Q & A
Does the CPI used for calculating Social Security COLAs take into account package shrinkage?
Full Question: When the federal government calculates inflation in the cost-of living adjustment for various programs, such as Social Security and the consumer price index, do the number crunchers adjust for product “downsizing” without a price increase? Prices have not decreased correspondingly. In my book, that’s inflation by any other name.
Answer: That’s inflation in our book, too, and we’ve warned consumers about the incredible shrinking package and measured how manufacturers have sneakily reduced the size of everything from orange juice to dishwashing liquid by 8 to 20 percent, while keeping the price the same. Packaging pros play shortchange by sleight-of-hand because consumers are more attuned to changes in price but not so much to changes in package weight or volume. Read more…
Source: Jeff Blyskal, Fox Business - May 17, 2014
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