Former National Economic Council Director Lawrence Summers is raising eyebrows with a new paper challenging conventional wisdom on the U.S. economy. Summers argues that Americans are right to be skeptical, as the official inflation rate does not paint the full picture. The exclusion of interest costs from the Consumer Price Index has led to an understatement of inflation, with a pre-1983-like formula showing rates as high as 18%. This discrepancy has significant implications for consumers who rely on credit for purchases, as well as for policymakers navigating the growing federal debt. The study calls for a reevaluation of how we measure inflation to ensure all voices are heard. (Word Count: 125)
https://www.forbes.com/sites/theapothecary/2024/03/23/summers-inflation-reached-18-in-2022-using-the-governments-previous-formula/