THE COST OF LIVING: The Index Is Misleading & Incomplete

THE COST OF LIVING

ONE of the most frequently cited U.S. economic statistics is the Consumer Price Index, commonly (and erroneously) referred to as the cost-of-living index. Some 4,000,000 workers have their wage rates tied directly to the index, and the wages of the other 17 million in manufacturing and transportation are indirectly affected by the competition for manpower. Says Ewan Clague, commissioner of the U.S. Bureau of Labor Statistics, which prepares the index: "A single point increase can run up wages in the U.S. by $160 million. So much money changes hands...

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