We have
had deflation for about 15 years. The magnitude of this decline in the
cost of living has been covered up by several elements in our Cost of
Living indicators.
What has declined significantly? Everything we buy at Costco, Walmart and Home Depot. These three stores have set a pattern in place for better inventory management and significantly lower costs. That is why these stores are so successful. They have also set the pricing standard for many other retailers.
I don't know how much of the
market basket of objects that the Department of Commerce uses to
measure CPI comes from these three stores but it is a significant
factor in the lives of Americans. I also have no idea how much of the
items that CPI measures are measured in these stores, but if the number
of items is appropriate, our CPI in most areas has gone down. Really
down.
The items that have gone up
significantly in the past 15 years are higher education, housing
(particularly construction costs) and healthcare. The reason is
simple. 
These are domestic items, in fields with zero productive improvement.
Right now, we have inflation in many items for one reason: we are shipping our dollars to the oil producers in the middle east and Russia. We cheat these suppliers by giving them less and less valuable dollars. We are also lifting several billion people in Asia out of poverty by buying the exports of their nations. The consequence is that we are, to some extent, competing with the poor of the world for resources and the resource extracting industries are slow to meet market demands