Ed Dolan writes:
Recently I came across this assertion in a comment box on one of my favorite websites: “The cost to fuel your car has never been higher as a percentage of disposable income.”
Really? I know gasoline prices are high, but you just can’t make that assertion without looking at incomes and fuel economy, too. I decided to check the data.
I was able to put together 50 years of pretty consistent data for the key variables, with only a little stitching together to make the starting points and end points fit...
Miles per hour worked peaked at 271 in 1999, a year when gasoline cost a modest $1.13 per gallon, the average car on the road got 22.9 MPG, and the average production worker earned $13.49 per hour.
Since then, gasoline prices have risen sharply, fuel economy of the average vehicle has gone up only slowly, and wages have not risen as fast as gasoline prices. As a result, the average MPHW has fallen by about 35 percent to about where it was in 1980. Here’s the full chart:
This makes sense. America's real income hasn't budged since the 70's.
ReplyDeleteOver the last 40+ years, all of the spending, all of the stimulus by the FED and the Congress does nothing to real wages at the very least and at worst actually suppresses them.