How High Have Gas Prices Risen Over the Years?
Inflation Adjusted Data
Gas prices are spiraling through the roof like never seen before. People often point to specific years that gas was so cheap, in an effort to blame politicians, Big Oil, or whomever else is the flavor of the day. Indeed, a gallon of gas was going for only a quarter of a dollar in the years after World War I, and even less than that before and after World War II.
- A 1920 Standing Liberty Quarter could buy you more than a gallon of gas for most of the years after World War I until after World War II.
But the key fact that’s missing from all the ranting and raving is the rate of inflation. The simple definition of inflation according to Wikipedia is: “A rise in the general level of prices of goods and services in an economy over a period of time.” Keep in mind, that at the end of World War I, average annual income was only $1,500. Currently, annual income is around $50,000.
For this exercise I plotted various sets of data in graphs — sometimes combined — based on information compiled by the U.S. Department of Energy’s (DOE) statistical office, the Energy Information Administration (EIA). The purpose of this two-part segment is to provide a clearer understanding of how much the price of gas has actually gone up relative to a family’s budget and other household costs, and most importantly, during what time frame.
1919-2011
If you look at a raw chart of the price of gas, and how much it has gone up since 1919 (the first year of available EIA statistics), it does indeed look scary. You can see a low of $0.17/gallon in 1931 rise all the way up to $3.53/gallon in 2011.
- Annual gas prices. 1919-2011.
But when the prices are adjusted for inflation, a much more balanced picture takes shape — although the spikes and drops are drastic. When taking inflation into account, average annual gas prices (in 2012 U.S. Dollars) were $3.35/gallon in 1919, $3.20/gallon in 1934, $3.44 in 1980, $2.49/gallon in 2009, $2.90/gallon in 2010, and $3.57/gallon in 2011. So it’s not like we’ve never seen this level of prices before.
- Annual gas prices adjusted for inflation 1919-2011. Cost in Feb. 2012 U.S. Dollars.
The next chart plots the course of the Consumer Price Index along the same timeline as annual gas prices adjusted for inflation. What you see — for the most part — is that from the early 70′s until the late 90′s and early 2000′s the price of gas actually dropped relative to the rising CPI. The drastic spike in gas prices in the most recent decade, along with only a moderate rise in the CPI — is the real story, which we will get into in the next set of charts in Part II.
- Annual gas prices and Consumer Price Index 1919-2011. Cost in 2012 U.S. Dollars.
The next chart merges the first and third charts, showing the CPI, nominal gas prices and inflation adjusted gas prices in 2012 U.S. Dollars.
Consumer Price Index and annual gas prices (nominal and in 2012 U.S. Dollars) 1919-2011.
Just for the fun of it, another interesting way to look at it is from the standpoint of 1919 U.S. Dollars. For this I calculated the value of 1919 dollars versus subsequent years and then plotted the price of gas accordingly, as if the CPI never changed. The chart below shows how much Americans were paying for gas if there was no inflation since 1919.
- Annual gas prices 1919-2011. Cost in 1919 U.S. Dollars.
In Part II of this segment, we will zoom in to take a closer look at the ballooning of gas prices in the last decade and examine how much more it has spiked than the rise in the CPI during the same time period.
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Nice work.
Can you do you chart for the past 50 years and highlight the years of the national election? I can’t remember reading in a paper stating that the Price of Gas is the lowest on elections months. This was back in 2008 so I was just wondering it if is possible?
Its untrue, politicians don’t really have any control over short-term gas prices, unless they somehow think it is worth it to sell political favors to gas companies in exchange for lower prices–unlikely because it would be cheaper and more efficient for them to just give campaign donations. Here is a more short-term graph: http://www.randomuseless.info/gasprice/gasprice.html It still doesn’t say exactly when the elections are. Still it is pretty clear that prices fluctuate randomly.
We owe a debt of gratitude to Sam. Thanks! His charts cut through the BS routinely tossed around by politicians of both partisan camps, and the gaggle of so-called print/broadcast journalists, feathering their nests with shrill appeals to unwitting audiences. The numbers don’t lie and right there on the charts is, perhaps for many, the discomforting reality that oil prices have remained affordable for most consumers over the long haul and remaining so despite occasional spikes that set off a chain of tremors throughout the entire.
