Much like Nixon’s self-delusion of the 1970s, it gives our leaders a gimmick to help them ignore reality and make believe they’re actually doing something useful. They keep telling you to focus your mind on the “core inflation rate,” excluding food and energy. If you do, they insist, the inflation magically disappears. – MoneyandMarkets.com
Kevin Phillips, a political and economic commentator for more than three decades and onetime Nixon strategist, reports that President Richard Nixon asked his Federal Reserve chairman, Arthur Burns, to concoct a new inflation number that would be split off from traditional headline CPI, dubbed “core” inflation—and thus make inflation look less threatening. – EconomicPolicyJournal.com
Manipulated numbers notwithstanding, high inflation would outlast the Nixon years, and by the end of the 1970s, futzing with the figures that measure it had become common. Prices of everything from used cars to children’s clothing were given the heave in order to make the numbers look better. As control of the White House shifted from Republicans to Democrats and back, both parties needed to avoid giving the impression that inflation was actually worse than it had been when the other guys were in power. – Newsweek
The references go on and on from the Huffington Post to Sean Hannity and every nut and mainstreamer in between – except Krugman, of course.
