Country Facts and Folklore
By Andy Reddick

DEPRESSION PRICES

A record number of Americans were without work during the Great Depression. Banks failed, less money was in circulation, farm production and prices were at very low levels, and people with commodities for sale had difficulty marketing them as clients either didn’t have money to spend or were afraid to part with their money. Few people actually remember the depression, although we are constantly reminded that then nearly all commodities could be purchased for a fraction of today’s cost.

During the past 70 years, the lifespan of people in the US has increased from 59 to 79 years. As a result, people work many more years of their life time, although the average work week has dropped from over 50 hours to just 33, and people enjoy a longer period of retirement. Unemployment has dropped from 15% of the work force in 1933 to about 5.4% in 2005.

I recently ran across a comprehensive list of 1933 prices in Waterloo, as published by the Waterloo Daily Courier, and I have attempted to make a comparison with today’s prices wherever possible. Research and field work were required to complete this project, but the results are fascinating and worth the effort.

For example, a new International Harvester 1/2-ton pickup truck cost $360 in 1933. The least expensive new cars ranged from $300 for Ford, $395 for a Willys 77, $445 for a Plymouth 6, $585 for a Pontiac Roadster, $595 for a Dodge 6 and $665 for a De Soto 6.

On the Internet I found that a 2005 GMC Canyon Pick-up truck is $16,025. A Ford Focus 4 cylinder car begins at $13,005; a Dodge Caravan V6 is $18,330, a 4 cylinder Pontiac Vibe is $16,915 and a Cadillac CTS V6 is $30,365. What this means is that the cost of any new vehicle, whether it be a little pick-up truck or a sedan loaded with gadgets has increased at least 50 times in price since 1933!

Below is a list of jobs/careers and the salaries of 1933 compared with 2003:

*from 2005 World’s Almanac (2003 listing) & current classified advertising (most are beginning salaries)

The average working person makes 20 times what the average worker made in 1933! However, he pays federal taxes, social security taxes, state taxes, has deductions for health plans and dental plans, so that net take-home pay is only 15 times higher than in 1933.

For matters of comparison, the 2003 dollar was worth only 7 cents when compared with the 1935 dollar! However, the economy of the nation has totally changed in 70 years, thus it is sometimes difficult to compare values.

“The good old days” really were sometimes bargain days for those that had a job. New cars today are 50 times higher in price. Other comparisons, though, will reveal some surprising results with many items now days available at bargain prices:

Gasoline was 9 cents per gallon at some stations in 1933. Recently at Hy-Vee in Mt. Pleasant, gasoline sold for $1.52 gallon. Thus gas is now at least 17 times higher.

At the plush Hotel Taft, Budweiser beer sold for 10 cents and a dinner of creamed chicken, mushrooms and asparagus tips was 90 cents. Such a lunch in a nice hotel has only jumped about ten times to $9, while the beer is at least twenty times higher in price.

In New York, at Saks Fifth Avenue, boys’ plus-four knickers were $2/pair, and knicker suits were $4.95. Men’s suits were $37.50 and white buckskin shoes were $5. In 2005 Saks Fifth Avenue do not advertise children’s clothing. A pair of suede men’s loafers is $255 (up 51 times,) dress shirts start at $48, trousers at $165 and blazers $495, so as to make a sport suit ($660,) some 18 times higher in price.

Farmers were hit hardest during the depression. Net income in 1933 was 1/3 what it had been in 1929! Farmers got 2 cents/quart for milk, corn sold for 8 cents/bushel, and hogs were 2 cents/lb. Many formers burned corn for fuel because they couldn’t afford coal.

Those were the days of “Ten Cent Farm Sales.” If farmers couldn’t pay their mortgages or their taxes, farms were repossessed and sold at public auction. Neighbors would congregate and bid everything at ridiculously low prices (ten cents for mules or horses, a nickel for a plow, $1/acre for land) and outsiders were rudely persuaded not to outbid them. Then the property would be given back to the farmer as neighborhoods stood together to withstand the crisis.

Results of this study are that since workers earn about twenty times what they did seventy years ago, and the average net take home pay is at least fifteen times greater, then prices should now reflect that difference. If you can buy an item for less than fifteen times what it cost in 1933, you are now getting a bargain. Obviously then, items that now cost more than 15 or 20 times their former value are no longer bargains. A close examination reveals almost as many bargains today as there were 70 years ago!

- -
Contributed to the Van Buren Co. IAGenWeb Project by Andy Reddick
http://iagenweb.org/vanburen/