How trustworthy are measurements taken with a rubber yardstick? Considerably less than completely reliable, of course.

That's why Vice President Al Gore, the man in charge of the Clinton administration's much-heralded effort at "reinventing" government, should deliver a couple of pointed messages to different parts of the federal establishment.The U.S. Bureau of Labor Statistics should be told to stop dragging its feet and come up with a more accurate yardstick for measuring inflation. The present consumer price index just won't do.

Until the accuracy of the consumer price index is improved, Congress should be told to back off from granting automatic cost of living increases under various federal programs based on the rate of inflation.

Only this week the bureau admitted that this year the CPI overstates the inflation rate by more than one-fourth. This gross error results because the index focuses on the prices of a fixed "market basket" of products, ignoring the fact that consumers switch to other products when one or more components of the basket become more expensive.

That's not the only problem with the CPI, which has long been criticized for failing to adequately measure the rising cost of insurance. That goes particularly for health insurance, a budget item that often rises so steeply as to make other price increases seem insignificant.

Despite these problems, the bureau is in no hurry to overhaul the CPI, admitting that any changes are several years away at best.

Meanwhile, the flawed CPI continues to distort both the public and private sectors of the economy. That's because reported inflation rates have a major impact on the level of interest rates and are used to determine annual increases in various government programs such as Social Security payments, wages in many labor contracts, some office building leases and even some alimony payments.

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One reason the bureau isn't moving fast to improve this particularly economic yardstick is that it fears the political backlash that's likely to result when Social Security recipients start getting smaller annual cost-of-living adjustments.

Another part of the problem is that Congress has been stinting on the Bureau of Labor Statistics and other federal agencies assigned to measure the performance of the economy.

Requiring them to monitor an increasingly complex economy with less personnel and outmoded yardsticks is clearly an exercise in false economy. The remedy for this aspect of the problem is the obvious recourse to more money and manpower. The hardest part is supplying timid bureaucrats with stiffer spines.

The lesson for Gore and others trying to "reinvent" the federal establishment should be clear: Better government requires more than just better policies and procedures. It will take better public servants, too.

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