74 cents a gallon? Wow!

When considering inflation, the 1976 USD was worth $.27 to a 2006 USD.

A $.39 increase/gallon in 1976 in today's USD's converts to a $1.44
increase.

And you were saying?


Let's focus on what you're saying, or at least making an attempt to say.
You either don't understand the concept of reduced purchasing power due to
inflation, or have difficulty explaining it. A 1976 dollar was worth more
in terms of purchasing power than a 2006 dollar. The exact opposite of the
way you stated it.

The Consumer Price Index was established in 1967, which shall be referred to
as the base year. The CPI index for the base year is 100. The value of the
index as of March 31, 2006 is 578.86, the latest statistic available. The
index value for 1976, the year of comparison in this thread, is 170.5.

This means that a 2006 dollar is worth only $.1728, when compared to a 1967
dollar (100/578.86). This also means that a 2006 dollar is worth only
$.2945 when compared to a 1976 dollar (170.5/578.86). Therefore, it can
also be said that a 1976 dollar was worth 3.4 times what a 2006 dollar is
worth (578.86/170.5) in terms of purchasing power.

Therefore, your calculation of a $.39 increase/gallon equating to a $1.44
increase in today's dollars is a bit overstated. The true math equates $.39
to $1.33 ($.39*3.4). However, this seems like an odd way to examine the
situation. Why not just compare the cost of a gallon of gas then versus
now, in terms of inflation adjusted dollars? A 1976 price of $.74 per
gallon, after the mentioned increase that year, was offered in an earlier
post. I'm not sure if that number is 100% accurate, but I have no quarrel
with it. Using that 1976 value, and the CPI data offered above, that means
that a gallon of gas today should cost $2.52 per gallon ($.74*3.4), if gas
was to have increased in price commensurate with the CPI. The only
conclusion that can be drawn from this is that the cost of gas appears to
have risen slightly higher than the aggregate cost of living when using 1976
and 2006 as your goalposts in time, a conclusion I don't find particularly
profound or shocking. Actually a bit of a bore, not really amounting to
much. Not entirely unlike yourself, Jim. Using any different slices of
time for comparison would likely yield different conclusions, or at least
those drawn about the cost of gas.