Price Versus CostIn: Mish-mash, Mom's Oracles, Red Said
To determine how much something costs today compared to yesteryear requires knowing more than just the price of the good or service as my children so astutely pointed out to their Grandma Minnie back in 2008. We were all sitting around the dining table enjoying breakfast and debating going to see a movie. My mom asked the price of movies and when I told her that tickets were nearly $10 a piece, she said one of the three things that she will forever be remembered for: “Oh goody!”, “Oh shit!”, or “Oh boy!”. It wasn’t “Oh goody.”
Thus began a discussion of economics which was fairly typical for us as value, frugality, and scarcity versus abundance were hot topics in our household. Grandma Minnie was spurned on to “tell us about how much it used to cost to go to the movies.” I can picture my mom, sitting to my right, meticulously cutting her breakfast meats and fruit, savoring a bite before delving into her anecdote. “When I was a girl, it cost a fella $.50 to take a gal to the movies and that was for a double feature,” she said matter-of-factly. I just loved that she automatically assumed a guy would be taking her and paying for the tickets. All three of my kids whistled and expressed amazement at how cheap it was compared to today. “And that included getting burgers and a coke,” she added.
Pensive Omar was then awarded a big gold star for being insightful, asking what one had to do to earn the $.50. And sure enough, Mom had an answer for that too. Growing up in Oregon where a typical job for a teenage boy was to pump gas- a service that was mandated by the state, but also included checking the tires, fluids, and washing the windows, unlike in present-day New Jersey where an attendant is likely to put gas in your Diesel (yes that happened to me) and think you strange to request a window cleaning. The attendants earned $.25 an hour plus a dime, or so, in tips. So one could exchange two hours of labor for a date with a gal where you could both eat, drink, and be entertained for nearly 4 hours. Compare that to today, when for basically the same job, one would have to work four times that amount to purchase even less.
Why is it that there is such a disparity between the cost of living and wages today versus 60 years ago? Quite simply…inflation. People complain about the government regulations such as minimum wage, workman’s comp, and insurance as if those things are responsible for the economic crisis plaguing the US economy, when, in fact, they don’t even make a dent compared to the out-of-control printing of money that has no backing, other than a promise of the US government to tax the workers to pay the interest on the debt.
And the irony is that the very people who the government is portending to help with all of the regulations and stimulus are the very people hurt by it. But what does it matter to Congress when they can and do vote themselves a standard-of-living wage increase while exempting themselves of the mandates with which they burden their constituents? The solution is to end the Federal Reserve, allow for competing currencies, abolish the subsidies (start with the banks!), and allow the market place to establish prices and values. Incidentally, a quarter ounce of weed cost the same today as it did 30 years ago…chew on that.