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Question: Historical prices of items in terms of hours of work

I've read that the Federal Reserve Note is worth 2 cents today compared the Federal Rerserve Note of 1913. But I'm thinking both prices and wages in fiat currency have increased since 1913, so while I can see that inflation has been eroding savings, I would like to see what has been happening to buying power of wages.

Does anyone have a link to a site that lists the historical prices of things in terms of hours of work at median American wage for stuff like a loaf of bread, a litre of Coca Cola, a gallon of gasoline, a car, a month's rent, an acre of land, a 4-year college education, etc?

For example, suppose today's average gross work income is $40,000 per year or $13.74 per hour. A $2 loaf of bread costs about 0.15 hours of work. How many hours did the loaf of bread cost in 1980, 1960, 1940, 1920, etc?

I can do the calculations myself provided that I can get access to data on historical median wage or salary in fiat dollars (unadjusted for inflation) as well as historical prices (again in unadjusted fiat dollars) for the things that I mentioned:
a loaf of bread
a litre of Coca Cola
a gallon of gasoline
a car
a month's rent
an acre of land
a 4-year college education

Thanks in advance.




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Back when the Pheonix Dollar

was in business, and growing... they were interested in making a strong educational case for precious metals. The site requested members to research historical prices of items before we went off the gold standard with the prices of the same items today.

While on the gold standard, price stability was amazing! The price if a Hershey bar was essentially the same from the mid 1800s to the decoupling of gold, and since then it is like 1200% more now!

Did

you try this?
http://www.bls.gov/CPI/

Detective Krum Investigates:
http://victory1project.wordpress.com/
http://v1-p.com/

Detective Krum Investigates:
http://victory1project.wordpress.com/

Hello V1-P,Yes, I've tried

Hello V1-P,
Yes, I've tried http://www.bls.gov/CPI/
but the data at this site goes back only 30 years or so.

I came across this the other day...

The average American might just conclude that prices always go up, so what’s the big deal about inflation. This is where the Federal Reserve and politicians have pulled the wool over your eyes. The CPI was 30.9 in 1964. Today, it is 211.1. This means that prices have risen 683% since 1964. The only problem is that your wages have not risen at the same rate, even using the government manipulated CPI. Using a true CPI figure, average weekly earnings are 64% below what they were in 1964. This explains why a family of five could live well with one parent working in 1964, but even with both parents working and using debt in prodigious amounts, the average family does not live as well today.

"It ain't what ya don't know that hurts ya. What really puts a hurtin' on ya, is what ya knows for sure, that just ain't so."

"It ain't what ya don't know that hurts ya. What really puts a hurtin' on ya, is what ya knows for sure, that just ain't so."

Good evidence and logic.

I'll chew on that for a while :)

OK (thinking aloud) in 1964 my old man ( 40 then) made maybe $5000 a year and my mom took care of seven kids and her mom too. We had 1 used car, froze our asses off in the winter, ate pretty good, no health insurance, ....when he dropped dead in '79 he didn't have a penny of savings, no life insurance, no mortgage...hmmmm

h-daddy

$5,000.00 in 1964 had about

$5,000.00 in 1964 had about the same buying power as $34,017.80 in 2009.

"It ain't what ya don't know that hurts ya. What really puts a hurtin' on ya, is what ya knows for sure, that just ain't so."

"It ain't what ya don't know that hurts ya. What really puts a hurtin' on ya, is what ya knows for sure, that just ain't so."

Read Tom Dilorenzo's book

"How Capitalism Saved America", in there he has a chart of historical prices back then and today. There are numerous things on that list. Of course things are cheaper today because the world is more productive today and technology has made a lot of things possible. The dollar is worth only 2-3 cents compared to what it used to be and this symbolizes the loss of savings more so than it has to do with current prices. Think of all the money people lost over the years that was confiscated by the bureaucrats. Sure some wages have kept up but others have not.

"Greater than the force of mighty armies is the power of an idea whose time has come"
- Victor Hugo

"Greater than the force of mighty armies is the power of an idea whose time has come"
- Victor Hugo

Who cares about hours of work?

Any given hour of work may not necessarily have the equal value. You could spend an hour digging a ditch that later gets filled in. Even work that seems "productive" (like building houses) may not be worth anything, if what is produced is valueless.

