I’m not sure what it brings to the debate (see PolitiFact Wisconsin, WisconsinWatch).
The JEC-Republicans State Inflation Tracker :
quantifies the inflation costs that American households are facing in the high inflationary environment that began in early 2021. We define monthly inflation costs as the additional expenditures in a given month required for a household to attain the same standard of living it achieved in the baseline month, January 2021.
When I first was apprised of this resource, I thought “Great! – Somebody’s gone through the trouble to figure out a state-specific inflation rate”. Once one reads through the documentation, one sees that the resulting calculations yield a combination of family-size and inflation effects, where “family size” has to be imputed from a subregional level basis, and prices have to be imputed from a subregional basis. In point of fact, the the resulting index is not Wisconsin-specific.
Here’s the algorithm as described by JEC-Republicans:
Estimating inflation costs for the average household in each state consists of three main steps: (1) estimating average monthly household spending by state, (2) approximating inflation rates by state, each relative to January 2021, and (3) applying the inflation rates to monthly household spending to estimate state-level inflation costs. For each state, we estimate overall monthly household inflation costs as well as inflation costs within four spending categories: food, shelter, transportation, and energy.
The main problem I see is that, in an effort to calculate a “household cost”, they have to translate from BLS consumer expenditure and PCE expenditures, and consumer units to households. Ratios are by Census region. CPIs are by BLS regions. Some of these translations could be avoided had they simply gone on a per capita basis, and used BLS weights. For Wisconsin, the “inflation cost for ‘household'” matches pretty closely the CPI by March 2024, keeping in mind the purported Wisconsin index is not really for Wisconsin. (As far as I can tell, they are using 2019 enumeration of consumer units.)
Figure 1: East North Central CPI, n.s.a. (black), JEC-Republican estimated Wisconsin inflation cost per consumer unit (red), both in logs 2021M01=0. Source: BLS, JEC-Republicans, and author’s calculations.
In my opinion, it would’ve been simpler to just take the BLS subregional CPI series, and multiplied by household size. Note, adjusting CPI expenditures to PCE expenditure weights pushes up the dollar amount per household, relative to using BLS CPI, which might have been the objective.
In the methodology notes, JEC-Rep did not directly provide expenditures for subcategories food, housing, transport, so I could not compare their measure of household costs of inflation to the BLS subregional inflation index.
This measure reminds me of the high quality spin aka Bruce Hall
high quality spin. I must have missed that
This spin has Bruce Hall fingerprints all over it
Bit of a kludge. The goal is pretty clearly to provide an excuse to keep attention focused on inflation, and to “identify” cases to complain about.
Among the reddest states are three swing states and a state with a Democratic Senator up for re-election in a Republican state. I would be curious to know whether some more straight-forward approach would have given Republicans less to squawk about in key states.
In general, the reddest states are Red States. Perhaps a change of state government is in order.
The Wisconsin Watch made two key points:
‘The analysis is by Republican members of Congress’ Joint Economic Committee. It refers to households, not people, in saying that people in Wisconsin needed an estimated $10,131 more per year to afford the same standard of living in October 2023 that they had in January 2021. University of Wisconsin-Madison economist Menzie Chinn told Wisconsin Watch that based on the analysis, the figure is $6,414 per person.’
Yes income per capita is the right metric but I bet Bruce Hall kept telling his fellow MAGA liars that since he refuses to do income per capita for places like China, it’s OK do that the same here. Think of it this way – if a family had a new child over the same period, the extra costs would run near $4000 a year. Yea I get Brucie Boy has no idea what that means since God had the wisdom a long time ago that the world did not need another Brucie boy.
“An analysis by Democratic members of the same committee found that average wages and salaries are up $14,970 during the same period.”
Real income in other words is higher (something that has eluded little Brucie Boy for a long time) so much that a family could actually afford two more children. Let’s just hope they send their kids to better schools than Brucie Boy attended.
Talking change in outlay (cost) without looking at change in income is a major and intentional flaw. It removes stagnation in wages from the debate, which the rick GOP donors like a lot. Real cost and real income is what should be talked about. I think we need to normalize cost to increases in incomes.
I think it was Kevin Drum who calculated how many eggs one could buy with an hour of work. Now that was breakfast but now I’m watching the NBA playoffs. So how many beers can I buy with an hour of work?!