An examination of the marked decline in the inflation-adjusted (real) price of oil during the 80′s and the 90′s tells a big part of the story as to why we witnessed robust (though not unprecedented) domestic and global economic growth during this two decade period. While there were many contributing factors for the sustained expansion of the American economy during this period, with an marked expansion of international trade being principal among them, the relatively cheap cost of energy enabled the growth of an increasingly up-tempo and highly mobile society–a level of mobility that had many believing by the time of a cresting of the waves ahead of the current recession that such a pace is either unsustainable, unwise or both. Which brings us in a fundamental sense to the ongoing debate about growth; do we view it as good, or insidious or as absolutely essential? The answers more often than not cast a light on the motive-force of the respective advocates. We would do well to plumb the depths of the proported solutions (or is that flavor of the day?) to the problems of scarcity that gird the work of the
“dismal science.”
Ben
What about a comparison of how much the gas prices drove everything else up by weakening our purchase power
I think you missed the point of the article.
The point he is making is that prices are not unprecedented. In other words, relative to 1919 they haven’t really weakened purchasing power.
RR
Gas prices were artificaially high in the teens and twenties due to the monopolies of JP Morgan et al during this period (things haven’t changed much).
The evidence shows that the price of gas has remained relatively stable. In 1919, we had just begun the age of the automobile, when gasoline rather than kerosene was the primary product of petroeleum. It was at that time when the spectre of peak oil began to be raised. The discovery of the East Texas Field in 1931 radically drove the price of oil down, because the Majors had little role in developing the fields and independents made large fortunes. The East TexasField through the Big Inch, supplied much of the oil for our war effort. Then came the discovery of the Gulf fields, and the cheap oil that came with it.
what about prices after De-Regulation. prices after major oil companies shrinking. prices after Rockafella had a monopoly . after the creation of OPEC, oil companies buying refineries ? future traders have no limit ??????????????????????????????????????/
That is what I would like to know. Every time gas prices spike so does everything else. I believe they have a lot to do with inflation. Their excuses are all over the map with nothing concrete to say for sure. They were pretty stable until they were de-regulated. When the government allowed the sale of refineries, the oil companies said they didn’t need, it really shot up. No folks, we are being lied to all the time for profit and greed.
Scott, I think the price of gasoline usually goes down at the end of the summer driving season because of reduced demand. Also winter blend fuel is cheaper to make than summer blend.
This roughly coincides with the november elections by coincidence, not conspiracy.
Right on.
Robert Rapier wrote an article on this specific topic many years ago, and it’s still relevant today. Take a look at Refining 101: Winter Gasoline for a more detailed explanation.
I think that they shouldnt let the crude oil prices affect the gas prices its unreasonable.I mean this is making people excuse my language extremely PISSED
and its causing caos and thats not what this state needs
“I think that they shouldnt let the crude oil prices affect the gas prices ,,,”
That’s just like saying they shouldn’t let the price of wheat affect the price of shredded wheat cereal.
^like this one MICHAELMCC
Also, we can’t forget it’s solely the jobless’ fault for not having a job, but it’s the government’s fault when those with jobs can’t afford gas.
Don’t tell the government to help the unemployed, they should work hard and help themselves. DO tell the government that my job isn’t good enough to afford commodities. I cannot get a higher paying job myself.
Not saying either is right, just pointing out the flawed rhetoric.
gasoline was in effect a byproduct of refining in the early 1900s was garbage until they made combustion gasoline engines
Today’s transportation fuel prices are as high as they have ever been, as evidenced by the charts above. It looks like lower fuel cost helps our economy, see 1945-1970 and 1985-2003.
It would be interesting to see a chart on miles driven per inflation adjusted dollar spent on fuel. I think we would see that today we are getting significantly more miles out of the equivalent expense. We should also keep in mind there is much less environmental pollution per gallon than in the past.
I wonder if there is enough information to allow a chart of gas prices, INCLUDING the portion spent through the government in subsidies, military support, etc? If subsidies have remained steady over the years, then 1919 adjusted prices would be higher – doubt this has happened!
I haven’t seen any freely available data such as you mention, Douglas. But I’d be glad to work on charting the data if you came across the data sets.
The comment about military costs suggests to me You might reflect on the fact that if we had not fought Hitler, he would have come in possession of the Middle Eastern fields. A plentiful oil supply was one our major advantages over the Germans. He got caught out on a limb at Stalingrad because he was reaching for the oil fields to the South and east. When we invaded Normandy, most of the Luftwaffe was grounded by lack of fuel.
Great work! This says a lot about the value of our dollars too… doesn’t it?
How about plotting ethanol cost per gallon. I’be seen that with the subsidies and efficiencies it adds as much as .50 cents per gallon.
t
T
Where’s Part II? I’m dying to see it!
