Talk about a low effort post, many of the numbers used to support the narrative didn’t keep up with inflation.
I can’t tell if this post was by the mathematically innumerate or just crafted for the innumerate. For example: “$238 billion, according to a recent Oxfam report, and their wealth increased by $8.8 billion between 2020 and 2022” 208 Billion in 2020 is worth ~238 billion in 2022, so they effectively down ~20 billion. Exact numbers depend on when in 2020 and 2022 their wealth was calculated, but it’s very clear they lost wealth.
Some of these numbers do support their argument but many directly contradict it.
I submitted this post, and so I suppose that would make me "mathematically innumerate" (which seems a bit like calling someone literately dyslexic.) I submitted it because I noticed that my grocery prices were vastly higher over the last year than the 10% quoted inflation would seem to predict and thought it would be interesting to see what this community thinks. Most of us are shielded from stuff like this, and so also I thought it would be useful to inject a little everyman perspective into our tech bubble :)
CPI is also a broken measure due to its inability to measure wealth inequality (sampling median purchasers only) and discretionary hedonic adjustments. Real inflation has likely been ~33% higher than reported for decades (the Big Mac index is probably the true gold standard).
And that's fine, because the CPI's job is to measure how prices have changed (ie. inflation), not wealth inequality. Just because a given metric doesn't support your pet cause doesn't mean it's "broken". It's like complaining GDP is a broken metric because it doesn't measure how oppressed minorities are.
> Real inflation has likely been ~33% higher than reported for decades (the Big Mac index is probably the true gold standard).
I tried to confirm this and the results were far from conclusive. The big mac index data can be obtained from github[1] and gives a 129.9% increase between april 2000 (earliest data available) and july 2022 (latest data available). To compare this against the CPI data, I checked on FRED and the "Consumer Price Index for All Urban Consumers: Food Away from Home in U.S. City Average"[2] component of the CPI gives a 87.0% for the same time period. If you take those numbers and convert them to annualized rates, you will indeed find a 33.3% difference between them. Looks like your claim is confirmed, right? But not so fast. The CPI category listed above actually breaks down into more detailed categories, including "Limited service meals and snacks", which presumably the big mac falls into. That data isn't available on FRED but can be found on BLS's data viewer[3] and gives you a 105.8% increase for the same time period. If you convert that to an annualized rate the difference between that and the big mac index drops to 15%. I suspect if we try harder we can eliminate more of the discrepancy. For instance, the "Limited service meals and snacks" index was probably computed from a basket of items, not just big macs. Items that have fatter margins (eg. fries or drinks) might have inflated slower than big macs, thereby dragging the growth of the basket down and explaining the difference.
[1] https://github.com/TheEconomist/big-mac-data/