- Associated Press - Sunday, June 4, 2017

CLARKSBURG, W.Va. (AP) - Ned Reneau, 97, of Grafton, remembers raising nine children on a salary of about $350 a month in 1967. That paycheck would be equivalent to $2,570 a month in today’s economy, according to the U.S. Bureau of Labor Statistics inflation calculator.

Reneau was employed as the chaplain at West Virginia Industrial School for Boys, which was located at Pruntytown at the time.

“I worked there until 1983 when they closed it. We drove a Ford station wagon and our house payment was about $125 a month,” he said. “My benefit package included a regular salary, state retirement and social security.”

Health care coverage was not a part of his compensation.

“We had our own family physician. Five of the children were born at Grafton City Hospital. Most of our doctoring was done here in town. We had to take care of all medical costs with our own income. We had the children taken care of. I personally have been in pretty good health,” Reneau said.

Some people believe the cost of living was much cheaper 50 years ago, but economists say that is not necessarily correct and it is a complicated issue to determine.

The Reneau family had cable television and a home phone at that time, but it was so much different than the options there are today.

“It’s considered a part of living now, but it was a luxury then. Television stations were provided by a local cable guy. You didn’t have many channel choices. Our phone in Pruntytown was part of an eight- to 10-party line. They gradually cut that down and eventually we got a ‘private’ line,” Reneau said.

But, one thing that hasn’t changed much is that major purchases, such as kitchen appliances, vehicles or cars, are paid for “on time,” or with credit.

Reneau and John Deskins, director of the Bureau of Business & Economic Research in the College of Business & Economics at West Virginia University have similar ideas on whether it is more expensive to live now or then.

“The key issue is overall salaries will rise with inflation,” Deskins said. “An inflation fallacy is that it makes stuff more expensive. Not all incomes are rising at the same rate. Wages for people with only a high school diploma have not kept up with inflation. Those with a higher degree have more buying power over time. There are differences across households. Overall, wages will keep up, depending on the career category.”

Reneau said every time they got a raise in pay, there was an increase in expenses, such as food, clothing or rent.

“Our first house payment was $60 a month in about 1960. The first house we bought was for $10,000. We built our first house for less than $20,000. Now that house is listed at over $100,000. You have to raise salaries to pay for it. That raises the cost of living.”

Tom Harrison of Lumberport had just graduated high school in 1967.

“It was my first year actually working before starting college,” he said. “I drove a 1959 Chevrolet that I purchased for $175.”

Harrison worked at a warehouse in Lumberport and made $78 a week.

“Not long after that, I went to Fairmont State College. Tuition was $128 a semester. I graduated in December 1973,” he said. “I remember we only had one computer terminal at college for students. You had to schedule time on it, which wasn’t always easy.”

Harrison believes the cost of living is higher now, but he adds a caveat.

“Everyone seems to have a lot more today. Everyone was satisfied with what they had back then,” he said. “People spend more of their income on entertainment and other items than they used to. My grandson had on a $300 pair of tennis shoes the other day. I told him I used to have hand-me-down shoes with cardboard in them.”

Harrison recalls his dad being laid off a lot at Pittsburgh Plate Glass and having to work two jobs lots of times to raise six children.

And, nearly everybody read the daily newspaper to find out the latest local, state, national and international news. It was also how they hunted for bargains, unlike today when people go straight to the internet for cost comparisons, both locally and globally.

The Clarksburg Exponent advertised a brand new Camaro or Mustang at approximately $2,500 in 1967. The purchase price today is more than $25,000.

A Bureau of Labor Statistics Consumer Price Index inflation calculator shows that $2,500 then has the buying power of $18,358, which means that vehicle prices have outpaced inflation, at least with this muscle car.

Some new cars can be purchased for about $18,000, showing that not all automobiles have outpaced inflation.

Bryan Lego, research assistant professor with the WVU College of Business and Economics, cautions people against making direct comparisons with vehicles because so many things have evolved with safety features, technology and taxation.

Household goods have remained somewhat steady as technology has improved.

A 10,000 BTU air conditioner cost $179 back then and about $300 now. With inflation calculated in, $179 is worth $1,322 today.

A self-cleaning oven was about $250 five decades ago and can be purchased for about $500 today. A no-frost, 16-foot refrigerator would run you about $300 then, and is available in a range of prices today from $450 to $1,500. Dishwasher prices have doubled from about $150 to $300 in 50 years.

Deskins said there was a big inflation spike in the 1970s and 1980s. The consumer price index remains a reliable tool in determining the cost of living.

“In fact, Social Security is determined on the consumer price index,” he said.

The Bureau’s consumer price index average for all items shows that over the past 50 years, the years 1982-84 provide the base period for $100.

A 1967 consumer would pay $33.40 for that same item. Twenty years later it would cost $113.60. Those goods had a price tag of $160.50 in 1997 and today would cost $243.80.

“There has been an evolution of costs. Services, personal and entertainment costs are much more than they were 50 years ago, when they focused on durable and nondurable goods,” Deskins said.

Reneau said his family certainly did not spend a lot on entertainment, vacations or dining out back in 1967.

“Back then, we spent more of our income to make ends meet, rather than things to do. If we were going to visit our family out-of-state in the summer, we would load up the car with everyone and food and stop at the parks. We tried to eat one meal a day at a restaurant during the trips. It was cheaper and it gave the kids a chance to run off some energy at a roadside park. We’d also take breakfast food if we were going to stop somewhere overnight. We’d fix breakfast at a roadside park and get back on the road.”

Some categories are very difficult to analyze - such as health care and landline communication.

“Government, regulation by insurance companies and an aging population all affect the way the health care industry operates. The baby boomers are entering the golden years and all that impacts the industry,” Lego said.

While landline communication is a diminished percentage of an individual’s budget at home, the way the industry is organized is dramatically different, he said.

“You had a one-company monopoly back then. We have a number of wireless services to select from now,” Lego said.

Some things have actually gone down in price when adjusted for inflation.

“Food prices are a significant example. A lot has to do with the variety of trade agreements internationally that we have today, that were not available then,” Lego said.

That may not be the case for Tim Baker, 26, of Bridgeport. He is single and dines out a lot, spending more of his disposable income on food.

Employed in retail sales, he makes about $41,000 annually, which equates to a salary of $302,884 in 1967 when factoring in inflation.

Baker has a mortgage payment of $780 on a $118,000 home. He also is paying for a 2015 Chevrolet Silverado with $630 monthly installments.

“I spend most of my disposable income on internet, premium cable, subscription streaming services and concerts,” said Baker, who hasn’t had a landline phone since 2005. “Our generation has been raised to live in debt. And, many borrow above their means. I believe too much emphasis is placed on credit ratings. It impacts everything you do.”

While his employer provides health care, Baker doesn’t utilize it much at his age.

“Health insurance is vital. But, I only use it for illness, and not preventative reasons,” he said.

Baker said the cost of living 50 years ago was much less than it is today.

“When someone built a house back then, they probably did it themselves, using a local business and family and friends to help him. Now you go to the big box store. And there are more layers of bureaucracy in purchasing a home today. There is always a middleman and government fees also factor into the price.”

He said couples today can’t afford large families.

“It costs $70,000 to put one child through college,” Baker said.


Information from: The Exponent Telegram, https://www.theet.com

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