The one thing that confuses me is why does gas seem to be affected more then other products? Obviously consumer prices have gone up across the board since 1919 including everything from a loaf of bread to a gallon of gas. But gasoline has more then doubled in the last 10 years, so why haven’t we seen the same thing happen to a loaf of bread? If inflation is the real reason for the steady increase in gas prices, why does it seem to be going up at a rate unlike everything else? Please advise.
We have seen it happen with for instance a loaf of bread used to be $.99-to $2.00 now 3 and four dollars just look at the store and you will see
If I understand the “Nominal and Adjusted” graph (next to last), the next graph should be normalized to CPI — so the CPI line shows as flat. 20% over $0.20/gal (left side of the graph) looks like about the same as $0.20, whereas 20% over $2.00/gal. (right side of the graph) looks hugely bigger. If the graph is normalized to plot over/under CPI normalized 1.0, it will show the 20% in proportion at both ends.
Articulating the reasons and justifications for the price of gas being what it is, is not reality! Reality is waking up one day and finding out that gas prices have more than doubled, yet your salary has not. Going to the grocery store and having to pay more than 4 dollars for a gallon of milk when yesterday you only paid 2.5. So, you can CPI everything to death, it still does not make reality feel any better! What you and all these financial geniuses are doing are basically saying its ok for these oil and gas companies to gouge the everyday American even if they are making billions in profit. Food for thought, but no food on the table.
@Rene: Actually what it does is remove irrational thought and emotion from the conversation. By doing this, it also helps remove the hyperbole, rhetoric and inflamatory language. Of course, one has to first be open to hearing that message and have enough intelligence to actually understand it.
Gas was $1.90 per gallon when Obama took office.
That price has more than doubled by the end of his first term.
The media blamed Bush whenever gas went up while Bush was president.
Why does Obama get a media pass?
Current policy has driven up prices.
You must be looking at a different graph than everyone else, the graph I see says gas was around $1.00 to $1.34 a gallon when Bush came in (2000) and $3.50 when he left (2008) about triple the price from when he came in till when he left. Under Obama it seems to be about the same. (I had my own business untill 2009 and do remember paying as much as $4.10 while Bush was still President.) The price then dropped under Obama to about $2.50. It has since crept up. Funny how we see things differently according to out politics! (I don’t see $1.90 anywhere on that chart under Obama!)
Actually gas was down to 2.66 by end of October and 1.87 by end of Nov 2008.
David, you are quick to look at 2000 and mention the low price as Bush came into office. And like so many liberals, you forget to mention what caused the jump in oil prices during Bush’s presidency. So many people will not mention the very strong “hit” our economy took after 9/11. Oil prices began their climb at that time as blame shifted and was focused on the middle east. I’m not getting into the righteousness of the War in Iraq, but this caused oil prices to continue to climb. The graph shows an increase in oil prices beginning in 2003 that parallels the massive spending that began with the War in Iraq and continues now into Obama’s Presidency. Admit it or not, but overspending by the U.S. government for whatever the reason will cause the value of our dollar to decrease. And the inflation that results will be felt in oil prices as well.
Our government’s current policies are destructive and will be if spending is not brought under control.
The drop in price was owing to the recession. The price of a barrel usually falls off when demand drops. But of course China is now entering its motorcar age, and is bidding up the price.
Ahahaha. Frankyb, you were reading and believing that ridiculous bill board weren’t you.? You can’t believe everything you read. The president really has nothing to do with the price of gas. Read more, think more, develop your own opinions instead of blindly following others.
the bush family is in to the oil bussness.
You may also find it interesting to add unemployment and gold prices to this chart. I have found unemployment to rise after each major (and even minor!) price spike. I interpret that to mean layoffs and business closures caused when energy costs force flakier businesses under, and stronger businesses to cut personnel to stay viable. In “Hubberdt’s Peak”, the author postulates that we may have hit peak production per user, or, if not, we will hit it soon. OPEC apparently used to regulate the cost of oil by closing and opening the spigot to manipulate the price. After reading the book, the incredible volatility of oil prices in current years suggests to me that we may be reaching a point where the spigot cannot be opened any further.
So, can we just blow somebody up? Well, I don’t think that’s possible – two of the fastest growing markets (China and India) simply have way to many people to fight. Personally, I think a better idea would be to go into alternative energy development as fast and hard as we possibly can.
Interestingly, gold prices are also driven by crude oil prices.
Gas is only 1part that that barrel of crude makes it is broken down bythese big Chemical plants used to make plastics….
