5 ms·

Presumably for the same reason you hear people say things like "How can inflation only be 2%? I am spending 10% more. We need to redefine inflation!" In other

by 9rx 2y ago

Presumably for the same reason you hear people say things like "How can inflation only be 2%? I am spending 10% more. We need to redefine inflation!" In other words, people want the data to speak to the government on their behalf so they don't have to. Musk is playing into that same idea.

mschuster91 2y ago
> Presumably for the same reason you hear people say things like "How can inflation only be 2%? I am spending 10% more. We need to redefine inflation!" The question if the goods basket that is used to define inflation actually reflects reality is valid though! For example, the explosion of rents in urban areas is offset by shockingly low rents in "flyover states" and rural areas, leading to a complete neglect of the problems of urban people because it simply doesn't show up in the statistics. For many poor people, they don't have the money to buy new clothes anyway, much less expensive goods such as new cars or luxury goods - and yet these products are all in goods baskets, offsetting the cost explosion in basic staples (and not just eggs). IMHO, "inflation" as a simple percentage metric is not a KPI that can be used - at the very least, socioeconomic strata and urban/rural differences need to be taken into account because over the last decades, thanks to rural flight the realities have separated way too hard. The problem that the Democrats faced in the last election campaign is that they only focused on KPIs useful for rich people: stock market indices, employment counts, GDP. But that mis-focus completely alienated the wide masses who felt they're being fed lies as their reality (exploding expenses but stagnant wages) was markedly different from what the Democrats pushed.
- 9rx 2y ago
  > The question if the goods basket that is used to define inflation actually reflects reality is valid though! Why? You're only trying to determine the change in value of the currency. What specific items are in the basket shouldn't matter all that much as long as it is a broad enough sample to be able to separate out the change in value of the goods from the change in value of the currency, along with it being comprised of things consumed frequently enough that you can see any change over a short period of time (e.g. monthly). > socioeconomic strata and urban/rural differences need to be taken into account Implying that an urban dollar isn't the same as a rural dollar? I mean, that is similar to what Musk is saying: That a government dollar isn't the same as a private dollar. But how do we quantify that? If we each throw down a $1 bill and shuffle them around, how can you tell which one represents an urban/government dollar and which represents a rural/private dollar?
  - mschuster91 2y ago
    > Implying that an urban dollar isn't the same as a rural dollar? The same dollar buys me a lot more food and accomodation in rural areas. To give you an example, average rent for 60 m² in Munich will easily run to 1200-1500€ a month, and that's net (so you got to add heating and utilities on top). In Eastern Germany, you can get 80 m² for 300€ a month. A trip to the grocery store is about 100€ in Munich, maybe 50-60€ in Eastern Germany, simply because the staff and rent cost of the grocery store are also much lower than in Munich. Unfortunately, collective wage agreements, UI benefits and pensions are federally the same across Germany - that means for example the train driver in Munich barely scrapes by because cost of living eats >50% of his paycheck while the train driver in Eastern Germany lives like a king.
    - deleted 2y ago
      [deleted]
    - 9rx 2y ago
      > The same dollar buys me a lot more food and accomodation in rural areas. That's because food and accommodations are often less valuable in rural areas. Supply and demand, as they say. But that is outside of the scope of inflation. As before, inflation seeks to measure the value of the currency itself, which also fluctuates in value just like everything else. > Unfortunately, collective wage agreements, UI benefits and pensions are federally the same across Germany Theoretically the value of the dollar could differ from place to place like food and houses – value is just arbitrary human opinion, after all – but as currency moves freely, everyone tends to agree on its value across entire countries (and usually the entire world). In practice, you'd also find accommodations and food settling on the same value across entire countries if we had magical portals that could move them to and fro on a whim like we can with currency. But it seems like what you are really thinking of is a cost of living index. Usually those are prepared on a regional basis for the reasons you have described. Inflation is decidedly not intended to be a cost of living index and there is no reason to turn it into a cost of living index. We already have that – not to mention that we also need to understand inflation. You may be also implying that some people use the wrong tool for the job (i.e. trying to use inflation as a cost of living index), but in that case the problem isn't that the tool broken, the problem is that the people are broken. The question then is not "What will it take to modify this screwdriver so that it is better at driving nails?" The question is "Why the fuck aren't you using a hammer?"
- Zigurd 2y ago
  two things about that: First, employers do take local cost of living into account to set pay, some implicitly due to competition, but many of them explicitly adjust wages based on cost of living data from economists. Secondly your complaint about the wrong KPIs rests in part on conflating cost of living with inflation. The problem the Democrats face is that wage prospects and social issues are segmented by level of education more than in the past. They should run on higher minimum wage, which will benefit rural workers more, and on making inclusive social views the key to social acceptance. Might be an unpopular opinion, but the Democrats won't get the sports betting crypto Joe Rogan incels anyway, so they might as well make the most stereotypical ones the symbol of how to keep you dick perma-dry.
  - 9rx 2y ago
    > The problem the Democrats face is that wage prospects and social issues are segmented by level of education more than in the past. But that's just because more people typically seek higher levels of educational attainment than in the past, so the more capable people filter upward. In my grandfather's day, even going to high school was relatively unusual. Back then, the "less than high school" cohort was a healthy mix ranging from those with extreme disabilities to high performing people. Nowadays, there are often even legal mandates that require anyone who is capable to graduate from high school. So, the "less than high school" cohort is now effectively only those with extreme disabilities, with all the life challenges that go along with that. As such, if you only glance at the data you might think that lower levels of education have fallen behind, but in reality they've just lost the people that helped make it look better than it really was for those who struggle. That doesn't seem like it should be a problem. Only the counting has changed, which isn't materially significant. I suppose what you are trying to say is that said shift has revealed how bad things have always been for the disabled, and Democrats are called upon to fix the issue making it their problem, whereas it is understood that the Republicans are always of the "fuck the disabled" mind so nobody expects them to deal with it?

