First: I am not advocating the use of fossil fuels. I believe we should continue the search for and development of renewable sources of energy that are economically feasible and environmentally responsible.
Second: I am not an economist. Read at your own risk and seek out alternative sources of data.
Last week, I shared an article from the Ludwig von Mises Institute by Sterling T. Terrell that related the historical price of gasoline compared to today’s prices. That article spurred me to do some armchair research on the U.S. price per gallon of gasoline versus U.S. median income.
According to the U.S. Census Bureau the median income in 1950 was $2,570 for men & $1,017 for women. The average price of a gallon of gasoline in 1950 was $0.27. That equates to .011% of total income of males and .028% for females. In 2006, the median income for men $32,265 and $20,014 for women. The current price of gasoline (U.S Average) is $3.50 per gallon. That equates to .011% of total income for males and .017% for females.
So the net-net on gas prices to median income pans out to be flat.
I decided I had better run my data through CPI calculator to adjust for inflation. The median income in 1950 adjusted for inflation was $18,381 for males and $6,816 for females. The price of a gallon of gas in 1950 adjusted for inflation was $2.39. That equates to .013% for men and .035% for females. When adjusted for inflation the net-net shows an ever so slight decrease.
Notes: I couldn’t find a reliable source for disposable income numbers from 1950 to present to validate the data against. Also, this data doesn’t take into account income gaps, for instance I don’t have a handle on the percent of the population at the bottom that have the least amount of disposable income.
Median Income: U.S. Census Bureau