Obama - Lesson 1: Cost of Living

Barack Merkel - Angela Merkel's Cousin?

It's the Economy Stupid!

Why is it lately that every time Obama speaks about the economy he talks only about deflated "jobs figures" (unemployment)? Obama says it stands at 8.5%, but this only counts people that are actively looking for jobs. It is understood to be actually over 18% after counting the number of unemployed and add the people who have stopped looking for new jobs, those employed part time and want full time, and those who looked for a job at least once in the last year but are not working, now that's real "unemployment".

He really doesn't like to mention to voters the ever increasing housing, groceries, gasoline, heating oil, electricity, water or clothing prices in the Cost Of Living equation either.  They are all over the map and really screwed up.

Washington politicians and bureaucrats are not willing to admit government regulations and oversight are killing our economy. Obama just keeps spending and piling on more oversight departments to "look out for the folks".  Just who are "the folks"? They are FCC, DOE, HHS, USDA, ED, DOI, EPA, DOJ, HUD, DOL, ad infinitum. When does Obama ever figure out that "the real folks" just may not want all of these or leastwise some of their bloated bureaucratic sizes reduced down from intrusive, burdensome, expensive federal departments and agencies? 

The SEIU union organization certainly does not, it is where their core constituency works and pays dues, albeit, not all those folks timely pay their federal income taxes. Federal workers owe more than $3 billion in income taxes they failed to pay in 2008. According to Internal Revenue Service documents, 276,300 federal employees and retirees owe $3,042,200,000.

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CPI Background Information - John Williams, Economist

http://www.shadowstats.com/article/consumer_price_index

In the early 1990s, press reports began surfacing as to how the CPI really was significantly overstating inflation. If only the CPI inflation rate could be reduced, it was argued, then entitlements, such as social security, would not increase as much each year, and that would help to bring the budget deficit under control. Behind this movement were financial luminaries Michael Boskin, then chief economist to the first Bush Administration, and Alan Greenspan, Chairman of the Board of Governors of the Federal Reserve System.

Although the ensuing political furor killed consideration of Congressionally mandated changes in the CPI, the BLS quietly stepped forward and began changing the system, anyway, early in the Clinton Administration.

Up until the Boskin/Greenspan agendum surfaced, the CPI was measured using the costs of a fixed basket of goods, a fairly simple and straightforward concept. The identical basket of goods would be priced at prevailing market costs for each period, and the period-to-period change in the cost of that market basket represented the rate of inflation in terms of maintaining a constant standard of living.

The Boskin/Greenspan argument was that when steak got too expensive, the consumer would substitute hamburger for the steak, and that the inflation measure should reflect the costs tied to buying hamburger versus steak, instead of steak versus steak. Of course, replacing hamburger for steak in the calculations would reduce the inflation rate, but it represented the rate of inflation in terms of maintaining a declining standard of living. Cost of living was being replaced by the cost of survival. The old system told you how much you had to increase your income in order to keep buying steak. The new system promised you hamburger, and then dog food, perhaps, after that.