True Rate of Inflation ‘Much Higher’ Than Official Government Figures Show: Expert
While the White House took a victory lap on Wednesday’s declining inflation print, some experts say the true rate of inflation in the United States is much higher than the officially-reported data indicates.
The Bureau of Labor Statistics (BLS) reported on Aug. 10 that the headline pace of inflation, as reflected in the Consumer Price Index (CPI), ticked down from a 41-year high of 9.1 percent in June to 8.5 percent in July.
At the same time, the month-over-month CPI inflation figure came in at 0 percent—meaning the pace of price growth stayed flat between June and July—prompting President Joe Biden to take a victory lap saying that the “economy had zero percent inflation in the month of July.”
Some analysts and Biden’s political opponents objected to the White House messaging on “zero” inflation by arguing that the president was cherry-picking the data by focusing on the month-over-month pace of growth while overlooking that the year-over-year rate of inflation—the established method for measuring inflation—remained a historically elevated 8.5 percent.
Further, some analysts say that the officially reported figures understate the true pace of inflation, citing factors like a lag in housing costs being reflected in the government’s CPI inflation gauge.
Former President Donald Trump also recently argued that the pace of price growth in America was “much, much higher” than official data suggests and telling rally-goers in Arizona that inflation is “going higher and higher all the time.”
“It’s costing families nearly $6,000 a year, bigger than any tax increase ever proposed,” Trump said at the July 22 rally.
Former President Donald Trump attends a rally in support of Arizona GOP candidates, in Prescott Valley, Ariz., on July 22, 2022. (Mario Tama/Getty Images) Alternative Inflation Measures
An alternative CPI inflation gauge developed by economist John Williams, calculated according to the same
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