Cartoon explaining weighted CPI

[BlueStreak]

56. The thing that is insidious about chained CPI is not the theory

In theory, it makes some sense that if beef is high and chicken is low (or vice versa), you can reasonably switch. But really, what other switches are realistic? If the cost of gas is high, you can't witch to rocket fuel. If the cost of diapers goes up, you can't really switch to McDonald's napkins. If the cost of cars goes up, it isn't reasonable to expect people to switch to bicycles. If the cost of apartment rent goes up, you can't go to a hotel room instead. If the cost of day care goes up, you can't drop you baby off at the dog kennel.

Other than the chicken/beef thing, I really can't think of any realistic substitutions that aren't, in fact, big downgrades.

And therein lies the problem. We can see where this is headed. Once they get the premise of substitution into law, they will start making DOWNGRADES, because that is really all that is available in most cases. And now, here's the big question.

HOW WILL YOU KNOW?

The regular CPI process is not very transparent, and the chained CPI thing is downright secretive. All you will see is a number.

CPI is a license to steal.