Beware of Core Rate Hypnosis: Pre-Clinton CPI Shows 7% Inflation (ETF: GLD)

I always tell subscribers that they must “accept

Comments

[Blaine]

David Fry falsely implies that the Clinton administration was responsible for the way inflation was re-calculated. It was factually Alan Greenspan and a grateful Republican Congress who created a shell game to slash $150 million form the Federal Deficit over five years. Greenspan suggested the change in 1995 as a way to trim cost of living adjustments to Social Security beneficiaries, other recipients of Federal benefit programs and retired Government workers.

According to the NY Times, “Mr. Greenspan's proposal was greeted enthusiastically by Republicans on Capitol Hill. He appeared to offer a way out of one of their biggest quandaries: how to cut spending on Federal entitlement programs without a specific vote that would clearly tamper with politically sacrosanct Social Security benefits. It would also allow Congress to increase tax revenues at a faster rate without requiring a political death wish: a vote to increase income taxes. …Indeed, House Speaker Newt Gingrich went so far as to threaten to withhold financing from the Bureau of Labor Statistics -- responsible for compiling the monthly consumer price report since 1919 -- unless it changed its approach. (NY Times, Feb. 22, 2008)

Truthfully, it was Speaker Gingrich and the 1990’s Republican Congress who are responsible. Even if Fry makes the meager argument that the President agreed to the changes proposed by Greenspan and the Congress, how is it that he cites Clinton, yet make no mention of Greenspan’s or the Republican Congress’s vast preponderance of responsibility? It should be more accurately called “The Gingrich/ Greenspan/ Republican Congress Rigging”. Those who would undertake journalism at the very least have an obligation for the accuracy instead of political bias.

2008 Feb 22 10:15 AM

[Blaine]

Sorry, the date on the NY Times article is February 22, 1995 by Kenneth N. Gilpin.

2008 Feb 22 11:27 AM