Twenty Years ago, in 1994, I loved McDonalds. According to the noted burger experts at St. Louis Federal Reserve (see p. 10), a Big Mac cost $2.30. In 2013, a Big Mac will cost you about $4.56. Had the price risen by the same amount as official inflation, the price would have been about $3.50.
Thirty years ago, in 1984, the Radio Shack Catalog listed the Realistic MC-600 speaker set at $39.95. Today, you can get the same speakers with “some scratches or nicks” on eBay for $44. It doesn’t beat inflation, but that’s not too bad for consumer electronics.
The TRS-80 computer, featuring 16KB of memory and a “High-Resolution” monitor capable of displaying 16 lines of text, cost $999. That’s about $2175 today. My iPhone has 16GB of storage space, which is a little over a million times more than the RAM on the TRS-80.
Forty years ago, in 1974, a ten-pack of Wrigley’s Juicy Fruit gum made history as the first item ever commercially scanned with a bar code reader. For 67 cents, consumer Clyde Dawson received 50 sticks of gum and a place in history.
Check that; he didn’t even get the gum – it went to the Smithsonian.
A ten-pack of gum delivered from Amazon (in a box tracked from the warehouse to your door by a barcode) cost $13.99. That’s $3.05 in 1974 dollars.
Fifty years ago, in 1964, $8 could get you a ticket for the lower stand reserve section of Yankee Stadium to see the Yankees and Cardinals in Game 5 of the 1964 World Series. St. Louis won that game 2-1 in 10 innings and went on to win the Series in 7 games. Last year, the Cardinals also played in the Series, but the cheapest seats to watch them in Boston cost $699.95.
Prices aside, sixty-Two years ago, in 1952, the New York, New Haven and Hartford Railroad’s train 269 picked up commuters in Mamaroneck at 8:18 a.m. and deposited them at Grand Central Terminal at 8:58, for a total trip of 40 minutes. Today, the Metro-North’s New Haven Line train 1229 picks Mamaroneckers up at 8:16 and arrives at GCT at 8:57. Those seven minutes come at the expense of skipping a few stops.
The story repeats itself over and over; how can everything rise faster than inflation?
For starters, it’s hard to get apples-to-apples comparisons for a lot of things. Hardly any item in the Radio Shack catalog can be purchased today outside of eBay. You can’t really compare a car made in the ’70s to one made today because you’d have to find a ’70s car with all the features of a modern model. This would be hard considering that GPS satellites hadn’t been launched and USB plugs hadn’t been invented. Most importantly, the sunken cupholder didn’t come into being until 1983.
Then there are issues with how inflation is measured. Official statistics track changes in the price of goods as monitored in thousands of stores across the country. How much weight each product is given is, at best, an educated guess. Fads, substitutions and different methods of buying can muddy up the waters.
What we’re left with is two sets of numbers. One set is the official Consumer Price Index, which shows an orderly rise in prices punctuated by periods of high inflation. The other, from our collective memories, are numbers that are meaningless in aggregate but very important psychologically.
When I first started riding the subway, the fare was $1.50. Every increase after that seems like an exorbitant expense foisted on me by a wasteful MTA, whether or not I’m actually spending less per ride counting for inflation. Like many aspiring geezers, I have it fixed in my head what things should cost. A bottle of soda should cost $1.25. No economist can tell me not to grumble when it rings up for $2.