Gas For Less Than 25 Cents Per Gallon ! Gold Standard


Yes, believe it. Currently gas can be bought for less than 25 cents per gallon. In fact, gas prices today are really not at near record highs but actually…near record lows.

You may all think that I have gone mad, but let me show what I am talking about. When we look back at historical gas prices, they hit an all time low of around 17 cents per gallon during the depression in 1931.

During the period of 1920-1970 gasoline typically cost around 30 cents per gallon. It was not until 1971 when President Nixon took the US dollar off the gold standard that gas prices began rising. Today if you had a quarter that was minted prior to 1965, when money was still made with silver, that quarter is worth more than $8.00 in today’s dollars- more than enough to buy 2 gallons of gas with that single 25 cent piece. Gasoline is getting more expensive but the real story is that our dollars are losing purchasing power and we need more of them to buy the same gallon of gas that our parents and grandparents bought decades ago.

Dig out those old quarters everyone…each one will buy at least 2 gallons of gasoline today. Even an old dime will nearly buy an entire gallon.



Average Cost Of New Home Homes
1930 $3,845.00 , 1940 $3,920.00, 1950 $8,450.00 , 1960 $12,700.00 ,
1970 $23,450.00 , 1980 $68,700.00 , 1990 $123,000.00 , 2008 $238,880 , 2013 $289,500 ,
Average Wages
1930 $1,970.00 , 1940 $1,725.00, 1950 $3,210.00 , 1960 $5,315.00 ,
1970 $9,400.00 , 1980 $19,500.00 , 1990 $28,960.00 , 2008 $40,523 , 2012 $44,321 ,
Average Cost of New Car Cars
1930 $600.00 , 1940 $850.00, 1950 $1,510.00 , 1960 $2,600.00 ,
1970 $3,450.00 , 1980 $7,200.00 , 1990 $16,950.00 , 2008 $27,958 , 2013 $31,352 ,
Average Cost Gallon Of Gas
1930 10 cents , 1940 11 cents , 1950 18 cents , 1960 25 cents ,
1970 36 cents , 1980 $1.19 , 1990 $1.34 , 2009 $2.051 , 2013 $3.80 ,
Average Cost Loaf of Bread Food
1930 9 cents , 1940 10 cents , 1950 12 cents , 1960 22 cents ,
1970 25 cents , 1980 50 cents , 1990 70 cents , 2008 $1.98 , 2013 $2.79
Average Cost 1lb Hamburger Meat
1930 12 cents , 1940 20 cents , 1950 30 cents , 1960 45 cents ,
1970 70 cents , 1980 99 cents , 1990 89 cents , 2009 $3.99 , 2013 $4.68 ,
Some of the above can be explained due to the inflation over 70 years , but there are also many other reasons why some prices increased dramatically ( Housing Bubbles. Middle East Wars, Weather problems causing food price inflation, Population explosion, ) it also can work the other way due to improvements in technology offering much cheaper goods for example TV’s, Calculators, Computers ETC.


Gas prices are spiraling through the roof like never seen before. People often point to specific years that gas was so cheap, in an effort to blame politicians, Big Oil, or whomever else is the flavor of the day. Indeed, a gallon of gas was going for only a quarter of a dollar in the years after World War I, and even less than that before and after World War II.

A 1920 Standing Liberty Quarter could buy you more than a gallon of gas for most of the years after World War I until after World War II.

But the key fact that’s missing from all the ranting and raving is the rate of inflation. The simple definition of inflation according to Wikipedia is: “A rise in the general level of prices of goods and services in an economy over a period of time.” Keep in mind, that at the end of World War I, average annual income was only $1,500. Currently, annual income is around $50,000.

For this exercise I plotted various sets of data in graphs — sometimes combined — based on information compiled by the U.S. Department of Energy’s (DOE) statistical office, the Energy Information Administration (EIA). The purpose of this two-part segment is to provide a clearer understanding of how much the price of gas has actually gone up relative to a family’s budget and other household costs, and most importantly, during what time frame.


If you look at a raw chart of the price of gas, and how much it has gone up since 1919 (the first year of available EIA statistics), it does indeed look scary. You can see a low of $0.17/gallon in 1931 rise all the way up to $3.53/gallon in 2011.

Annual gas prices. 1919-2011.

But when the prices are adjusted for inflation, a much more balanced picture takes shape — although the spikes and drops are drastic. When taking inflation into account, average annual gas prices (in 2012 U.S. Dollars) were $3.35/gallon in 1919, $3.20/gallon in 1934, $3.44 in 1980, $2.49/gallon in 2009, $2.90/gallon in 2010, and $3.57/gallon in 2011. So it’s not like we’ve never seen this level of prices before.

Annual gas prices adjusted for inflation 1919-2011. Cost in Feb. 2012 U.S. Dollars.

The next chart plots the course of the Consumer Price Index along the same timeline as annual gas prices adjusted for inflation. What you see — for the most part — is that from the early 70′s until the late 90′s and early 2000′s the price of gas actually dropped relative to the rising CPI. The drastic spike in gas prices in the most recent decade, along with only a moderate rise in the CPI — is the real story, which we will get into in the next set of charts in Part II.