That is the point of capitalism, it does not make a broad judgment about the relative value of things (1 hour = 1 hour); instead it lets individuals judge for themselves what they need or want and create value out of that trading interaction.

I think everyone cares about hours of work

I know I do. Working more for less is what most folks want to avoid.

h-daddy

Thoreau cared quite a bit.

Thoreau cared quite a bit. One of his biggest points in Walden was that a society which forces its people to work harder to obtain basic needs has no room to call itself more civilized than supposed savages who are all fed, and all have a home wherever they pitch one. (at least at the time of writing, I'm sure zoning laws, and city ordinances against being homeless would make this next to impossible now leaving the option of freezing to death or breaking the law)

Absolutely.

But a metric on the personal level is not necessarily an appropriate metric on the social level.

I go to work on the personal level.

How about you?

If the r3volution is about personal liberty then one would think its economic arguments would focus on individuals as well.

h-daddy

I think you are missing the point

yonemoto is correct; one person's hour doesn't necessarily correspond to anyone else's hour. Someone digging a ditch or bagging groceries has to work a lot longer for a loaf of bread than a brain surgeon or a tax attorney. Now if you are talking about mean figures across society, the stratification of salaries over the decades has skewed things so far in favor of the brain surgeon or tax attorney that you really can't make assumptions without digging much deeper into particular job markets.

************
http://www.pyrabang.com - the People's "information stock exchange" that will take a huge bite out of Google's ad profits and put them in your pocket!

I got the point which is

why I think a general comparison of living standards is more revealing than talking about prices, wages, technology, etc.

The info in this thread suggests that today's ditchdigger works less time for a loaf of bread than his 1913 ancestor. Doesn't that surprise you?

h-daddy

I go to work because I have

I go to work because I have to, with money being worth less every second I hold on to it. Yay, inflation. On a personal level, I'd much rather work for myself, than for someone else...or for the federal government, for that matter.

As for personal liberty - if the r3volution succeeded entirely, you'd be able to make your own fiat money if it pleased you. Granted, you're probably not able to make that declaration of "fiat" worth anything to those around you, without something backing it. Still, you'd be free to do so.

You know, when RP talks about the worth of the dollar...

he's probably not talking about prices.

Austrian Economists define inflation as 'increase in money supply' as opposed to 'increase in prices.' I'd wager that the M0 stats from 1915 are around 3% of the M0 stats from 2007/2008.

When Ron goes off on the 'decrease in purchasing power' he's talking about the dilution of each unit of money. The fact that prices in hourly terms have gone down is not all that interesting-- that's what happens when productivity increases. If we hadn't inflated to hell and back again over the past sixty years, then the increased purchasing power would have shown up as mild deflation. In essence the dollar would have gotten stronger instead of hourly wages and prices going up like mad.

The problem with the system is that it penalizes savers, and allows certain parties a chance to use 'new money' before the market has adjusted prices to counteract for the inflation of the monetary base. In essence, it forces people to take out larger loans, and gives some folks some free purchasing power at your and my expense.

the difference not being noticed...

today China's, and other "slave labor nations", cheap labor is the difference. it used to be everything was made in the U.S., which created a wealth of good paying jobs. this in turn created security and wealth for our country, and it's people, which has all been subverted by government and the financial elite, by their greed. Now, those jobs have been sold out to slave labor around the world for the benefit of the owners of companies. this has put the U.S. in a very precarious situation. We as a nation no longer have a self sustaining, secure, country, because of their greed, and the greed of "cheapness" by the people themselves.
what in essence is the difference is that we have sold our security and sovereignty for greed's sake., and we are now at the mercy of other nations for our well being. if China and the other "slave nations" ever demand the pay-grade of the U.S. for their services, our country will collapse.
WHEN that happens the only ones that will survive will be the people who are willing to work and re-industrialize the U.S. to be able to sustain it's own needs, and provide for trade with other countries.
THAT day is the day that the TRUE worth will be revealed for products and services, and their worth, in any currency.

2Chronicles 7:14 If my people, which are called by my name, shall humble themselves, and pray, and seek my face, and turn from their wicked ways; then will I hear from heaven, and will forgive their sin, and will heal their land.

the difference not being noticed...