by 9rx 2y ago

mschuster91 2y ago

> Presumably for the same reason you hear people say things like "How can inflation only be 2%? I am spending 10% more. We need to redefine inflation!" The question if the goods basket that is used to define inflation actually reflects reality is valid though! For example, the explosion of rents in urban areas is offset by shockingly low rents in "flyover states" and rural areas, leading to a complete neglect of the problems of urban people because it simply doesn't show up in the statistics. For many poor people, they don't have the money to buy new clothes anyway, much less expensive goods such as new cars or luxury goods - and yet these products are all in goods baskets, offsetting the cost explosion in basic staples (and not just eggs). IMHO, "inflation" as a simple percentage metric is not a KPI that can be used - at the very least, socioeconomic strata and urban/rural differences need to be taken into account because over the last decades, thanks to rural flight the realities have separated way too hard. The problem that the Democrats faced in the last election campaign is that they only focused on KPIs useful for rich people: stock market indices, employment counts, GDP. But that mis-focus completely alienated the wide masses who felt they're being fed lies as their reality (exploding expenses but stagnant wages) was markedly different from what the Democrats pushed.

9rx 2y ago
> The question if the goods basket that is used to define inflation actually reflects reality is valid though! Why? You're only trying to determine the change in value of the currency. What specific items are in the basket shouldn't matter all that much as long as it is a broad enough sample to be able to separate out the change in value of the goods from the change in value of the currency, along with it being comprised of things consumed frequently enough that you can see any change over a short period of time (e.g. monthly). > socioeconomic strata and urban/rural differences need to be taken into account Implying that an urban dollar isn't the same as a rural dollar? I mean, that is similar to what Musk is saying: That a government dollar isn't the same as a private dollar. But how do we quantify that? If we each throw down a $1 bill and shuffle them around, how can you tell which one represents an urban/government dollar and which represents a rural/private dollar?
- mschuster91 2y ago
  > Implying that an urban dollar isn't the same as a rural dollar? The same dollar buys me a lot more food and accomodation in rural areas. To give you an example, average rent for 60 m² in Munich will easily run to 1200-1500€ a month, and that's net (so you got to add heating and utilities on top). In Eastern Germany, you can get 80 m² for 300€ a month. A trip to the grocery store is about 100€ in Munich, maybe 50-60€ in Eastern Germany, simply because the staff and rent cost of the grocery store are also much lower than in Munich. Unfortunately, collective wage agreements, UI benefits and pensions are federally the same across Germany - that means for example the train driver in Munich barely scrapes by because cost of living eats >50% of his paycheck while the train driver in Eastern Germany lives like a king.
  - deleted 2y ago
    [deleted]
  - 9rx 2y ago
    > The same dollar buys me a lot more food and accomodation in rural areas. That's because food and accommodations are often less valuable in rural areas. Supply and demand, as they say. But that is outside of the scope of inflation. As before, inflation seeks to measure the value of the currency itself, which also fluctuates in value just like everything else. > Unfortunately, collective wage agreements, UI benefits and pensions are federally the same across Germany Theoretically the value of the dollar could differ from place to place like food and houses – value is just arbitrary human opinion, after all – but as currency moves freely, everyone tends to agree on its value across entire countries (and usually the entire world). In practice, you'd also find accommodations and food settling on the same value across entire countries if we had magical portals that could move them to and fro on a whim like we can with currency. But it seems like what you are really thinking of is a cost of living index. Usually those are prepared on a regional basis for the reasons you have described. Inflation is decidedly not intended to be a cost of living index and there is no reason to turn it into a cost of living index. We already have that – not to mention that we also need to understand inflation. You may be also implying that some people use the wrong tool for the job (i.e. trying to use inflation as a cost of living index), but in that case the problem isn't that the tool broken, the problem is that the people are broken. The question then is not "What will it take to modify this screwdriver so that it is better at driving nails?" The question is "Why the fuck aren't you using a hammer?"
Zigurd 2y ago
two things about that: First, employers do take local cost of living into account to set pay, some implicitly due to competition, but many of them explicitly adjust wages based on cost of living data from economists. Secondly your complaint about the wrong KPIs rests in part on conflating cost of living with inflation. The problem the Democrats face is that wage prospects and social issues are segmented by level of education more than in the past. They should run on higher minimum wage, which will benefit rural workers more, and on making inclusive social views the key to social acceptance. Might be an unpopular opinion, but the Democrats won't get the sports betting crypto Joe Rogan incels anyway, so they might as well make the most stereotypical ones the symbol of how to keep you dick perma-dry.
- 9rx 2y ago
  > The problem the Democrats face is that wage prospects and social issues are segmented by level of education more than in the past. But that's just because more people typically seek higher levels of educational attainment than in the past, so the more capable people filter upward. In my grandfather's day, even going to high school was relatively unusual. Back then, the "less than high school" cohort was a healthy mix ranging from those with extreme disabilities to high performing people. Nowadays, there are often even legal mandates that require anyone who is capable to graduate from high school. So, the "less than high school" cohort is now effectively only those with extreme disabilities, with all the life challenges that go along with that. As such, if you only glance at the data you might think that lower levels of education have fallen behind, but in reality they've just lost the people that helped make it look better than it really was for those who struggle. That doesn't seem like it should be a problem. Only the counting has changed, which isn't materially significant. I suppose what you are trying to say is that said shift has revealed how bad things have always been for the disabled, and Democrats are called upon to fix the issue making it their problem, whereas it is understood that the Republicans are always of the "fuck the disabled" mind so nobody expects them to deal with it?