I do not believe president of our country can make a decision alone others in our government has as much power if not more. I think this President now was AMBUSHED from get go.
As far as gas prices they are more vehicles on the road and air than ever before so it will cost more at pumps no matter who is presidentGas is only 1part that that barrel of crude makes it is broken down bythese big Chemical plants used to make plastics….
I do not believe president of our country can make a decision alone others in our government has as much power if not more. I think this President now was AMBUSHED from get go.
As far as gas prices they are more vehicles on the road and air than ever before so it will cost more at pumps no matter who is president.
Follow the path backwards from pump like who got it there the 18 wheeler (maintance), driver, (their paid), chemical plant(up keep from blowing us up) their workers (hazard pay), where did barrel come from? Who get paid next so on so on.
I hate too but can not change it.
Follow the path backwards from pump like who got it there the 18 wheeler (maintance), driver, (their paid), chemical plant(up keep from blowing us up) their workers (hazard pay), where did barrel come from? Who get paid next so on so on.
I hate too but can not change it.
Would gas prices be cheaper if more crude oil was extracted in the United States?
It should be, but if there are limitations as to where that crude could be shipped to and sold to, then oil companies would just take the crude and sell it in Europe or other countries around the world where profits are much higher. Oil companies are out to make the money that they can….JUST LIKE ANY OTHER BUSINESS. But their product effects ALL Americans.
And as far as Energy Independence is concerned. It is obvious that until Lobbyists are ran out of Washington, our elected criminals…I mean officials, will continue to sell out to the highest bidders. At this time, that happens to be Oil Companies. If there were some magnificent technological breakthrough that would reshape our energy industry and reduce oil dependence on oil, then Oil Companies would buy it up. Everything is for sale, when you are talking about Hundreds of Billions of Dollars.
I wonder how much these gas price increases have been due to the taxes on gas that keep going up and up?
Good stuff. I’d also like to see a chart that shows the price of gas compared to a barrel of oil. I would expect we would see gas prices rise as fast or faster than oil, and drop *much* more slowly than oil.
You can make up and chart you wish, and say whatever you wish. Fact is Min. wage went up, and everything else went up. Then gas went up and my 18 per hour job stayed the same for 5 years counting, and every time the gas prices go up, the food in the stores go up. Then the gas prices go down and the food price stays the same. Once again gas goes up and food goes up (but food prices DO NOT GO DOWN).
Could you make a chart showing the average miles per gallon over the years. Seems to me I remember a good MPG was around 16 MPG. Today my 6 year old car gets 25-30 MPG. That would make the cost of gas for the average consumer even because we use less.
http://www.youtube.com/watch?v=UzEnKdBAb_o
This guy has a couple small problems with his premise, first of all he’s using government numbers on inflattion and family incomes. I think we all know what they are worth. Second – he says he’s using “Family” income to measure against – a family income use to be only one person working, now it’s two, and that might even be with one or both parties working more than one job each. So this guy has got a little (I should say - a lot) more homeword to do. . .
So why didn’t you do your homework and calculate real prices at key points using your own numbers? Economists have an arsenal of many different inflation measures. the main point is robust to your chosen estimator of inflation.family income is the data that is available. its a little hard to conduct analysis with data that doesn’t exist. we also don’t know how much fuel each income earner uses. average commute is 13 miles each way. average fuel economy is 24 mpg. median household income is $140 per day.let’s make your assumption that a family has two income earners. they pay $8 per day to earn $140.gasfor work is 3% of income. That’s what we call a bargain.
As I understand it, the consumer price index IS a measure of inflation. What measure of inflation are you using that could be so dramatically different than the comparison of nominal gas prices against CPI?
Does this company also include the crude oil the USA buys or imports from other countries. It appears to me to only be what America produces and sells. Are the rates from across the seas similar to what we have been paying in the united states?
Gas prices in Europe are several times what we pay because of onerous taxes.
All this talk of inflation and supply and demand, but how many people had cars in 1919?
That’s the point. cars and gas were luxuries once. now even our poor have cars.
Could you display a graph of cost-per-mile of gasoline, adjusted for inflation AND fuel-economy improvements? It would be interesting to see the comparative impact on our budgets throughout the generations.
It would also be interesting to see a comparison of cost as percentage of median income.
That would make the picture look even better. what can’t be quantified is the utility people get per gallon of gas and the total utility in society. there is much more we can do with a gallon of gas than we could do with it 50 years ago. also, many more people are benefitting from it than 50 years ago. that is the main reason why gas prices have been rising.
