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Subject:  Re: Lies, damn lies and CPI Date:  3/25/2013  8:21 AM
Author:  VUCommodore Number:  14026 of 19993

"I don't doubt that the government manipulates inflation data for their own benefit."

(1) The most benefit the government can possibly get out of inflation data is real information so that they can have a better chance of making monetary and fiscal policy decisions as well as possible. Their incentive is to provide themselves with accurate data.

(2) It would be a herculean task to manipulate inflation data. Either you have to deal in unjustifiable assumptions (which is tough when dealing with the most heavily scruitinized economic data in the world), or you have to literally rig the inputs to arrive at your desired result, which would require coordination between literally hundreds of BLS employees, none of whom have ever come forward to suggest that such a thing has ever happened, and many of whom in my experience suggest that such a thing is very close to impossible given all the independent checks on data quality.
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