The cost of fuel for transportation has recently been a major subject of discussions. The data shown was obtained from the U.S. Department of Commerce and other websites. It is recognized that the cars we drive today are much better than those manufactured in 1960. Also how much and how we move about also has changed.
Yearly Expenses 1960 1960Today 2006
Total Transportation $759 $ 5,277 $ 9,601
Note: 2006 is the last year with data available.
General Expenses 1960 1960Today 2008
Gallon of gasoline $0.25 $1.75 $3.96
New Chevrolet $2,230 $15,499 $21,975
Average new car $2,600 $18,070 $28,400
Round trip airfare
Cleveland to Baltimore $ 75 $ 521 $ 262
Other Data (per household): 1960 2008
Registered cars & trucks 1.44 2.17
Highway fuel (gallons) 1,123 1,615
The effect of the current high price of oil on the cost of transportation is not fully captured in the 2006 U.S. Department of Commerce estimate. Even with the increase in oil prices, it appears that the overall cost of transportation has increased at a rate twice as fast as the CPI rate of inflation. It appears that part of the increase is due to the increase in the cost of safer and more appointed automobiles. We also have increased costs due to longer average commutes from the suburbs than existed in 1960.
It is significant that the cost of airfare has increased at a rate roughly half the CPI inflation rate. Until 1978, airfares were regulated by the U.S. Government.
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The following 1960 prices were obtained from a 1960 Greenville, Mississippi newspaper. A concerted effort was made to find prices for equivalent items today. Your cost experience may be different.
Item 1960 1960Today 2008
Mans Golf Shirt $ 2.98 $ 20.71 $ 16.99
Haggar Slacks $10.95 $ 76.10 $ 35.00
Womens Tennis Shoe $ 2.99 $ 20.78 $ 25.99
Washing Machine $ 178 $ 1,237 $ 399
Three bedroom house
Monthly Rent $ 98 $ 681 $ 1,150
Average New House* $16,500 $114,675 $313,600
* From the U.S. Department of Commerce 2007 Data
Yearly Cost Per Family 1960 1960Today 2008
Housing $ 832 $5,782 $12,129
Clothing and Jewelry $ 653 $4,542 $ 3,137
Personal Care $ 110 $ 762 $ 1,085
Household Operation $ 896 $6,228 $ 7,953
General Household Total $2,491 $17,314 $24,305
Data From the U.S. Department of Commerce
With the exception of housing, it appears that in general, household items have increased at a rate close to the CPI rate of inflation. The appliance industry appears to be providing a significantly higher relative value today verses what it did in 1960. The increases in new home prices and the average yearly cost can be partially explained by the increase in size and amenities that come with homes today verse homes purchased in 1960.
Original: August 19, 2008; Update August 25, 2008