4 ms·

People often talk past each other about inflation because many people are concerned solely with the rising costs of the things they need to live, in real terms.

People often talk past each other about inflation because many people are concerned solely with the rising costs of the things they need to live, in real terms. Housing, food, healthcare, education, transportation, insurance. It is trivial to look up the real dollar costs of what these things cost decades ago, and what they cost now. It is also very trivial to look up what wages were, in real dollars, and compare the rates of increase between costs and wages. In every category of the things that people actually need to survive, real inflation is massively, massively higher than wage growth. It is obvious nonsense to insist inflation was only 6.4% last year when the people you're trying to convince are well aware of that their grocery bill is 50% higher, their health insurance premiums have doubled, rent has substantively increased and they still owe $60,000 in college debt on tuition that people with part time jobs were paying for a few decades ago. BLS can talk about how the roll of toilet paper that costs $2 this year instead of $1 last year is actually "cheaper" because the value is better due to their hedonic adjustment, but at the end of the day I'm paying twice as much for tp.

WalterBright 4y ago
> trivial to look up what wages were Which gives a very misleading figure. The useful figure is "total employee compensation" which includes the value of benefits such as vacation, sick days, health insurance, 401k contributions, etc. All of this can add another 40% to the wages.
- StanislavPetrov 4y ago
  >The useful figure is "total employee compensation" which includes the value of benefits such as vacation, sick days, health insurance, 401k contributions, etc. All of this can add another 40% to the wages. No, actually that figure is not useful at all, and is one of the primary tools used by BLS and others to obfuscate and mislead about actual wages. Your employer and BLS may "value" your health insurance at $10,000 a year compensation. However, if you have a $5,000 deductible and cannot afford to pay for medical care out of pocket that "compensation" is worthless to you. Food costs actual dollars. Rent cost actual dollars. Gas costs actual dollars. The only thing that matters is the dollars you actually take in to pay for these things you need to survive, not some imaginary compensation number the government or your employer declares your actually salary was. When your rent in actual dollars, and the cost of food doubles in actual dollars, and the price of gas triples in actual dollars, nothing matters less than the BLS declaration that your compensation went up $10,000 because the health insurance your job offers you (that you can't afford to use because of the massive deductible) is now worth $20,000 instead of the $10,000 they said it was worth last year.
gruez 4y ago
>People often talk past each other about inflation because many people are concerned solely with the rising costs of the things they need to live, in real terms. Housing, food, healthcare, education, transportation, insurance. The categories you listed adds up to almost 3/4 of the total CPI basket. > It is trivial to look up the real dollar costs of what these things cost decades ago, and what they cost now. It is also very trivial to look up what wages were, in real dollars, and compare the rates of increase between costs and wages. It's evidently not trivial, otherwise anyone with a spreadsheet would have been able to debunk BLS's stats in a matter of hours. Instead, the state of the art when it comes to inflation skepticism seems to be "add an arbitrary number to BLS's inflation number, and don't bother justifying anything". > BLS can talk about how the roll of toilet paper that costs $2 this year instead of $1 last year is actually "cheaper" because the value is better due to their hedonic adjustment, but at the end of the day I'm paying twice as much for tp. Only certain categories are subject to hedonic adjustments, and toilet paper isn't one of them[2]. [1] https://en.wikipedia.org/wiki/Shadowstats.com https://en.wikipedia.org/wiki/Shadowstats.com [2] https://www.bls.gov/cpi/quality-adjustment/ https://www.bls.gov/cpi/quality-adjustment/

WalterBright 4y ago

> trivial to look up what wages were Which gives a very misleading figure. The useful figure is "total employee compensation" which includes the value of benefits such as vacation, sick days, health insurance, 401k contributions, etc. All of this can add another 40% to the wages.

StanislavPetrov 4y ago
>The useful figure is "total employee compensation" which includes the value of benefits such as vacation, sick days, health insurance, 401k contributions, etc. All of this can add another 40% to the wages. No, actually that figure is not useful at all, and is one of the primary tools used by BLS and others to obfuscate and mislead about actual wages. Your employer and BLS may "value" your health insurance at $10,000 a year compensation. However, if you have a $5,000 deductible and cannot afford to pay for medical care out of pocket that "compensation" is worthless to you. Food costs actual dollars. Rent cost actual dollars. Gas costs actual dollars. The only thing that matters is the dollars you actually take in to pay for these things you need to survive, not some imaginary compensation number the government or your employer declares your actually salary was. When your rent in actual dollars, and the cost of food doubles in actual dollars, and the price of gas triples in actual dollars, nothing matters less than the BLS declaration that your compensation went up $10,000 because the health insurance your job offers you (that you can't afford to use because of the massive deductible) is now worth $20,000 instead of the $10,000 they said it was worth last year.

gruez 4y ago

>People often talk past each other about inflation because many people are concerned solely with the rising costs of the things they need to live, in real terms. Housing, food, healthcare, education, transportation, insurance. The categories you listed adds up to almost 3/4 of the total CPI basket. > It is trivial to look up the real dollar costs of what these things cost decades ago, and what they cost now. It is also very trivial to look up what wages were, in real dollars, and compare the rates of increase between costs and wages. It's evidently not trivial, otherwise anyone with a spreadsheet would have been able to debunk BLS's stats in a matter of hours. Instead, the state of the art when it comes to inflation skepticism seems to be "add an arbitrary number to BLS's inflation number, and don't bother justifying anything". > BLS can talk about how the roll of toilet paper that costs $2 this year instead of $1 last year is actually "cheaper" because the value is better due to their hedonic adjustment, but at the end of the day I'm paying twice as much for tp. Only certain categories are subject to hedonic adjustments, and toilet paper isn't one of them[2]. [1] https://en.wikipedia.org/wiki/Shadowstats.com https://en.wikipedia.org/wiki/Shadowstats.com [2] https://www.bls.gov/cpi/quality-adjustment/ https://www.bls.gov/cpi/quality-adjustment/