http://www.freemoneyfinance.com/2008/07/inflation-part.html
Officially, inflation today is calculated about 4%. Unofficially, it
is over 7%. Since 1997 the government Consumer Price Index (CPI) has
manipulated the raw data and significantly underreported inflation.
Recently I watched the 1997 movie "Conspiracy Theory" starring Mel
Gibson and Julia Roberts. Before the opening credits have finished
rolling, we understand that Gibson's character is a crackpot cab driver
who sees conspiracies everywhere. But our perception changes by the end
of the film when we realize for ourselves that some of his theories are
true.
For years I've hesitated writing about the CPI, computed by the
Bureau of Labor Statistics, for fear of being compared with a paranoid
character like the one in "Conspiracy Theory." The message that the
government lies to us about inflation and, as a result, quietly
confiscates hundreds of billions of dollars from its citizens isn't the
easiest message to swallow. It only goes down when accompanied by a
healthy draught of political cynicism.
What's changed over the past year, however, is that we are closer to
the end of the movie. It is clearer now not only that inflation is
running rampant but also that the government's numbers are still
ridiculously low. More Americans have come to mistrust official
inflation statistics, and therefore they are ready to understand how
and why the government skews these numbers and to learn how they can
protect their family's savings.
Take 2007 as an example. Bread price rose 7.4%, gasoline 8.2%,
health insurance 10.1%, whole milk 13.1%, eggs 29.2%, but according to
the CPI, somehow inflation was only calculated as 4.1%. This year to
date we have seen an even shaper rise, which still has barely affected
the official numbers.
In 1975 programs such as government pensions, Medicare a
Sure is a lot of truth in this article.
There is also a link to the original writer,click the link,then look under the politics tab for part II.
Ray