Look at the facts:
Obama CANNOT say the words ‘terrorist attack’
Obama said ‘the future does not belong to those who insult Islam’
Do the math.
This man stands in defense of his Muslim brothers and will not offend them by saying ‘terrorist attack’. His ‘insult’ quote was code for Sharia Law.
Do the math.
Vote this traitorous bastard OUT on Nov. 6th because in the next four years he will shut America completely down. He hates it and wanted to CHANGE it and he is and he will unless you ACT to save America.
9/11 happened under bush and bin laden killed under Obama you ignoramus. The insulting Islam quote is called a quote mine– taken out of context– something the Christian Right does because their credulous, paranoic, frail minds are deeply entrenched in the denial of reality. This anti-intellectual heuristic is useful for complexities such as tiddlywinks strategies but insufficient for dealing the difficulties faced by world leaders. The right most oversimplify, vilify, and protect their delusions in order to provide succor to their brainwashed base.
Wow, throwing the “Christian” word in there, who said anything about Christians? Just because the “intellectuals” THINK they know better than God, and think there isn’t a God because their feeble minds can’t process something other than THEMSELVES, doesn’t make it true. True Christians are focused on one thing, and that just so happens to not be taking quotes out of context due to our “credulous, paranoic, frail minds that are deeply entrenched in denial. I think it is you who are in denial, so why don’t you stop insulting Christians, and just focus on whatever intellectuals focus on…
Nah, Christians are only focusing on one thing. Forcing their beliefs on everybody else. Abortion is bad, No gay Marriage, follow my god or you will burn in hell, prayer in school, prayer in the house/senate (even though there should be a separation of church and state..) . Maybe the Christians should just go back to their churches and focus on their priests so I can stop hearing about them on the news molesting little boys.
Just so you know, there isn’t anything in the Constitution that says “separation of church and state” that is a bastardized interpretation of the First Amendment (in part) “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof;” that is all is says. But people like you have stopped the morning recital of the pledge for reference to God, stopped the morning silence (that you could pray if you wanted to , which thereby “prohibits the free exercise thereof”, also abortion is killing period. this country was founded with GOD but people like you are ripping it apart. People like you allow a CHILD in Colorado to change HIS sex on HIS birth certificate to female because he likes being girly. Maybe we should change the terms for sex from male and female to XX and XY that way you people would have to change your very DNA to be classified as anything else……Oh and on a personal note I couldn’t ever obliterate my child from existence so I find it hard that my God whom is more merciful than I ever could be would do so.
Also I like how you threw as many big words in there as you could, i guess hoping most “ordinary” people wouldn’t understand what you were saying.. Good try!
Yes 9/11 happened under Bush but Clinton had 3 chances to kill Osma but didn’t. Obama on the other hand (if you really look at his upbringing) seems to favor Socialistic/Communistic views. I personally am very afraid of what his policies will do to this country. We really need to vote an independent into office (all offices) (maybe a type of person with shark like business skills) so they can fix the corruption the Reps and Dems have installed into the government. Remember the only reason the tax code is unfair is because they want it unfair. the only reason that government is the way it is is because they want it that way and we let them.
As a small business owner, gas prices prevent me from hiring.
If you look at the overqll tren of gas, the price has been going down over time. Just because of inflation adjustment that we’re paying the same as 1911, tells me we have not progressed.
The price has been going down due to technology and supply/demand. speculators have caused the spikes recently. allowing people to buy qnd sell nonexistent oil, all on paper is another problem.
We jeed to be energy independent
Whoops!
“While many of you are pointing to presidential administrations as the root cause for volatility of our nation’s gas prices, it is more accurate to state that commodity futures traders really started the roller coaster. Their bets and hedges against supply and demand, global events, regional conflicts affecting delivery of the raw material have had the most dramatic impact of the price of oil. Traders today are still allowed to purchase futures contracts for millions of barrels of oil without having to take delivery of the product. A simple rule that the Chicago Mercantile Exchange and NYMEX requiring Oil futures buyers to take delivery would go a long way toward halting the volatility we face today.” – Greg Mason
Corrected for inflation, we are paying MORE than even the crisis in 1979.
You are correct. The point though is that we are not paying many multiples of what our grandfather paid. it is more, but not much more. the.chief reason our current gas prices are so high is because China and India have quadrupled their demand for oil.gas taxes are also a lot higher than they used to be. if we removed gas taxes and requirements for blended fuels, the price of gas would be more comparable to what grandfather paid. I’m not arguing here to remove the taxes and environmental restrictions. I’m arguing that this chart compares apples with apple pie.
