About
A 45-year inflation index built from real retail prices, the same household-spending weights BLS uses for the official Consumer Price Index, and a stubborn refusal to accept that the gap between official statistics and lived experience should remain unmeasured.
Reality Index began five years ago as a manual spreadsheet project. It exists today because artificial intelligence made the work tractable in a way it had not previously been.
In 2021, working with an assistant named Zina at Grabien, I began trying to manually compile a year-by-year retail price history of the items American families actually buy. The premise was simple: official inflation statistics were diverging from what people described as the actual cost of living, and there was no rigorous independent reference number to verify or contest the gap. ShadowStats existed, but on examination its method was not real-world price tracking — it was a multiplier applied to CPI based on differences between 1980s and post-1990s methodology. We wanted to track actual prices.
The project quickly hit a wall. Building a real reference inflation index from raw retail price data means assembling and reconciling thousands of data points across dozens of source agencies — BLS Average Price Data for food and energy, FHFA for housing, KFF for healthcare, EIA for gasoline, USDA for agricultural commodities, NCES for tuition, Freddie Mac for mortgage rates, AAA for vehicle costs, IRS for tax brackets, Census for income — and then transforming all of that into a coherent, normalized, time-series-aligned dataset that supports honest comparison to the official CPI. Each individual data pull was tractable. The aggregate scale of the work was not.
After many months of slow progress, the project was put on indefinite hold. The data existed in public sources. The methodology was clear in principle. The labor required to assemble it correctly was simply not available given everything else Grabien was doing.
Large-language-model AI changed what was possible. With AI assistance — specifically, working with Anthropic's Claude — the data assembly that had taken months of manual research could be completed in days. Not because the AI made any of the methodological choices for us (those are documented and defended on this site), but because it made the underlying work of pulling, parsing, normalizing, and reconciling data across dozens of public sources finally tractable for a small team.
The methodology decisions — which CPI subindexes to use as anchors, how to weight buckets, how to handle pre-1997 series gaps in communications, why FHFA-based housing carrying cost is preferable to BLS owner's equivalent rent, where to exclude direct taxes for apples-to-apples comparison with CPI — were all made by the project team. The retail prices come from BLS, EIA, KFF, FHFA, and other official sources. The AI did the assembly work that had previously been the bottleneck.
The result is what dormant projects look like when they finally ship: nothing fancy. Just the inflation rate Reality Index measures, the official inflation rate, both anchored to 1980 = 100, both using the same BLS Consumer Expenditure Survey weights, both visible on one chart. The gap is what families have been describing for years.
Reality Index is a research project of Grabien. It is not a partisan project, a political project, or a critique of the Bureau of Labor Statistics. CPI is a sophisticated statistical product that does exactly what it is designed to do. Reality Index is a complementary measure that takes a different methodological approach to a different question — what the basket of goods and services that defines middle-class American life actually costs, year by year, using real retail prices.
The project's editorial commitment is to be principled, not partisan. Where the data shows inflation has run faster than CPI reports (housing, healthcare), we say so. Where the data shows inflation has run slower than CPI reports (food at home, communications), we say that too. The American Dream Index found that the cost of a fixed 1980 lifestyle has fallen as a share of median household income, not risen — that finding does not flatter any political narrative, and we publish it anyway because it is what the data shows.
Reality Index will be wrong about specific things. The methodology choices are defensible but not the only defensible choices. The basket coverage is partial. The weights are anchored to a single year's BLS Consumer Expenditure Survey, which will need to be updated. Where critics make a fair case against a methodology choice, we will publish the change. The point of the project is to be a more honest reference number for what inflation has cost American families — not to be permanently right.
Tom Elliott
Founder & Editor · Reality Index
Tom is the founder and CEO of Grabien, a media intelligence service used by newsrooms, monitoring services, and analysts to track broadcast and digital media coverage. He is the former executive producer of The Laura Ingraham Show and The Peter Schiff Show. His journalism career includes stints on the editorial pages of the New York Sun and the New York Post.
Outside of Grabien, Tom is the founder of BioSpa, a wellness center in Madrid; Azoth.MD, a natural health platform; and the Constitutionality Index, a research project tracking constitutional questions in U.S. legislation. A forthcoming government accountability project will launch in 2026.
Tom can be reached for media inquiries at info@realityindex.co or on X at @tomselliott.
Zina, who spent many patient hours in 2021 assembling the manual spreadsheets that became the conceptual blueprint for this project. The basket categories and many of the source-agency mappings on this site trace back to her work.
Anthropic's Claude, which provided the AI assistance that made the data assembly tractable. Every methodology decision on this site was made by the project team; the AI's role was the assembly work that had previously been infeasible at human-only scale. We disclose this honestly because the project would not exist without it.
The economists and analysts who reviewed pre-launch drafts of the headline rate methodology and the American Dream Index basket specification, including Peter Schiff. Their critiques sharpened the project and identified methodology issues we revised before launch. Any remaining errors are ours.
The public source agencies whose work the Reality Index relies on entirely: the Bureau of Labor Statistics, the Energy Information Administration, the Federal Housing Finance Agency, the Kaiser Family Foundation, the U.S. Department of Agriculture, the National Center for Education Statistics, Freddie Mac, the American Automobile Association, the Internal Revenue Service, and the U.S. Census Bureau. Their data is the entire basis of this project. The methodology decisions are ours; the data is theirs.
Press inquiries, interviews, and media requests: see For journalists, analysts, and researchers for citation conventions, common workflows, and Tom's availability for radio, podcast, and television.
Methodology questions and basket-spec critiques: info@realityindex.co with subject line "Reality Index methodology."
Data corrections and challenges: info@realityindex.co with subject line "Reality Index correction." We respond within 48 hours and, where warranted, publish corrections directly on the affected page with a timestamped note.
Partnership and licensing inquiries: info@realityindex.co.