Please do not blame greed for loss of jobs, this just distracts from the real issues. As Tom Woods says in Meltdown blaming greed for economic crash is like blaming gravity for airplane crash.
Greed balances perfectly with the threat of loss. You cannot legislate "non-greed".
The major issue here is the Fed and lack of sound money. Think about it: if you had a dollar printer would you work? Of course not. You'd have someone else do your work and then just print the money and pay them. So this is really what happened to American jobs that went overseas. This has nothing to do with greed.

isn't "Printing Money" and the removal of sound money...

ultimately..."GREED"? i would say that it is. it is also Treasonous.

Proverbs 20:23 Divers weights are an abomination unto the LORD; and a false balance is not good.

2Chronicles 7:14 If my people, which are called by my name, shall humble themselves, and pray, and seek my face, and turn from their wicked ways; then will I hear from heaven, and will forgive their sin, and will heal their land.

Re: isn't "Printing Money" and the removal of sound money...

Bah! This is like saying the bakery across the street is running on greed. Of course greed has something to do with it. But greed has to do with everything we do - it's just human nature. If we didn't have greed we wouldn't have anything - stores, jobs, cars, computers, software, phones, railroads, ships, hospitals. People are driven by greed to create things other want. This is just how things work. Do you think Steve Jobs, Bill Gates, Edison, Ford, James Hill and the rest of them want to work for minimum wage? Of course not! However, the common factor among them is that they created something others wanted. So it's really creativity that is common among all these men.
When you start questioning greed for people's actions you get on the slippery slope. Think about it - the jobs that went overseas you just decried - how did these jobs get created in the first place? Didn't greedy people create them? Of course! So what's the problem with greed then? I know what it is - dishonesty.
You can be greedy all you want but you can't be dishonest - this is where one draws the line. And funny money is dishonesty.

then why has Ron Paul accused the Federal Reserve ...

of STEALING from honest people who have saved and worked hard for what they have, by manipulation of the money supply and interest rates???

Because Ron Paul knows what "Unjust weights and measures" are. it is by changing the "weight and measure" of the Dollar by interest rates and money supply that the Federal Reserve IS STEALING, THIEVERY!!! DONE BY GREED!!! FOR THE BENEFIT OF A FEW!!!

WHAT CAUSES "DISHONESTY??? GREED.

"The love of money is the root of all evil."

2Chronicles 7:14 If my people, which are called by my name, shall humble themselves, and pray, and seek my face, and turn from their wicked ways; then will I hear from heaven, and will forgive their sin, and will heal their land.

Greed?

Yes, dishonesty can be caused by greed. But not only by greed. It can be caused by laziness. If I cheat on a test does it mean I am greedy? No. It means I am lazy to work on the answers myself. People who work for the government and retire 10 years younger - are they greedy? Hardly. They're just lazy and don't want to work too hard for a living.
Therefore, we have laziness and greed that cause people to be dishonest. Therefore, we cannot perceive greed or laziness as the the root of evil. The root of evil is dishonesty.
You can still be greedy but honest. You can be non-greedy and dishonest as well. Apparently, greed is not necessarily the motive for evil actions.
Also, greed for the most part has a rather narrow meaning, if you look at Webster, the definition is:
-- An eager desire or longing; greediness; as, a greed of gain.
--excessive desire to acquire or possess more
--reprehensible acquisitiveness; insatiable desire for wealth
Dishonesty, on the other hand, has a very broad meaning because it can be applied to many situations. Dictionary definition:
--Violation of trust or of justice; fraud; any deviation
from probity; a dishonest act.
In the case of sound money cheating about the value of a dollar bill fits the definition of dishonesty just fine but not necessarily greed because greed would dictate personal motives and motives are hard to prove. You could assume that it would be greed but that may not be true.
You don't want to put the blame on greed because greed is a human characteristic and cannot be quantified. When you cannot quantify problems you are on a dangerous road to overstepping freedoms and property rights. Dishonesty is easy to identify, spot and correct. Dishonesty is a breach of contract. Contracts are usually written, they are clear and are designed to create trust and guarantees. No wonder that in the Constitution of the United States there are clauses that dictate that the government should enforce contracts but mentions nothing about greed.

motives are not hard to prove...people are 'dishonest' for a ...

