Gas prices, Inflation, and Eating Out

Cox and Forkum recently linked to this chart that graphs the price of gasoline in the US over a 25 year period, as paid by one particular consumer.

It’s fascinating, because what it says is that when inflation is accounted for, we’re paying less now for gasoline than we did at the height of the 1980 “energy crisis.” Granted, it’s just a hair less, but it’s still LESS. There was gasoline rationing back then. You had to wait in line at the pump, and the attendant would sometimes check your gas gauge and if you still had half a tank or more, he wouldn’t let you fill up.

I got to thinking about that. I remember back when gasoline was $1.20 per gallon (ca 1985-1986). What else could I get for $1.20? Well… I could get a double-cheesburger, an order of fries, and a drink. At least I THINK that’s what I remember paying.

Last week I paid $2.79 for a gallon of gas. I haven’t had a double-cheeseburger value meal lately, but I think they’re around $2.80.

This probably explains, at least in part, why Americans aren’t curbing their driving despite higher pump-prices. Or maybe it explains why so many of us eat at McDonalds.

62 thoughts on “Gas prices, Inflation, and Eating Out”

  1. The real question is, have wages gone up enough for the common man to offset inflation across this time period?
    Or has the average wage been shrinking in real world terms?

    1. There are two ways to “correct for inflation” you can correct for changes in wages, or correct for changes in purchasing power. I think that graph is using the former method.

      1. Good point. Back in 1985 I was making a hair over minimum wage, which was $3.35/hour. A gallon of gasoline was 36% of a minimum wage hour.

        That was in Florida.

        Today minimum wage in Utah is $5.15/hour, and gasoline is around $2.79/gallon (at least where I shop.) A gallon is therefore around 54% of a minimum wage hour.

        This statistically-flawed microsample proves that I know how to perform division.

        1. And what what I have read that comparison holds well for most commodities and incomes. The one exception being the group that you and I fall into, well educated white men. We are doing rather better, but really no one else is.

          1. Says you, to the guy who took an 80% cut in pay last year. 🙂

            But then all I’ve got is a bachelor’s in Fine Arts (Music Composition and Sound Recording Technology). Somebody was BOUND to find out sooner or later.

          2. I didn’t know you majored in Sound Recording. (I’m guessing this was when the Sound Recording major at BYU was one of those you had to design yourself.) That’s sort of my unofficial minor, since it’s now classified under the School of Music, and I didn’t pass the audition. Just finished the last class I can take in there without being a major, though. Ah well. C’est la vie. That final recording project was awesome, though. 🙂

          3. 3 books are good, but for novelty’s sake…

            If I’m ever at a convention at which you’re a guest, I have a CD liner I’d like you to sign. 😉

        2. On the flipside, I don’t know anyone that isn’t a college or high school student that is still making minimum wage…

        3. To refine it just slightly, minimum wage in FL now is $6.40/hr, and gas prices are about the same. Works out to about 44% of a minimum wage hour. Alright, so I’ve also proved I can do division.

          What a body really needs is to do the real wages comparison as someone else suggested. There’s a lot more money floating around, but at least some chunk of that has gone into growing the executive/worker pay gap from 40:1 to 400:1 in twenty years.

  2. McDonalds: Cardboard of Champions.

    I always figured McDs burgers were the nutritional equivalent of those hollow display TVs you see in department stores…

  3. Or maybe it explains why so many of us eat at McDonalds.

    I’m unable to come up with any explanation for “why so many of us eat at McDonalds” that doesn’t hypothesize pervasive subliminal advertising, post-hypnotic conditioning, or government mind-control rays.  The allegedly-edible product McDonalds serves is the most horrible crud I’ve ever seen passed off as matter fit for human consumption outside of the patient “food” at Columbia San José Medical Center, now thankfully closed (presumably in a desperate act of gastronomic mercy to the sick and injured of San José¹, though they passed it off as economic reasons) by the company that operated it.  It all tastes like cardboard, when it tastes of anything at all (the fries are usually completely devoid of either any discernable flavor or texture except for the outer crust), except for their coffee, which is the worst I’ve ever tasted.  Even Starbucks’ coffee only tastes burned, a minor offense by comparison.  I don’t think I’ve ever had a soda from McDonalds that wasn’t overdiluted by at least 50%, the fruit juice is watered down … somehow even their ketchup tastes bland.  The only thing that has the flavor it should have is the salt.

