them again by lies like the horseshit coming from Palin.
debit
@gbear: I stayed inside last Saturday when Chloe slid right down the steps on her first potty break of the day. I don’t know why people think they can drive on ice.
And I wish I could stay inside today (brrrr) but am expected for dinner with my parents.
inkadu
If people just made pizza from CostCo-purchased dough and cheese inside of wood-fired brick ovens, they wouldn’t have any problems with their food budgets.
What ever happened to that guy anyway?
cleek
NYers who moved to NC have the same complaints: no plows, native drivers don’t know how to handle snow, no shoulders on the roads even if they do plow, etc..
edwin
http://www.foodreference.com/html/ffoodcost.html
I believe that the tea party supporters have correctly identified that things are looking bad. Unfortunately they are looking at the causes of their problems for solutions. Multinational companies and authoritarian populists who will say anything will not help them out. Picking on one of the few items that is actually potentially undervalued also is not a good strategy.
Bill Murray
The point about high inflation claims are to deter any possibility of further stimulus to lower unemployment and to delegitimize the effects of the previous stimulus.
If you look at the CPI data (http://www.bls.gov/cpi/cpid1010.pdf) core inflation over the last year has been very low. Food price inflation has also been very low, although over the last month (October) dairy and meat, poultry fish and eggs were up, fruits and vegetables, and nonalcoholic beverages, were down as were cereal and bakery goods.
Energy is actually the big riser — gas was up 4.6% in October as was fuel oil. Over the last year, energy is the only area with any real increase, which may indicate the speculative pressure that caused the high prices in 2008 may be back, or it may just be a natural rise after a high percentage dropoff in the summer.
inkadu
@GregB: I think it was Obama himself who started raising the importance of the underemployment rate. Maybe it’s because Obama was stepping into a mess and knew it was wise to make it look as bad as possible early. Or maybe he’s just an honest guy who is sincere about addressing the problem.
slag
@edwin: Clearly, the average American isn’t shopping at my co-op. Holy shit. Can’t get out of there with two bags of groceries for under $100. Although most expensive items are usually toiletries and other sundries.
techno
After doing nothing but hype the fear of inflation for the last 35 years, the economics profession has lost the ability to do anything else–even in the midst of deflation.
As for inflation–I sure don’t see it. Yesterday, I bought milk for $2.14 a gallon, butter was $2.69 a pound, eggs were $.99 a dozen, and my favorite brand of ice cream was $2.50 for the 1.5 liter package. I won’t even mention that turkeys were $.38 a pound because they were obviously loss leaders. Housing prices are down 40% in the last two years in my neighborhood, etc. etc. etc.
Whatever inflation there is, it certainly isn’t enough to materially affect Fed monetary policy.
Mike Kay (Democrat of the Century)
of course the follow-up question is: if palin believes the price of food is going up what would she do to bring prices down?
also, too. If she believe in the free market and small gubment, should gubment farm subsidies be eliminated?
ornery curmudgeon
Because Palin and Beck are simply looking out for the People. They care.
And of course, those who are pointing fingers can never be the guilty party. Obviously. It’s right there in the playbook.
Duane
@WyldPirate:
I guess I am not sure how comparing the prices of items from the 60s/70s has anything to do with the change in food prices over the last year. It doesn’t in any way refute the fact that in the last year food prices have only went up 1.4%.
I will add that losing your job and having 50% of your income go away does for sure suck….. but that is what the problem is, not the price of food.
Linda Featheringill
Thanksgiving songs.
Also, Bill in Portland, Maine has a list of things to be thankful for [Cheers and Jeers].
I am having a day in which I can be messy, unkempt, and lazy. It is a beautiful day and it’s good to be alive.
Wishing all of you a happy thanksgiving. I’m off to putter about in the kitchen.
dhd
@Bill Murray:
See, there’s the problem. Real Americans do not eat fruit or vegetables, no matter how hard Michelle Obama tries to force them to.
joe from Lowell
@WyldPirate: Props on the righteous rant.
There is indeed a danger of the Republicans winning the message war.
Liberals and lefists shouldn’t help them. Scare-mongering about inflation is a way of tamping down efforts to promote growth – a deliberate effort, intended to smooth the path for a right-wing takeover in two years.
grunculus
@Bill Murray: GMTA – I was just about to point to the same BLS report.
.
Another thing to note is there are regional differences. Take a look at the city data (starting on page 55). Areas that have had their housing markets decimated and/or have high unemployment are going to have lower overall inflation.
.
Krugman pointed out that food inflation is volatile. That doesn’t help people who have seen prices of staples increase while their incomes have fallen, but it does indicate that it’s not feeding general inflation.
.
If the past is any guide, inflation will not rise substantially until GDP grown rises substantially and unemployment falls substantially – Brad DeLong.
