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A picture of a Shell Gas Station advertising gas for 33 cents per gallon in 1972 periodically appears on Facebook. It’s followed by a long list of people gushing about either how cheap it was then, or how expensive it is today. But using an online calculator, a dollar in 1972 is worth about $7.50 today, making the inflation adjusted price of that gas about $2.50 per gallon. Now comes the fact that I am only using a third of the gas today due to increased efficiency. So in my sometimes convoluted way of thinking, the combination of inflation and better mileage means todays price of gas would need to be approximately $7.50 per gallon to equal 1972’s 33 cent per gallon.
My dad grew up poor. He used to say he remembered when a loaf of bread was a nickel…. But he didn’t have a nickel.
Sometimes the good old days weren’t all that great.
Are there other examples of products that are either more or less expensive today based on inflation or the way we use them?
In the late 1970’s I spent around $500 for a VCR so I could record a show to watch later. Wow, what amazing technology. A couple months ago I paid $69 for a year of HBO. With all the streaming services out there I think, Wow what amazing technology!
Coincidentally my son just sent me the following reel. A bit off topic, but it’s showing formula 1 racing cars pit stops in 10 year jumps. They’re about 5 times faster now than 1990. Kinda cool: Pit Stop in 1990 vs 2023
Goods have gotten cheaper, services have exploded in cost.
Yes that’s true as well. Things like college tuition, health care services, long term care and etc. have certainly outpaced inflation.
I think my reaction to the Facebook post about the price of gas had a lot to do with how people don’t question things they see on such sites.
Great seats concerts 1970s $8
Taylor Swift 2024 $4000+
I saw Alice Cooper for $2.50 in 1971
We just bought a new top of the line Toyota Crown Cigna (potentially our last) with all the newest technology.
The MSRP is the same as what we paid for our first home in 1984.
Now I hope I can figure out how to take advantage of the technology.
Good luck with that Dave. I still haven’t figured out all the stuff on very run of the mill 2020 Equinox.
Dan, good post. I think what you are trying to do is compare the cost of transportation between 1972 and today. One way to compare the average cost is using the IRS standard mileage rate. today it is $0.67 per mile. I didn’t some Googling and I found that in 1972 form 2106 which indicated the rate was $0.12 That’s a ratio of 5.6 (0.67/0.12) which is less than the 7.5 you reference based on inflation data.
I’m currently watching Monday Night Football win a 65 inch LED smart TV. It cost less than half of what the 27 inch Sony TV, which weighed a ton, that our bridal party gave us as a wedding present in 1982. The quality isn’t close.
Inflation always must be taken into account when comparing today’s prices with those from many years ago. And, while for some items we are comparing apples to apples, this is certainly not true for such items as cars. Today, most have better performance and gas mileage, and are safer if involved in an accident.
Computers sure got cheaper. And smaller. And faster. In 1970 you needed a large room with a lot of AC, large peripherals (tape drives, disk drives, printers etc.), a number of acolytes (workers), and lots of money. The mainframe I programmed back then had 32K of memory. Remember when Bill Gates said no-one needed more than 640K?
Clothes seem to have become so cheap they’re disposable.
I remember the excitement when TI released the first commerical handheld calculator in 1972 (Datamath 2500) that was able to do the four basic arithmetic operations. The price was $149.99 which is $1,132 in today’s dollars.
I loved going to my father’s office in the 1970s and playing with the big, chunky, four-function calculator that sat on his desk. The calculator even had a small metal bar that was overlaid on top of the digital display, and which you could move across, so there were commas after every third digit, such as 2,432,819.
Watch the report on the PBS Newshour 11/18 about clothes being disposable. It’s frightening!
Kathy – don’t forget the modem that required a specially dedicated telephone line.
A raspberry pi Zero 2 W, available for $15, packs as much compute power as a 1960’s mainframe. As a computer geek I find that … amazing.
And thanks to advances in medical care I’m still around to be able to play with one.
Yes! I can remember getting my first iPhone in 2012 and being amazed that I was holding a computer in my hand. (This was my first cell phone, I was a late adapter. LOL!) Chris
I think the computation that you want to make is in 1972 the average car got 12 miles to the gallon, so if you inflated the price to $2.50 divided it by 12, it’s about 21cents per mile. Now we pay about $3 per gallon (averaging seasonal prices) but we get 30 miles to the gallon or 10 cents per mile.
That implies that it costs half as much per mile as it used to (which like real return rates, that’s the number you really care about, in the big picture)
Technology has changed so much. Who remembers turning on a TV or radio and waiting for the tubes to warm-up so the picture (or sound) was visible? This was true in your home AND in your car! There’s no cost or technology comparison for TV and radio/stereo availability compared to “the good old days”.