    I’ll grant, maybe I just have a talent for finding the worst McDonalds franchises in existence.  And I’ll also concede that the last time I committed the judgement error of eating anything at a McDonalds was about six years ago, and the time before that … uh … all I remember is it was at an airport, somewhere between 1990 and perhaps 1996.  And before that, maybe 198….2?  It’s conceivable they could have improved since.  (It’s also conceivable that Congress could truly have the best interest of the nation at heart … but I digress.)  But on the basis of every, uh, shall we say, menu item that I have ever consumed sourced from McDonalds, it continues to be a source of complete bafflement to me how on earth McDonalds ever achieved their market success.

    Clearly, for the salvation of humanity, someone must start up a chupaqueso chain to do battle with McDonalds.  (In the interest of common decency, their plan for taking over McDonalds’ sector of the fast-food market should probably rely heavily upon precision use of orbital lances.)

    [1]  If I hadn’t had friends and family bringing food in for me during the month I spent in Columbia San José, I’d have been suffering from malnutrition by the time I left, because so often the very first whiff of odor when I took the cover off the plate was enough to turn my stomach.  (Roast beef, for instance, should not smell like week-old locker-room laundry, nor should mashed potatoes taste like used dishwater.)  As it was, I was 165lb when I was admitted, and 130lb when I was discharged thirty days later.

    1. The only retort I can offer is “but I LIKE McDonalds.”

      Not all the time, and not even very much of the time, but sometimes yeah. And I don’t watch TV without my tin-foil hat, so the subliminals can’t be working on me.

        1. Chicken Nuggets: Everyone else’s chicken nuggets are better, but the sauces provided at mcdonalds are superior. Makes me want to buy a bucket of their BBQ sauce and take it to have wendy’s and BK nuggets.

          Cheeseburgers and double cheeseburgers: They’re cheaper than food. Really. They’re the largest burger for the price. The junior burgers and at wendy’s and BK are quite a bit smaller at the same price. Full sized burgers taste better from the other places, but these are good enough to be worth the $0.99.

          Big Mac: I don’t know why people buy these when they’re not on sale. They’re a $0.99 double cheeseburger with extra bread and mayo/thousand island/dill relish type stuff you can get at the store in a bottle labeled “Burger Sauce” for the difference in price between the two burgers. I only buy these when they’re on sale.

          1. That’s true, they did have a good selection of nugget sauces. If only you didn’t have to have their nuggets with it.


            Cheeseburgers and double cheeseburgers: They’re cheaper than food. Really.

            Yeah, but….. look what we’re saying here. 🙂

            If I’m stopping somewhere for a fast food burger (a rare occurrence in itself), I’ll like as not look for a Carl’s Jr., or a … uh … whichever chain it was that has the big star sign that I’m blanking on, unless in California, in which case I’ll see if there’s an In’n’Out nearby. (But the last time I went to In’n’Out, I was disappointed there, too.)

          2. You’re right, it is. I was thinking of Jack-in-the-Box in the first place, but conflated the two together. No wonder I couldn’t think of the name for the second chain, I’d already used it….

          3. Sure, when i have big $$$ in my pocket I’ll hit Goodtimes, Carls Jr, or get a triple cheeseburger at wendies. But when I’m grabbing lunch from work there’s no better $1 double cheeseburger than McDonalds. Half the time though I just go and buy 2 beef combo burritos from taco bell, $1.29 and they’re bigger than the double cheeseburger.

            We don’t have a Jack in the Box here, nor an In’n’Out, nor an Arctic Circle. We’re pretty much limited to McDonalds, Goodtimes, Sonic, Wendy’s, BK, A&W, Dairy Queen, and Carls Jr as far as fast food burgers go. Of those, the cheapest burger that is actually good is McDonalds. DQ, Sonic, A&W, and Carls Jr don’t have a $0.99 burger or if they do it’s minuscule. The ones from BK and Wendy’s are single burgers, not doubles. GoodTimes has good $1.25 burgers, but they’re also singles and they don’t take credit cards.

          4. I haven’t eaten anything from Taco Bell in so long I don’t remember what their burritos are like. I seem to recall them as OK, but not a standout in either direction.

            When I was studying custom sadlery in Spokane, the lunchtime roach coach used to have some giant red-hot chile colorado burritos that were OH so good. They weren’t handmade, they were commercial prepackaged stuff. But I’ve never seen them since. Best prepackaged burritos I’ve ever had. Meaty filling with no gristle or mystery meat, great flavor, nicely hot but not searing hot, just the right thickness of tortilla wrapping.