.
Cheers,
Scott.
Jewish Steel
I flew from ORD (tornadoes) to SEA-TAC (blizzard) on Monday. I took the light rail downtown and 5 was a parking lot. It’s like visiting Illinois in February.
Calvin Jones and the 13th Apostle
@joe from Lowell: And most elected Democrats run away from the issues. And don’t want to be engaged on them(Hello DLC/Blue Dogs!!). That’s why it is important to get the jobs machine cranked back up. How you do that can be debated. But it needs to be done.
BGK
@edwin:
Yeah, that pretty much describes my daily routine at work.
Weather? It’s 82 and sunny here, as I sit on my lanai with an assortment of small carnivores laying around, sawing the wood.
Napoleon
@WyldPirate:
Read Krugman’s blog for why there is a very good reason to take them out of the calculation to get a better reading of what the true underlying long term inflation rate is. There is a reason there is a core inflation rate.
Napoleon
@WyldPirate:
Funny, when they gather prices for the statistics they prepare the increases they record are very modest.
Sly
Professional Goldbugs. Beck probably got it from a combination of his business relationship with Goldline and the dregs of Mises.org, the latter of the two having named their “Institute” after a guy who accused Milton Friedman of being a communist.
Palin is simply taking her cues from Beck.
BD of MN
you can tie this to the banksters… Hedge funds are into the corn and soybean markets in a big way which means prices are going up, and what do all those cows, pigs and chickens eat? It was a great year to be a farmer if all you do is grow crops, but the dairy farmers are getting murdered by the high corn prices… (ethanol producers are also getting killed, which may not necessarily be a bad thing entirely…)
WyldPirate
@Duane:
I meant it as more of an illustration as to how the middle class has stagnated since the mid 70s-early 80s. I’m taking the long view of things and trying to explain why these old white folks are so easily riled into hatred of Dems by the Republicans.
But let me start out with this. I don’t disagree with you that the 1.4% doesn’t seem like much of an increase for food. What does hit home though is when it takes 1/2 your take home pay to feed your family and you’re running out at the end of the month.
But back to the late 60s-early 70s. I was a kid in the 60s. Started 1st grade in 1965. I lived in a lower middle class neighborhood of factory workers who worked mostly at the Ford Motor Company Glass plant in Nashville, TN. Everyone of the families had “stay at home moms” and kids roamed the neighborhoods. People with and without high school educations had jobs that they could support families on and own their own homes without having both mom and dad working and shoving the kids in day care. Then school segregation came along in the early 70s and all of those white folks that held most of those better UAW jobs and other decent factory jobs in Nashville got the hell out of town.
Those parents from that era–like mine who are in their mid 60s to late 70s now–are the core of the Tea Party movement today. They see that those types of jobs at the Ford Plant have gone because Ford spun the plant of to some subsidiary, downsized and outsourced and pays less than they did 30 years ago in absolute dollars and without even a tenth of the same health and retirement benefits. They see their kids–many of whom they were able to put through college–doing worse even with two9 people working or, even have their kids losiing their homes and having to move back home temporarily. They are pissed and they look for anyone to blame that they can find. On top of that, they have the leftover vestiges of the Jim Crow Sthat they grew up with lingering in the back of their mind.
These people are not just living in the South either. They are working class white folks living all over the country. Many of whom did the same sort of thing when their schools or neighborhoods were integrated (South Boston is a prime example).
My point with all of this is that many of these folks while good people in many ways, are easily fired up and led astray and look to an “other” to blame at the first opportunity instead of the real culprits. This is why the Reagan’s use of Nixon’s “Southern strategy” worked so well so long ago. This is why assclowns like Palin, Beck and Limbaugh can stir them up so easily. Hell, it’s even why the Southern aristocracy could get poor whites to fight their war to maintain slavery.
So many of these people are reacting based upon emotions. They remember a better time and they see things worse now. They see someone they couldn’t have even imagined living next door to and that would have caused them to move now living in the White House. Now add in a bunch of theft and lies that have cronked the nations economy and led to it being stirred up into a frenzy of hatred for the “other” brown enemy that is different–the Muslims. Get some crazy race baiters stirring that up on the talk radio that these people listen to or watch and they see these friendly white faces screeching at them and telling them that that Black Muslim Indonesian is the cause of all the problems. That he’s taking their health care and that he’s going to tell them what they can eat.
These people aren’t responsive to real data. They don’t know that GDP has gone steadily up since their working days but that the top 1% has taken 85% of that increase in wealth. they don’t know that the banks cranked the economy and gypped them or their kids out of their nest egg of a home with the crazy financial instruments. That hundreds of billions of tax cuts during wars started over lies by Rethugs have caused the huge debts.