Sorry, but this also shows are ARTIFICALS Gas Prices have been Kept at to Support the Auto Industry, so they could keep Producing those Big V8 Engines an Pick Up Truck- Gas Guzzlers!
We should have let prices Ride per the Supply and demand like Europe Has and our Price per Gallong would probably Be Twice as High as it is?
That would have forced The American Auto Makers to make Alot more Fuel Effecient Cars /Vehicles and Acceleratated our Energy Reserach 20 yrs sooner..
Instead, for Decades, Our Cars Didn’t Get any Better MPG and even Now, My 09′ V6 Lincoln doesn’t get any Better MPG than my 01′ Mercury Sable V6 did.. Both Ave. 22 mpg btwn City nd Hwy driving or per what the Computer tells me all the time.
Not to Mention, Why wasn’t some of our SS invested Into AMERICA’s RESOURCES , such as OIL, GOLD and Real Estate? SS would be Worth at least 50% more now, Retiree’s would be Getting at Least +50% more as well.. and all would be fine with out SS..
and more would want to Put Even MORE into SS and maybe even DOUBLE how much is put into it by both the worker and the employer..
God Forbid!
Wall Street has Conned Us ! Just like Vegas Does.!
Supprting the Auto Industry has been a Big Failure..!
They Paid off our Congress and Gov’t to Build More Hwy’s and Keep The Price of Gas Way Below than it should have been..
All just to Provide Jobs to Support the LOOSERS OF THE WORKING CLASS.. The Factory Worker.. Insted of forcing earlier Generations to Stay In School and Get Better Educations and Job Skills..
It’s just More Indirect WELFARE to take care of these Loosers of our Society..
When , by Now? ALL of our Auto’s would be Made in Other Countries by Their Loosers or their Working Class, getting Paid the Right Amt. of what they are Worth ( equal to our $6 hr ) while most of Our Own would be enjoying the Fruits of our Educations and Be able to Retire by age 55 and not 65.
Providing More Factory jobs only Encourages Attracting More Of these Loosers and the Poor to our Country.. And the More you Provide to them, the more Comer Here..
We found that out with our own Towns Food Pantry.. The more We Provided, the More Came from other Towns to Get it.. Same goes for WAL MART workers- Just a Bunch of Loosing Class Stock Clerks and Checkers want to be paid Twice as Much as they are worth.. to Justify and Not Motivate them to Improve their Own Job Skills..to get a Better Paying Job..
Instead, they think they ought to be Paid More, for Just Showing up and Standing there..!
Never met so many Loosers in my Life and Very Depressing talking to them and Their Poor Attitudes..Which is why they are Working their In the First Place..
Their Thinkin’ is Stinkin’
We are always going to need a working class of people. We need people to work at wal mart. Why are you concerned how much they make ? It’s a private business. They need to make enough to survive right. All this talk about money when really money isn’t the biggest problem in this country, it’s the attitude of people. You can be poor and be kind and generous or you can be rich and be the same way. Money can’t buy someone into good citizenship. We have to work at being good citizens. We need to care about all of the people all of the time.
This report reminds of that time I slapped lipstick on a bull and called it my prom date. It looks good but reeks of bullshit.
And like someone who puts lipstick on a bull and took it to a prom, you’re an idiot. This is exactly the correct way to analyze it. But even this story leaves out the fact that there are many things more to do and see within range of a fixed quantity of gas than there used to be, so a gallon of gas makes us a lot happier per dollar spent.Cars are also a lit more efficient than they were in decades past. The average American uses one gallon of gas per day to get to work. the average daily wage is $140. So you have to spend $4 to earn $140. Oh, the horror!
Absolute BULLSHIT!!!!
Here is a song that explains it all:
Working For Gas
http://www.youtube.com/watch?v=OMN1uZmfUrM
good article
The problem with gas prices today is their volatility. It’s not unusual to see a 25% delta in prices in a month’s time – or less. That is something which has changed over the years. I can’t think of any other consumable product that is priced the way gasoline is priced.
A change in the underlying crude oil FUTURES price causes a pump price increase the next day. You don’t see that kind of price reaction from any other product, even those tied to a commodity. Bread prices don’t jump day-to-day even though the price of wheat and grains rises and falls. McDonald’s doesn’t put their prices on LEDs and change them daily due to the commodity price of beef cattle.
We have simply allowed ourselves to be conditioned to accepting without question the way gasoline is priced and sold.