Re: Fraud in the CPI


"Rumpelstiltskin" <PleaseDoNotReplyByEmail@xxxxxxxxxxx> wrote in message
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On Sun, 2 Dec 2007 21:01:02 -0600, "John Galt"
<whoisjohngalt@xxxxxxxxxxxxxx> wrote:


"Rumpelstiltskin" <PleaseDoNotReplyByEmail@xxxxxxxxxxx> wrote in message
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On Sun, 2 Dec 2007 08:09:13 -0600, "John Galt"
<whoisjohngalt@xxxxxxxxxxxxxx> wrote:


"Rumpelstiltskin" <PleaseDoNotReplyByEmail@xxxxxxxxxxx> wrote in message
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On Sun, 2 Dec 2007 07:07:56 -0600, "John Galt"
<whoisjohngalt@xxxxxxxxxxxxxx> wrote:

<snip>


A rigid, no-subs policy obviously results in a higher CPI, which is
obviously good for SS receipients. However, it doesn't accurately
model
the
inflation in the economy.


If it "obviously" results in higher CPI, doesn't that
mean that the current situation is "obviously"
understated? Unbiased substitutions shouldn't
all trend the same way if they're really unbiased.

No. The objective is to accurately model inflation in the economy. This
is
not a simple task, economists disagree on how best to do this, and
further,
opinions on the matter evolve as the art of economics becomes more
advanced,
economists advance new and better ideas as to how to do it, etc.



If "the economy" doesn't mean the welfare of people,
it doesn't really mean anything of much note, IMV.

The economy is the function of a country's business environment. "Welfare
of
the people" is related in that people depend on that economy for their
livlihoods.



Cart before the horse, IMV. It's the business environment
that's a prime consideration only insofar as it improves the
commonwealth. Without that, it's good for nothing more
than the wealth of the French aristocracy was good for the
peasantry.

It's symbiotic. People can't have a livelihood without the economy, and
there is no economy with the people.

S
things are claimed to be complicated even in their
everyday ramifications only because some persuasions
want to fog up reality, IMV. Of course, I am a "liberal".

"Reality" is subjective.



The commonwealth is not subjective in the large,
it's pretty plain to people if they're significantly better
off some times than others, though one could carp
around the edges.

Sure. My point is that what a good "reality" is varies from person to
person. A communist prefers the business owner to earn the same and live the
same as the laborer; the capitalist understands that one will live better
than the other. The former might look at an economy where the owner earns 5%
more than the laborer, and scream "UNFAIR", while the capitalist would see
the two as far too close.




I do buy frozen ground beef, but right now "steak"
is on my shopping list for the next trip to Costco but
hamburger isn't, even though I still have some of
both in my freezer.

Maybe we should have a pet-food index, counting
the number of people who are living on pet food
because it's cheaper, today versus ten years ago.
(I've never known anybody who does live on pet
food, but I'm assured by urban-legendists that there
are some.)

Well, I'm sure their legends are .... urban.


Maybe so. I sure do hear a lot about people eating
pet food, but it might be like the welfare queens
driving Cadillacs, at least new ones rather than
wrecks - far more common in legend than in reality.

I'd think. The US has the richest poor people in the world, pretty much.
After all, the biggest dietary problems amongst the US poor are .....
obesity and its attendant diabetes.


I don't think that's true.

I think it's quite true. Home ownership (not just during the recent bubble,
but over decades), computer ownership, television ownership, auto
ownership......name it, amongst the lower 20% of Americans, all much higher
than in the lower 20% of other countries. The lower class is rioting in
France for a reason. The condition of the lower class in Britain was the
subject of my major professor's doctorate at Oxford in the early 90's, and
the picture wasn't pretty. The squalor of the poor in Sweden is documented.
The fact that they have health insurance and some money coming in on the
dole doesn't give them the ability to obtain certain niceties of life that
we all (up and down the income scale) prefer to have. Go to a poor minority
middle or high school in your neighborhood and look around. You'll see gold
jewelry, $150 Nikes, those expensive NFL and NBA jerseys, those big NFL team
parkas........all worn by kids who are on the free-lunch program.

Health care isn't the only factor in this world, and if you're under 35,
it's not even an important one.


Europe, Australia, Canada all
look to the welfare of their people. For the USA that's an
annoying side-issue inadequately dealt with. My Aussie
roommate was mostly out of work for two years when he
went back (he was only 19 or 20 when he went back). I
asked him about health care and he said "Oh, you don't
have to worry about that in Australia." He never sounded
as though he was in desperate straits during that time. In
America, anybody out of work that long without a stash of
money is going to be worried about being out on the
streets without food except for soup-kitchens, and god
help them if they get sick.

I don't remember ever seeing a person who looked like
he lived on the streets in Sydney, though I guess there
must be some. That made the street people even more
noticeable than before when I returned to the USA.

When it comes down to the lower 2% of wage earners (those that basically
don't earn) then you're right, the safety net in the other countries picks
them up.

JG



Third world nations have poorer poor people than
all the above, and the USA too, granted, but the USA
isn't supposed to be a third-world country, at least not
yet.




.

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