It’s far easier for these people to buy as “fact” what that pretty Sarah Palin is tellin ’em in her sing-song non-sense. It’s far easier for them to buy the horseshit from Hannity and Limbaugh and Beck. They don’t have to do any research. There is a trusted white face tellin’ who to blame.
It’s not much different than 100 years ago when you had poor white tenant farmers getting manipulated and robbed by rich white landowners (substitute factory workers and monopolists for the industrialized north). You had those nice respected people who look “just like us” telling you who was at fault for all of your problems. It’s easier to stir them up against the people who are a bit more oppressed. That allows the wealthy to more easily deflect the blame from where it really belongs and makes it easier to continue the theft and accumulation of wealth.
Joseph Nobles
How to be Glenn Beck, Part 1
1. Try to figure out what’s about to happen.
2. Find a way to blame it on Obama and George Soros.
3. Cry.
4. Repeat.
Mnemosyne
@BD of MN:
Well, you can, but it’s actually tied pretty directly into gas prices. If gas costs more, it costs more to move the food around the country. If it costs more to move the food, food prices go up.
California grows something like 50% of the food for the whole country. Throw in the transportation costs from coast to coast and you’re talking about a pretty big rise in costs for the grocery stores that they pass along to consumers.
mikkel
There are some real criticisms to be made about CPI that knee jerk reactionism against Beck et al. misses. The CPI is not a straightforward measure of goods where they define a constant basket and track the prices in a continuous matter. It is a survey of actual consumer spending. This can make a huge difference!
The CPI has general categories but not specific items so when prices rise you will often see a substitution effect where people will buy down in quality or their consumption patterns will change in other ways. As the CPI site says:
It is definitely possible to have people complaining about inflation in the things that they bought before while seeing little overall price inflation because they switch purchases. Also look how few families are interviewed, and the types of surveys definitely won’t be random samples based on the nature of the poll. I’m haven’t seen a study of it but I can guarantee that the type of people that are willing to fill out diaries and answer long questionaires accurately are going to also be the types that try to save as much as possible through changing their behaviors. It is only after making the “basket” from those surveys that prices are then tracked at the retail level.
It’s also bull that monetary policy isn’t affecting anything but that’s primarily because of the financialization of commodities starting in 2000. The end level pricing of food/fuel is largely determined by demand which means that commodities soaring or falling affects margins far before prices…and there is a ton of evidence that commodity pricing is now largely a function of liquidity and leverage rather than delivered contracts. This is squeezing margins way more than would exist otherwise and comes at the cost of workers in the system.
Beck and company are liars that are espousing ideas that will hurt America but the reason why they are so effective is that the messages are built around a grain of truth that is far more accurate than the Krugmans/DeLongs. The world has changed a ton in the last 10 years and the liberal economists jut don’t get it — other than Stiglitz who is by far the best economist when it comes to being right on the zeitgeist and how that ties into economic theory. I personally wouldn’t shed a tear if no one read one thing that Krugman wrote if it meant that Stiglitz became the new face of liberal economics.
Bruce Baugh
I’d guess that the talk about a few core food items in particular is probably an effort to coopt the “catfood commission” language, to make it “If we don’t cut off Those People good and hard right now, you, Mr. and Mrs. Godfearing White Straight Cis American (or at least someone willing to pretend to be them), will be stuck unable to afford anything to eat but catfood. We’re here to protect you by making Them suffer before They can make you suffer. So if you find yourself needing to eat catfood, remember, it’s the fault of the minorities, the ungodly, and the queer.”
Keith G
@WyldPirate: I also am noticing a de facto increase in some food items that is significant. Some prices seem unchanged over the last year.
Fresh veggies are up in my neighborhood, as are pork. Milk seems steady, but for some quick down and back changes. Beef slightly up as is bread. Franken-farm chicken haven’t changed prices in memory. Processed foods have climbed a bit.
While overall food inflation may seem minor due to dairy and chicken, I can see where some can really be hurt by those areas of our grocery choices whose prices are shooting up.
Tom M
the messages are built around a grain of truth that is far more accurate than the Krugmans/DeLongs.
What was it Linda said? Hogwash is mild. Calm down before you hurt yourself.
Also look how few families are interviewed, and the types of surveys definitely won’t be random samples based on the nature of the poll.
Christmas, that’s just dumb.
Bye, have a nice thanksgiving. And thanks; one less commenter I will read.
Zuzu's Petals
@mikkel:
Well, how does this factor in?
mikkel
@Tom M:
Yes it’s dumb to bring up a basic point that every survey in existence has to deal with and gets worse the more time and labor intensive it is. And even if that is minimal it still doesn’t address substitutions etc.