            (Unlike some of the supermarket burritos that have a tablespoon of filling inside half an inch of rolled tortilla… my wife bought a box of “Tina’s” chicken burritos from Costco a while back, planning to take them to work for lunch. Gad, they’re horrible. Multiple layers of thick, pasty tortilla wrapped around … maybe two tablespoons of some sort of greyish, viscid goo, with no visible chicken, or anything else solid, present and no discernable flavor. We choked down about three and eventually threw the rest out.)

          5. Also, the last time you ate their chicken nuggets was over 6 years ago?

            They’ve improved greatly in that time. I’d consider them a close 3th place as far as chicken nuggets go, with Wendy’s on top, followed by Chick’fil’A. The only downside with them now is that they make the crust so much larger than the meat. Both are good, but it looks like you’re getting more food than you actually are.

          6. We’ve bought nugget meals for our kids occasionally, but usually from Wendy’s. My wife likes Wendy’s, and most long trips she’s driving, so Wendy’s tends to be where we stop. I personally tend to rank them below I’n’O, JitB, CJ, KFC, probably about the same as Arby’s, but above Sonic/McD/BK. I’m not honestly certain I’ve ever eaten at a Chick’Fil’A, but i like their billboards about as much as I’ll ever like any great hulking eyesore. 🙂

          7. Carl’s Jr., in Florida is Hardee’s, or rather, it’s the other way around as I moved from Fla last year, to NM. Hmmm…green chile onion ring burgers…slaver…drool…

      1. Oh, incidentally ….

        ….did you see the article recently in which some outfit tested the protective qualities of the tinfoil beanie, and found that the classic tinfoil hat actually strongly amplifies many RF frequencies in government use? I don’t have a URL handy, but could probably find it. I thought it pretty amusing. 🙂

          1. Re: Oh, incidentally ….

            Hey! Radio-isotope protection into the bargain! Just the thing for those days when the weather forecast is for scattered nuclear bombardment. 🙂

    2. Actually, I have the opposite problem about their soft drinks. I usually go either there, Burger King, or sonic when I want a good, not-watered down soft drink because all of the other franchises miss more than they hit as far as good fountain drinks go. McD’s gets it right at least 80% of the time. Even sonic lets me down more often. I get flat cola from them WAY too often when they’re my primary vendor of flavored cola additives.

      Wendys is especially bad about that after they switched from Pepsi to Coke. I don’t think they recalibrated their machines properly. Same thing for Arby’s. Most of the gas stations around here have crummy coke fountain machines too.

      I need to get one of those tools that Coke uses to test the quality of their fountain drinks. Maybe we need more coke representatives to actually visit these restaurants and test them.

        1. I am. I can’t stand fountain lemonade ever since they took Country Time off the local machines. I don’t know what kind of tasty asbestos stuff they use in Countrytime, but it was addictive.

      1. I don’t remember Wendy’s EVER having PepsiCo products, either here, or in the Canada. Maybe it’s a regional thing for your area (or was)

        Frankly, I’m pissed off at Fuddruckers for switching to Pepsi – There’s only ONE decent Pepsi drink, IMO. That’s Mug rootbeer, and obviously, they don’t carry that at most stores, and definitely not the diet version.

        So if I eat there, I drink water. They lose that money. And I don’t eat there as much anymore. So they’ve lost that money too. And yes, I take the surveys and complain.

        Arby’s is owned by PepsiCo now, I think. Expect to see them switch to Pepsi sometime in the next 5 years, I’d bet.

        1. Arby’s switched to pepsi here about 3 years ago. Wendys was Pepsi here until about 3 years ago as well. Those are about the only two I can think of switching in recent memory.

          I can drink either, as long as it’s good. I prefer pepsi in bottles to cans, because pepsi cans are just too… acidic to me. Coke I prefer in cans because their bottled version is too bland. Fountain drinks are hit or miss for either, as I described above.

    3. The only thing I get (by preference) at McDonalds is their McGriddles. Quite tasty, and well-balanced flavorwise, even though I hate the ginormous amount of fat in them.

      1. Well, it’s not an unreasonable metric, even within different bits of the US. (The Big Mac is arguably the best thing they could have chosen — most everything else on the menu shifts around, since size definitions and combo meals for anything else are much more fluid. The Big Mac changes names in some territories, patty composition in others, and outright meat change in at least one, but it’s still recognizably intended to be the same-sized product in the same form factor.)

        1. (God, and last week I was explaining the mutable nature of Coke to another webcomics-type. Next week, I’m putting ten bucks on the failure modes of British Starbucks.)

