bloke wrote:Isn't it incredible how much cheaper gasoline is now than it was in the past????
I remember when I was in junior high school gasoline was $.40 gallon and Mirafone 186 tubas were $700.
Now, Miraphone tubas are $6000 (over 8X as much) and gasoline is only $2.25 (less than 6X as much)...and this is with at least $.50/gal taxes now added to the price of gasoline!!!
At $2.25, in the modern U.S. economy folks don't even "budget" for their weekly gasoline. Even lower income folks probably spend more money weekly on pre-prepared foods (read: "A CONVENIENCE/A LUXURY") than they do on gasoline.
bloke "gasoline-schmasoline"
Yeah, well, I remember the IBM 386 compy that my dad bought in 1992. $2400. Now, I can get a compy that is better in magnitudes from Dell for $500.
A better comparison is the cost of milk or eggs and the cost of gasoline. They have similar economic properites (# of substitutes, elasticity, etc.).
1960 cost of one gallon of milk: 49 cents
2005 cost of one gallon of milk: $3.69
1960 cost of eggs: 42 cents
2005 cost of eggs: $1.89
1960 cost of a gallon of gas: 31 cents
2005 cost of a gallon of gas: $2.22
Increase in Milk price: 7.53 times
Increase in egg price: 4.5 times
Increase in gas price: 7.16 times
How about this?
Cost of a home in 1960: $16,500
Cost of a home in 2005: $265,000
Increase in price: 16.06 times
Gasoline prices sit somewhere in the middle of the big picture, increase-wise. Think about how much better a new car is in nearly every single way than a car from 45 years ago. Safety, reliability, performance, etc. have all been improved. So not only has the price of gas been not that big of a deal, we should be using less of it because of effeciencies. However, the prices stating artificially low have driven US consumers to not gain certain effeciencies, i.e. purchsing SUV's.
People who do not budget for transportation costs in their family are asking for trouble, though, as all expenses should be taken into account.