Oh and here are a couple of other fundamental reasons that CPI can greatly get detached from what people are seeing on the ground:
The index weights are only updated once every 10 years, so there will be large drift if a few component categories (like I dunno, energy and food) have a rapid change in relative income expenditures.
The index is built on total expenditures so they are weighted towards upper income households. As noted very clearly in the paper, in environments where necessities rise faster than luxuries, the CPI will understate. A running theme amongst the people that have best called the financial crisis is “inflation in the things that we need and deflation in the things we want” or exactly that scenario.
So yeah, there are a lot of fundamental reasons why the CPI may not be reflecting what people are seeing on the ground. It may be doing well, it may not be, but what is definite is that pointing to it as the Truth and attacking anyone that questions it is not only stupid politically but doesn’t pay attention to the actual construction of the index. This is why Krugman is a joke compared to Stiglitz: they have the same fundamental understanding of the economy but Krugman just looks at the (increasingly circumspect…don’t even get me started on employment or GDP) numbers and talks about how they can be moved around while Stiglitz has written a host of papers and books that critique the underlying assumptions of the numbers themselves and tying it into why our economy sucks.
The Democrats are right in the abstract but are increasingly detached and the rabid Right is pouncing on that to encourage a very destructive movement. Sitting around bitching how stupid people are by pointing to data while not knowing even the basics about how it’s constructed won’t fix that.
Zuzu's Petals
@mikkel:
Okay, I think I’ve found the basic flaw in your argument. From your own BLS quote:
Now, from the BLS webpage itself, which you did not link to:
In other words, BLS relies on consumer diaries in order to put together the market basket and determine the relative weight to be accorded each item. However, the department itself tracks the actual pricing of those items over time.
So contrary to what you claim, the CPI actually IS “a straightforward measure of goods where they define a constant basket and track the prices in a continuous matter.” Meaning the so-called “substitution effect” means nothing in this context.
mikkel
@Zuzu’s Petals:
Like I alluded to above, it takes place in two steps. The first is to determine the basket by doing the surveys and the second is to go around to the stores and get the prices…and it’s the first that will form the composition. [I may have been wrong above about how often they adjust the weights. I was reading something old about the 10 year critique, but I haven’t quickly found about how quickly it is rebalanced these days.]
The CPI has a long data series but it’s been changed twice (that I’m aware of) with what I’m referring to being rather recent with the report released in 1996. Wikipedia says the CPI was changed in 1999:
I quibble with the idea that it overstates inflation, it overstates cost of living expenditures. Which is my entire point about how people can complain about inflation even if it’s not seen in the indexes: because the indexes are designed to account for buying a different thing in a different place in a different amount if the objective cost rises!
Note that the BLS does do what most people would think of as a straight calculation, when it goes to the stores, it just weights them later and we don’t see that.
General Stuck
In other Palin news, which seems to be congealing into some sort of giant MSM mind – ray of stupid, I had a little trouble following the latest Wassilla Wingnut Brain Farts. But came away with the thought, did she just call our ally North Korea fat?
We need a Palin Enigma Device to break this code.
Zuzu's Petals
@mikkel:
But you said “[t]he CPI is not a straightforward measure of goods where they define a constant basket and track the prices in a continuous matter,” which is demonstrably false.
James E. Powell
@WyldPirate:
If you’ve had a 50% pay cut, the problem isn’t the small increase in prices. To expect the federal government to stimulate employment is reasonable. To expect the federal government to control against small fluctuations in commodity prices is not.
noncarborundum
@General Stuck:
That assumes there’s an actual message to be retrieved from under all the gobbledygook. This is a questionable assumption.
mikkel
@Zuzu’s Petals:
How is it straightforward when the final CPI number presented to the public doesn’t measure the same goods consistently either in type, location or quantity, subject to what a few ten thousand people around the country buy?
Zuzu's Petals
@mikkel:
According to the BLS, that’s exactly what it does.
Ron
@Linda Featheringill: An inflation rate of 1.4% for food isn’t very low? What should it be? I don’t understand this at all.
Ron
In general, the fact that Palin and/or Beck is lying is not particularly surprising. At this point, I pretty much expect almost anything coming out of their mouths to be a lie.
As others have noted, there IS a “core CPI” which ignores the volatiles like energy and food. The question is what are you trying to address. If you are interested in “what is the average american dealing with” then the one including food/energy is relevant. If you are trying to deal with monetary policy, it isn’t.
Both food and energy go up and down a fair bit for what seem to be completely different reasons, but neither of them seem to be something to base your monetary policy on.
Cain
@zzyzx:
We live on a hill in Portland. If it snows, you better be carrying chains as you’re not going to be sleeping at home otherwise.
cain
dj spellchecka
the entire thread and no one mentioning little milton?
Grits Ain’t Groceries :
http://www.youtube.com/watch?v=4DaaJ4EPYwI