Annual gas prices and Consumer Price Index 1919-2011. Cost in 2012 U.S. Dollars.

The next chart merges the first and third charts, showing the CPI, nominal gas prices and inflation adjusted gas prices in 2012 U.S. Dollars.

Just for the fun of it, another interesting way to look at it is from the standpoint of 1919 U.S. Dollars. For this I calculated the value of 1919 dollars versus subsequent years and then plotted the price of gas accordingly, as if the CPI never changed. The chart below shows how much Americans were paying for gas if there was no inflation since 1919.

Annual gas prices 1919-2011. Cost in 1919 U.S. Dollars.

In Part II of this segment, we will zoom in to take a closer look at the ballooning of gas prices in the last decade and examine how much more it has spiked than the rise in the CPI during the same time period.

Nixon Took Us Off the Gold Standard

President Richard Nixon’s taking America, and the world, off the gold standard, making many promises that were promptly broken. (For instance, President Nixon promised that the dollar would retain its full value. It only is worth about 19 cents today of what it was worth in 1971.)

There’s a little known twist. And as the late Radio Journalist Paul Harvey, master of the unexpected twist, would have said, “now you know the rest of the story.”

President Richard Nixon famously resigned the office of the presidency in the face of certain impeachment and removal from office. The charges were based in the infamous burglary of the offices of the chairman of the Democratic National Committee in the Watergate complex and, more specifically, of the ensuing alleged cover up.

America was transfixed for months by televised hearings presided over by the colorful Sen. Sam Ervin. We were treated to spectacles such as the discovery of The Tapes, the “Monday Night Massacre” resignation of the Attorney General and high Justice Department officials. We learned about the mysterious insider, pornographically code-named “Deep Throat” murmuring intriguing clues like “Follow the Money….”

It was a media circus.

But barely remembered, even by those of us who lived through that era, it also was a time of really serious, and in many ways unprecedented, inflation. And inflation causes a kind of societal uneasiness … uneasiness that easily can create a toxic political climate.

John Maynard Keynes, the famous economist, once wrote, in “The Economic Consequences of the Peace”:

“There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.”

Some presidents have such reservoirs of good popular will that, even if caught out, they can survive intact even impeachment by the House of Representatives. William Jefferson Clinton, notwithstanding certain misbehavior certainly unbecoming of his high office, was so esteemed for the prosperity his free trade, welfare reform policies had engendered that he was able to weather impeachment and achieve acquittal.

But not Nixon. Why might that be? It was almost as if he were hexed. Was he?

Thomas Paine was the visionary, and some might say prophet, who precipitated the American Revolution and in his continuing writings gave it inspiration, direction, and meaning: liberty, dignity and integrity. Paine is remembered for writing phrases such as “These are the times that try men’s souls,” and “Tyranny, like Hell, is not easily conquered.”

Paine also wrote an almost unknown tract 1786 collected as “Dissertations on government, the affairs of the bank, and paper money.” For example:

“Gold and silver are the emissions of nature: paper is the emission of art. The value of gold and silver is ascertained by the quantity which nature has made in the earth. We cannot make that quantity more or less than it is, and therefore the value being dependent upon the quantity, depends not on man. …

“Paper, considered as a material whereof to make money, has none of the requisite qualities in it. It is too plentiful, and too easily come at. It can be had anywhere, and for a trifle.

“Money, when considered as the fruit of many years’ industry, as the reward of labor, sweat and toil, as the widow’s dowry and children’s portion, and as the means of procuring the necessaries and alleviating the afflictions of life, and making old age a scene of rest, has something in it sacred that is not to be sported with, or trusted to the airy bubble of paper currency.”

Paine savagely indicted paper money.

“It was horrid to see, and hurtful to recollect, how loose the principles of justice were left, by means of the paper emissions during the war. The experience then had should be a warning to any assembly how they venture to open such a dangerous door again. …

“But the evils of paper money have no end. Its uncertain and fluctuating value is continually awakening or creating new schemes of deceit. Every principle of justice is put to the rack, and the bond of society dissolved. The suppression, therefore, of paper money might very properly have been put into the act for preventing vice and immorality.”

Paine called for the strongest penalties for an official who might connive at going off the gold standard:

“As to the assumed authority of any assembly in making paper money, or paper of any kind, a legal tender, or in other language, a compulsive payment, it is a most presumptuous attempt at arbitrary power. There can be no such power in a republican government: the people have no freedom — and property no security — where this practice can be acted: and the committee who shall bring in a report for this purpose, or the member who moves for it, and he who seconds it merits impeachment, and sooner or later may expect it.”

“… [M]erits impeachment, and sooner or later may expect it,” wrote the prophet of the American Revolution.

And now you know the rest of the story. If only Richard Nixon had credited Paine’s prophecy and left the gold standard in place he might have finished out his second term and left office with his dignity intact.