  4. Looking at the graph, my first reaction is that inflation must have -skyrocketed- under Bush, considering how much flatter the inflation-adjusted graph is than the actual-price graph.

    1. Well, when you consider that going from nearly 0% to a hair under 2% is something fairly shocking percentage-wise, I guess you could say that. Absolute terms, not so much.

  5. What I never seem to hear taken into account is the number of people who can’t curb their driving because there are no other options available. I drive 25 miles to work each way, five days a week; there’s no public transportation available to get me to work, and I have yet (after several years of looking) to find anyone else I could carpool with (most of my co-workers are (and I say this with affection) local yokels, while I’m from out-of-town). I just get so frustrated when the economists point out that driving hasn’t gone down despite the high prices, when all I can respond is “that’s because I can’t!”

    Of course, what I can (and did) do is buy a motorcycle that gets twice the mileage of my car (which gets pretty fair mileage in and of itself – no SUV for me!). Now I just need to learn to ride the darn thing, and I’ll at least have the summer months covered…

    1. Amen.

      At least to the first part. I can’t drive a motorcycle.

      Anyhow, I too must drive to work.

      On the weekends, I don’t drive.

      I wonder who these folks are polling? If they asked me, I could name a good many of my friends who are walking, biking, and or not driving as much. Certainly I haven’t visited my family as much.

      1. Scooters

        Consider a scooter. They have automatic transmissions.

        There are several brands out there, and lots of engine sizes to choose from. Honda, Yamaha, Suzuki, Kymco. They start at 50cc and go all the way up to 650. I bought a Honda Reflex 250 last year (pictured in my icon) and I get over 65mpg. I commute two days per week (60 miles round trip).

    2. I’m even more extreme than you. When I go to work, it starts with a 2-hour drive to the airport from Fairmont, and there are no alternatives. None. I must drive it.

      Further, I need to have the range to make that 250-mile round trip on one fillup/charge/whatever. I can’t depend on plugging in an electric car at the airport parking lot.

      Not only that, but a hybrid would do me no good at all, since most of the trip is made at 70 MPH – where a hybrid is least efficient.

      Enviro-wackos who say that everyone can cut down don’t take my kind of travel into account at all.

      1. Some of those enviro-wackos have started beefing up the batteries in Hybrids (by adding a huge stack of batteries in the trunk) to increase the gas mileage on them, then you just plug the car in to recharge those batteries. Part of the benefits of an electric car and still having gas to fall back on.

        How is the gas mileage on your car? There’s numerous ways to improve gas mileage without going to a hybrid. 5 and 6 speed transmissions, cruise control, smaller and more efficient engines. I had a cheapo Plymouth Horizon (2.2l 4cyl with a 5 speed and a real mechanical rotary distributor) and was getting upwards of 44 miles per gallon on long trips with it. I paid $1300 for it 3 years ago. My dad had a 95 Saturn that we could get 53mpg with. (also non-hybrid.)

        1. Air up the tires, make sure your coolant and oil is up to snuff, and have the bearings checked regularly.

          I get about 30 MPG with my Pontiac Vibe, in heavy stop and go driving in Houston.

          BW

        2. My 2001 Lexus RX300 gets 20 MPG on the highway on crappy Minnesota pseudo-gas. (23 on real gas.) My current plans are to replace it in a year with a new 2008 RX350, which I expect to do a fair amount better. I use cruise control all the time.

          I will not, however, downsize the vehicle, for two reasons: 1) A smaller vehicle will not meet my mission requirements, which sometimes include hauling 4 people and a fair amount of stuff, or two people and a lot of stuff; and 2) A quieter vehicle is considerably easier to take long trips in than a noisier one, as I discovered when I traded in my previous vehicle, a 1996 RAV4, on the Lexus. I regard this as a matter of safety: the less tired I am after 12 hours on the road, the safer I am.

          1. I really like the RX400h, myself. The downside is the $7k premium you pay for the hybrid drivetrain, and at that the auto manufactures are still losing money on each one they build. Also, battery changes are no laughing matter, and they can come sooner than you think (worst case: less than a year, the vehicle had almost no use and was out in the desert sun the whole time). Of course, as was pointed out, hybrids do no better on mileage at highway speeds. That’s where the Europeans have us beat with their turbo diesels. The Jetta TDI is great, a friend of mine is reporting 600 range per tank, but what I crave is the BMW 5 series diesel I used in Europe. Great mileage, plenty of power, lots of room, and 40 mpg at 100mph on the autobahn

          2. I’d like a turbodiesel – as long as it does have significantly improved efficiency. The Jeep Liberty TDI doesn’t count, as it’s only rated at 26 MPG highway.

