When you sit down for Thanksgiving dinner this month, one thing to give thanks for is how unbelievably inexpensive everyday goods are today. A 20lb turkey today costs about $20, according to the USDA, and a gallon of milk costs $3.14. People paid $0.49/lb for turkey and $1.00/gallon for milk in 1950. Adjusted for inflation, people in 1950 were paying the equivalent of $98 for a 20lb turkey and $8.00 for a gallon of milk!
If they had to drive somewhere for Thanksgiving, the $0.20/gallon price of gasoline in 1950 would have been equivalent to $1.80/gallon today. According to the EPA, average miles/gallon has doubled since then. Since the price of gas hasn’t also doubled, it is cheaper to drive today. If they wanted to fly, a flight from New York to L.A. would have cost $1,400 per person in the 1950s, a price that remained unchanged through the 1970s. Today, flights from New York to L.A. for Thanksgiving weekend can be booked on Expedia for less than $700. People who complain about the lack of amenities with current air travel fail to realize that tickets today are substantially less expensive than when air travel was more glamorous. In the 1950s, 80% of Americans had never been on a plane!
Thanksgiving traditionally marks the start of the Christmas shopping season. Suppose in 1952 someone want to buy a doll for his/her daughter and a tricycle for his/her from the Sears Christmas Wishbook. The doll would have cost the equivalent of $86 and the tricycle the equivalent of $100. Today a Cabbage Patch Kids doll costs $40 Amazon.com and a Radio Flyer tricycle costs $50. If someone’s washer and dryer broke down in 1952, a new set would have set them back the equivalent of $3,500. Browse the archived Christmas Wishbooks at www.wishbookweb.com and adjust the prices for the products for inflation so see what the equivalent price in 2016 dollars is. You will be shocked at the high prices people were paying in the 1950s.
It is important to note that people were paying these prices while earning much less income. Adjusted for inflation, average income in the U.S. in 1952 was $17,900. This is roughly the same as what a fulltime minimum wage earner in Michigan in 2016 earns over the course of a year. This means that in 1952, that new washer and dryer set would have cost the equivalent of 19.5% of an average person’s yearly income! For perspective, average income in 2016 is $57,500 per person. A mid-priced washer and dryer set can be purchased at Home Depot for about $1,100, which is less than 2% of an average person’s yearly income.
In the 1950s, food was about 20% of a family’s budget. Today, it’s about 5%. In the 1950s, clothing was about 9% of a family’s budget. Today it’s about 3%. It is human nature to romanticize the past. There are probably a lot of things we can look back on with nostalgia, but how affordable things were is not one of them.