Got standards? Apparently not at the BLS.
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06/16 10:47A (DJ) DJ US GAO Urges Review Of BLS Substitution Decisions In CPI
Story 2890 (G/CNG, N/DJN, N/DJWI, N/ECO, N/EMI, P/DEC, P/DWV, R/US, R/NME)
WASHINGTON (Dow Jones)--A new report found "no evidence" to indicate whether
errors or inconsistencies in decisions by Bureau of Labor Statistics commodity
analysts or the lack of comprehensive review of those decisions has had a
material effect on the calculation of the Consumer Price Index.
The General Accounting Office said in the report that "we are not suggesting
that the CPI is inaccurate." But GAO also said prior BLS studies "have noted
that the decision-making process was susceptible to producing errors and
inconsistencies," and said this has not been remedied by sustained corrective
action.
"To help ensure that the CPI is protected from potential effects of errors
and/or inconsistencies resulting from commodity analysts' substitution
decision-making, we recommend that the Commissioner of BLS evaluate, on a
periodic basis, the degree of consistency and accuracy in analysts'
substitution determinations and the resulting effects on the CPI," said GAO, a
Congressional watchdog agency.
In the process of computing the CPI every month, BLS commodity analysts
review the substitutions that price takers make each month for items they
can't find. GAO said substitutions "are not inconsequential because BLS has
determined that they can have a significant impact on CPI."
GAO said that "by the very nature of the differences that can exist between
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