Changing the measure of inflation to generate more government revenuePosted: July 8, 2011
I read a short article in Planet Money that reminded me why I tend not to pay attention to official government inflation statistics. The government estimates it could generate $200B in extra revenues over a decade by making the switch. This reminds me that the folks generating the index essentially have a vested interest in the numbers themselves or at least can face political pressures to calculate and/or interpret them in ways favorable to policy.
See “The Wonky Inflation Tweak Worth Over $200 Billion” for more.