That's a question for which the Federal Reserve Bank of Minneapolis has an answer. They have introduced a Consumer Price Index Calculator. I tried an example:
If in 1974, I bought a gallon of gasoline at $0.99 (and I remember the shock of it going into three digits back then), then in 2007, the same gallon of gasoline would cost... $4.13. I remember when Dom was talking about the price of gasoline a while back, how when adjusted for inflation, it was actually cheaper now. And when increased fuel efficiency is taken into account, the present situation is looking even better.
I tried another one. When I first came to DC in 1980, my starting salary was $12,266, and it was just enough to support myself, living in a high-rise efficiency at $290/month. Were that episode to occur this year, I would appear to require $30,590, and that same apartment would run for $725/month. Theoretically.
But in fact, I'd be lucky to get it for under $1000. That's when the news gets bad.
The last time I bought a house was in 1983, for $86K. It should have sold in 1991 for just under $118K, but in fact it sold for $140K. In 2007 -- again, using only the cost of living as a guide with 1983 as a base -- it should cost just under $178K. In fact, even with the housing bubble deflating steadily around town, I would still be paying at least $250-300K.
I guess inflation isn't everything, is it? There is still that nagging problem with the issue of affordable housing. At this writing, the next installment on that subject is very much in preparation (with a lot of details to organize, you know?), and it should be up this week, or early next week at the latest. Stay tuned...