‘Inflation is emerging as one of Republicans’ top lines of attack against Democratic President Joe Biden, who is running for a second term. Consumer inflation has been cooling down since a 9.1% peak in mid-2022. In January, prices were up 3.1% compared with a year ago, still above the Federal Reserve’s 2% target. But even as the economy has improved, Republicans are tapping into lingering unease among voters. That includes U.S. Rep. Bryan Steil, who represents southeastern Wisconsin.’
The fact is that real incomes have risen as nominal income has increased more than the price level. This is not a liberal or a conservative claim. It is a fact.
What these MAGA Republicans are doing is called “money illusion” in economics. And if you Google to find out who condemns money illusion it is conservative economics who unlike these MAGA types are both smart and honest.
Yea – the MAGA crowd might as well say “vote for us as you as dumb as a rock:. MAGA
I wonder whether the household spending estimate includes debt service. Debt service as a share of personal income is down:
https://fred.stlouisfed.org/graph/?g=1kzzE
Leave that out and you miss an important component of household costs. I also wonder what would happen to average living costs if every state had adopted expanded Medicaid coverage. We have recently been treated to speculation about the relative impact of inflation on poorer households, without any attention to a cost reduction that would be available to – anyone know how many? – households if politicians in Republican-governed states would simply agree to allow policies that benefit their poorer constituents.
“Right-to-work” (sic) laws kept wages down. Inflation is easier to live with if one’s wages aren’t intentionally suppressed.
Knowing how the baloney is sliced is important when evaluating baloney.
For those seeking high-minded entertainment, there is action in four separate Trump court cases this week.
Opening statements in the Stormy case and maybe some testimony, a decision on the validity of Trump’s $175 million bond, a Supreme Court decision that Trump is not immune from prosecution and a ruling on Trump’s violation of a court order.
Have I missed anything? Oh yes! Ukraine gets additional U.S. assistance without Trump getting Hunter Biden’s laptop. (Did Hunter even have a laptop?)
I’m giddy with anticipation.
There is a bit of a switch in recent polls which include Robert Kennedy. Previously, Kennedy seemed to pull more votes away from Biden, but a new poll show Kennedy shifting the race from a slight advantage for Trump to a slight advantage for Biden:
https://thehill.com/homenews/campaign/4610416-rfk-jr-hurts-trumps-election-chances-more-than-biden-poll/
That is consistent with the changing pattern in 270-to-win’s polls-only electoral vote estimates. Biden and Trump are now pretty evenly matched, because a handfull of states have gone from likely Trump to undecided. Looks like support for Trump is weakening, while support for Biden is just holding steady, in the 270 polling estimates and in the shift of votes to Kennedy from Trump. Looks like “Trump the criminal loser” is gaining ground.
This all remains in a cocked hat, of course, because: It’s too soon for polls to be predictive; Electoral votes, not the popular vote, decide the presidential race, and; polls are loosing their reliability.
So never mind.
This reminds me of the WI GOP spending $2 million of WI taxpayer money to find – election fraud – https://www.wpr.org/politics/wisconsin-price-tag-michael-gableman-probe-nearing-2-million-report-finds – by the way – there was no election fraud – some folks in long term care were assisted to vote – which is legal under the Americans with Disabilities (ADA) act – accessibility vote act – (The WI GOP didn’t even bother to issue a report.)
Of course – that didn’t stop the WI GOP from pushing through a vaguely worded amendment to state constitution – saying people can not have a volunteer to help them vote – (see Question 2 – https://statedemocracy.law.wisc.edu/explainers/2024/explainer-proposed-wisconsin-constitutional-amendments-on-election-administration/ ) (Clearly – a violation of the ADA.)
The WI GOP do not want people to vote – and they will use all the tools they can to suppress or eliminate your vote – gerrymandering, voter ID laws, de-funding election clerks in blue areas, violating the ADA voting act –
People of Wisconsin – please vote for Dems – so we can ensure a woman’s choice in private healthcare issues, properly fund our schools, enshrine voter accessibility, and legalize marijuana use (so our tax $ doesn’t go to Illinois). Let’s move Wisconsin forward!
BTW – Menzie – since I work with individuals with disabilities in Wisconsin and encounter the caregiver crisis on a daily basis (Wisconsin population is aging and growing slowly) – I found this article via the Brookings Institute on “How immigration reforms could bolster Social Security and Medicare solvency and address direct care workforce issues” https://www.brookings.edu/articles/how-immigration-reforms-could-bolster-social-security-and-medicare-solvency-and-address-direct-care-workforce-issues/ very helpful.
It would be very helpful if the WI GOP would be more welcoming to immigrants.