          3. Makes sense. I’m not sure how big those are though. Is it an Automatic? You always pay a small tax for the Torque converter on those automatic transmissions. Essentially a big chamber of fluid that transfers angular momentum through two discs spinning in the fluid. Quite inefficient. A CVT or a Manual will improve your gas mileage 3-5 mpg easily.

          4. The RX300 and the follow-ons, the RX330 and the RX350, are Lexus’s small SUVs. The RX300 was the first crossover SUV.

            There was exactly one vehicle in that class (small luxury SUV) with a manual transmission, when I was shopping in late 2000: the BMW X5. I looked at it, and what you gain in efficiency with its 6-speed manual is lost by having to carry around 700 more pounds with essentially the same engine. I don’t know if there are any others in that class now with a mannual. I’d prefer to drive a manual, as the two SUV’s I’d owned before the Lexus had them, but if it’s not available, there’s not much I can do about it.

          5. No M/Ts, but the Nissan Murano /FX35 has a CVT, as does the RX400h. You used to be able to get the 4 Runner V6 with a M/T (I did) but I don’t think you can anymore, and definately not with the V8. The MPG losses from an AT are not as bad as they used to be, technology has improved.

          6. Ahh, yeah that’s a problem then.

            Luckily there’s more options now. I’m currently driving a 25mpg car, but I’m likely to get into a 2008 Jeep Patriot or Jeep Compass once my payments are done on this car. They both get about the same gas mileage (because they’re CVT instead of automatic) but have better ground clearance and are just nicer all around. They’re considered mini-suv’s even though they’re built on a car frame.

  6. Cars can be made to be more efficient at higher speeds. Blame the car manufacturers for not doing this.

    McDonalds. Want to know what was behind their success?

    Marketing
    Similarity
    Training
    Ingredients

    Marketing – they’ve always had good advertising and marketing. Ronald McDonald is one of the most well known icons out there.
    Similarity – the food is the same at virtually every McDonalds across the globe. When you walk into a Mickey D’s, you know what you’re going to get – which is better than most “fast food” in Paris, for example.
    Training – McD’s has always pushed VERY hard for similarity of training, even to the point of having their own management training center, to try to make sure that all of the stores are run the same way. Everything is boiled down to step by step instructions by need and function.

    Ingredients – Everyone laughs at this one, but it’s true. You _know_ what’s going into the food. They don’t slip exotic substances into the meats (Texas Burger does this), they don’t play games with sides, and so forth. Yes, they have the ‘mystery sauce’, but that’s about it. Their primary seasonings are salt and pepper. If you have problems with food allergies, for example, you can’t get much better than finding a McDonalds when you’re hungry. A ‘plain’ hamburger is beef, salt, pepper, and white bread. A ‘plain’ filet ‘o’ fish is cod? pollock? (something like that) that has plain breading, salt, pepper (at most), and white bread.

    I will say this. I like their hot mustard dipping sauce. I use it with the fries. Their nuggets, on the other hand.. are terrible. Reconstituted coloured sponges. I always expect to see someone’s jaws bounce when they bite into it. If you throw one, you’d probably get two ricochets. Chik-Fil-A has the best nuggets 🙂 (but lousy sauce. What is it with “Honey Mustard”. It’s Honey sauce with a slight bit of mustard flavouring. That’s it. Call it “Zesty Honey” if you want, but quit using “mustard”. I want MUSTARD Mustard.)

    BW

    1. Chick-fil-A definitely has the best meat in their nuggets, but they’re sooo small.

      Wendies is somewhat better all around because they’re larger and have less greasy breading on them.

      McDonalds nuggets… Really I only put them third because there’s only 4 places in my area that serve “chicken nuggets” and the 4th one calls them “chicken tenders” and makes them all kinds of wierd shapes. Their bbq sauce sucks too. The sponginess you mentioned is likely the same thing I said about their nuggets being mostly air. The breading is really loose around the chicken so it bounces back. The meat itself has improved though with going all white meat, but it’s just another pressed and formed food bit.

      They’re pretty close to each other though really.

      As far as similarities… I walk into a McDonalds in the Vail area and get serious sticker shock, but other than that it’s the same. Vail is about as close to a foreign country as you get in colorado, aside from maybe Aspen. (Aspen could be a foreign planet.)

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