Ex-US Comptroller Says Time to Retire CPI Inflation Metric

For decades, the Consumer Price Index (CPI) has measured the cost of living in America.

However, this figure doesn’t tell the full story about inflation, former U.S. Comptroller of the Currency Gene Ludwig argued in an interview with Bloomberg News Monday (Sept. 22).

“The CPI is not tremendously relevant to the lived experience of middle- and low-income Americans who don’t buy 80,000 goods and services,” said Ludwig, who was comptroller from 1993 to 1998 and founder of the Ludwig Institute for Shared Economic Prosperity (LISEP).

Per the Bloomberg report, he is also the author of a forthcoming book, “The Mismeasurement of America: How Outdated Government Statistics Mask the Economic Struggle of Everyday Americans.”

“If we’re going to have a number that is relevant to them, it’s got to be a smaller group of items that matter to their lives,” Ludwig added.

According to the report, Ludwig and LISEP have developed an alternate measure they call the True Living Cost.

The TLC looks solely at a household’s minimal needs, things like groceries, housing, medical and child care, and transportation. Since 2001, the report said, this index has increased 1.3 times faster than the CPI.

Ludwig said this disconnect between how inflation affects Americans and government statistics could be seen during the last presidential election. Grocery prices for things like eggs were on voters’ minds, even as President Joe Biden’s administration insisted the cost-of-living crisis was fading.

Nearly a year after the 2024 election, there are still a number of signs American households are feeling stressed.

For example, the August 2025 Survey of Consumer Expectations from the New York Fed shows that the volatility seen in recent weeks in the labor market, and the continued volatility surrounding tariffs, is impacting how people see their current and future situations.

Assessments deteriorated across most metrics, with median short-term inflation expectations creeping up 0.1 percentage point to 3.1%, while three-year expectations remained unchanged at 3.0% and long-term expectations increased 0.3 percentage point to 2.9%.

Meanwhile, research by PYMNTS Intelligence shows that almost 1 out of every 4 households routinely struggle to stay on top of monthly bills, while half have little or no savings buffer to cushion against rising costs.

“Importantly, this financial fragility is not limited to low-income groups. Over one-third of adjustable-rate mortgage (ARM) borrowers making more than $100,000 report living paycheck to paycheck, underscoring that high earnings no longer guarantee stability,” PYMNTS wrote last week. “Across the board, households are making tough choices: deferring large purchases, cutting discretionary spending, and using BNPL or credit cards to manage cash flow.”