The measure is called real dollar terms. Using the current value of the dollar and applying it to the past, one author says that we paid more of our income in the past for gasoline than today.
Factoring Inflation Offers a Different Picture
I remember an interview a young reporter did in 1998. I was working my first few months as a TV news director, and the price of a gallon of gasoline was just under a dollar a gallon. . The Asian economy was in recession and demand for oil had collapsed. Eliot, the reporter, spoke to an economist. The professor explained in real dollars that the price per gallon was the cheapest in 70 years. Basically, in 1998 gasoline was the cheapest it ever was.
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The story details how much personal income went into gas tanks. At a time when most cars and trucks also had very low mileage ratings. I believe this story is supposed to make us feel better about paying 60% more for a gallon than a year ago, though.
Modern families spend more on gadgets
When my dad was making $8,000 a year and gas was listed at 40 cents a gallon, we had no other living expenses. We didn’t have a cable TV and internet package that some families now cost $150 a month. We had a landline. The charge was only a few dollars a month. There was an additional cost on long distance calls. We rarely spoke with anyone on the phone outside of town. We sent more letters when we needed to communicate.
Yes, gasoline may have been more expensive in real dollars in the past, but if you have 5 smartphones in the family in addition to other modern expenses, you may not be better off than your 1960 ancestors. !