...reason. No one has ever been 'dishonest' just to be 'dishonest'. there is always an underlying reason...DESIRE, ardent desire to be more precise. you could even take it to the next level of underlying desire...COVETING.

Greed
GREED, n. Greediness.
------------------------------------------------------------------------------------
Greediness
GREE'DINESS, n. Keenness of appetite for food or drink; ravenousness; voracity.

Fox in stealth, wolf in greediness.

1. Ardent desire.
------------------------------------------------------------------------------------
Ardent
'ARDENT, a.

1. Hot; burning; that causes sensation of burning; as, ardent spirits, that is distilled spirits; an ardent fever.

2. Having the appearance of quality of fire; fierce; as ardent eyes.

3. Warm, applied to the passions and affections; passionate; affectionate; much engaged; zealous; as, ardent love or vows; ardent zeal.
-------------------------------------------------------------------------------------
Desire
DESIRE, n.

1. An emotion or excitement of the mind, directed to the attainment or possession of an object from which pleasure, sensual, intellectual or spiritual, is expected; a passion excited by the love of an object, or uneasiness at the want of it, and directed to its attainment or possession. Desire is a wish to possess some gratification or source of happiness which is supposed to be obtainable. A wish may exist for something that is or is not abtainable. Desire, when directed solely to sensual enjoyment, differs little from appetite. In other languages, desire is expressed by longing or reaching toward, and when it is ardent or intense, it approaches to longing, but the word in English usually expresses less than longing.

We endeavored-to see your face with great desire. 1 Th 2.

Thou satisfiest the desires of every living thing. Psa 145.

Desire is that internal act, which, by influencing the will, makes us proceed to action.

2. A prayer or request to obtain:

He will fulfill the desire of them that fear him. Psa 145.

3. The object of desire; that which is desired.

The desire of all nations shall come. Hag 2.

4. Love; affection.

His desire is toward me. Song 7.

5. Appetite; lust.

Fulfilling the desires of the flesh. Eph 2.

DESIRE, v.t.

1. To wish for the possession or enjoyment of, with a greater or less degree of earnestness; to covet. It expresses less strength of affection than longing.

Neither shall any man desire thy land. Exo 34.

Follow after charity, and desire spiritual gifts. 1 Cor 14.

2. To express a wish to obtain; to ask; to request; to petition.

Then she said, did I desire a son of my Lord? 2 Ki 4.

3. To require.
-------------------------------------------------------------------------------------
Covet
COVET, v.t.

1. To desire or wish for, with eagerness; to desire earnestly to obtain or possess; in a good sense.

Covet earnestly the best gifts. 1 Cor 12.

2. To desire inordinately; to desire that which it is unlawful to obtain or possess; in a bad sense.
-----------------------------------------------------------------------------------------
definitions from - Webster's 1828 Dictionary

2Chronicles 7:14 If my people, which are called by my name, shall humble themselves, and pray, and seek my face, and turn from their wicked ways; then will I hear from heaven, and will forgive their sin, and will heal their land.

Thanks!

I've been saying the same thing since they started beating the drums for the idea of NAFTA (long before they actually rammed it through). And, I have to say that 80% of Americans were against it when our mentally and morally challenged politicians sold us out that time.

I posted this last year

http://www.dailypaul.com/node/24793

The last data I had available at the time was 2006, but the historicals are still valid, of course. The best historical measure of purchasing power is per capita GDP, as technological advances tend to skew prices across generations. Per Capita GDP, however, just measures the total output (regardless of what that is) and divides across the population. That number is then used to distinguish economic equivalence via inflation, or purchasing power, across the generations.

Hello Mixer, I read your

Hello Mixer,
I read your previous post: http://www.dailypaul.com/node/24793

Would you please tell me where you acquired the data for this part of your post?

