The Meme that the Government Understates Inflation is Hitting the Mainstream

Here it is, San Diego Union-Tribune, of all places.

Basically the bad numbers come from a number of factors:

• Bogus adjustments to inflation (I'll post on "Hedonics" later).
• Calling increases in prices asset appreciation (housing bubble).
• Ignoring the effects of increases in College tuition. They also ignore the fact that people have few working years as a result of inflating degree requirements for positions.
• Medical cost increases are understated in the cost of living.
• Over-weighting consumer electronics in the CPI.

Understated CPI numbers mask dropping living standards, and reduce increases in entitlements, and as such, they benefit governments, regardless of party.