If you have any questions about what economists mean by inflation, just look at yesterday’s buying power.
Those old western movies talked about wages of $1 a day. That wouldn’t even buy a burger at a fast food joint today by the time sales tax is added in.
We don’t have to go that far back, either. When I was a kid, my dad was a career teacher in Minnesota, and with a dozen years at his last school system, he signed a 12-month adult education agricultural teaching contract for $5,000 a year. After deductions, his month’s pay amounted to about $324.
Teachers in the early 1950s, of course, were hardly the best-paid workers. But neither were they the lowest. Once I overheard a city bus driver discussing his salary with a passenger, saying he earned about $260 a month. That’s less than today’s minimum wage.
And prices were correspondingly low. When Mom sold our home before our move to Indiana, the sizable three-apartment building in the middle of town went for $13,000. We moved here and in a few months bought a small 1 ½-bedroom home for something like $9,000.
You could get a hamburger at Hill’s Snappy Service for 15 cents. A meal at most downtown eateries was about 75 cents. A haircut at Tom Haston’s Barber Shop was 75 cents. Soda pop was a nickel. Through high school I worked Saturdays at my uncle’s store, eventually earning 50 cents an hour.
Taking my first job out of high school, I worked 50 hours a week at straight time (overtime didn’t apply on that job in those days) for $1 an hour, grossing $50 a week. I saved enough that summer to buy a car – a 1950 Chevy, which cost me $225 – and cover my first semester’s tuition at Anderson College. With a half-tuition scholarship, I had to pay out just over $100 for an entire semester.