"Taking a different track, let's look at some averages in 1934, the year we went off the gold standard domestically:

Average wages per year $1,600.00

Average Cost of new house $5,970.00 (370% of wages)
Average Cost of a gallon of Gas 10 cents (.006% of wages)
Average Monthly Rent $20.00 per month (1.25% of wages)
Studebaker Truck $625.00 (39% of wages)

Now let's look at the same averages in 1971, the year we went of the gold standard internationally and became a true fiat currency:

Average Income per year $10,600.00

Average Cost of new house $25,250.00 (238% of wages)
Average Cost of a gallon of Gas 40 cents (.0037% of wages)
Average Monthly Rent $150.00 (1.4% of wages)
Datsun 1200 Sports Coupe $1,866.00 (17.6% of wages)

Now lets look at some averages in 2006:

Average wages per year $44,472

Average Cost Of a new house $299,900 (673% of wages)
Average Cost of a gallon of Gas $2.90 (.006% of wages)
Average Monthly Rent $991.00 per month (2.2% of wages)
Average Cost of a new car $24,400 (54.8% of wages)"

Thanks.

Oh boy.. a lot of places?

I mainly looked at online historical sites - those that drew data from old newspaper ads. I pulled some straight from old articles, some from government sources. I remember one of the sites I used was thepeoplehistory.com - a lot of good stuff there. I also dug into the Time magazine archives; you sometimes have to convert (like how much per gallon does a hundred-weight of milk at 2.35 cost: http://www.time.com/time/magazine/article/0,9171,761933,00.html) but the data should be reliable.

Again, fascinating info. Thanks.

Seems to be that the GDP route doesn't give a very good picture of what is happening in households but rather the country as a whole. In your original post you come down very clearly on the side of a gold-standard based monetary system. And yet it seems much of the data suggests that the fiat system served us fairly well. .

h-daddy

GDP

There are other factors involved (quality of life improvements, technological advancements, etc) that GDP doesn't account for. Back in the 30's, a telephone was an expensive luxury while today, it's a cheap necessity. Comparing the prices of telephones over an 80 year period gives an inaccurate portrayal of purchasing power. Per Capita GDP, while not perfect, gives the clearest picture because it doesn't factor any specific things - just the overall wealth as divisible by the number of people.

You should read the article; inflation under a sound money system and inflation under a fiat system are two different beasts. While both are an increase in the money supply, with a grounded monetary system, to truly inflate requires changes in the underlying economic system. If you have X million ounces of gold and you want to inflate, you have to devalue the existing notes by whatever percentage you wish to inflate. It's out in the open, can't be covered up and is reflective immediately in prices and wages. People who save for the future immediately know how much wealth they have lost and can take whatever measures they wish to compensate. Under a fiat system, inflation is merely a decision made by the controlling authority. If that authority, for whatever reason, needs more paper, they just print more. No change is needed to the economic system and subsequent inflation is just applied to the marketplace at the rate the new paper enters the system. No announcement is needed, no warning is given. Unless you are a saver who regularly reads the charts at the Fed, you might not know how much wealth you have lost and may not be able to compensate for that loss.

This is the true horror of a fiat system. There are no "rules" you can follow to plan for the future; no retirement plan you can adopt that will guarantee comfortable golden years. A century ago, planning for retirement was simple. Buy land, build a house, save your money. A dollar saved in 1850 bought as much as a dollar in 1900. A dollar saved in 1950 bought 14 cents worth in 2000 (and only buys 11 cents of goods today).

Luckily, there has never been a fiat system on Earth that has lasted. Most average about 70-75 years before they hyperinflate and collapse. The US is close to that point now. We might last another few years, but the system is starting to crack now. Follow the ForEx to see; people are talking about "dollar strength" when the EUR/USD pair is 1.31 (down from 1.5 from last year, but far above the .87 from 5 years ago); even under John Law the Mississippi Company was hyped right until the shares collapsed.

OK, I read the article and I

understand every point you make. Let's assume for the moment that the worst thing that a monetary system can do is lower the standard of living. From the data concerning relative prices, it appears that purchasing power per household has increased over the last 100 years. And, I think very clearly, that even though the population of the USA was more than doubling during that same time period, there has been a substantial increase in our overall standard of living. All this despite having a fiat monetary system. What gives?

"A century ago, planning for retirement was simple. Buy land, build a house, save your money. A dollar saved in 1850 bought as much as a dollar in 1900." Now that statement makes me pause...!

"A dollar saved in 1950 bought 14 cents worth in 2000 (and only buys 11 cents of goods today)." That assumes you put the dollar under your mattress rather than lending it out at interest until needed.

h-daddy