prices are a great way to gauge how much weve being gouged
by the private banks that control (and relentlessly devalue) the
currency of the United States. But were also being gouged
by the government and those costs are even more hidden.
Let me explain
by way of example:
In the latest
issue of High Performance Pontiac magazine (Im a subscriber)
there is an article about a restored 1977 Trans-Am. The base price
of this car in 77 was $5,799.
Using the CPI
inflation calculator (see here) youll discover this sum has
the same buying power today as $21,785. To parse this in terms of
the real cost increase of a new car (as opposed to merely the increased
number of notes one must have in ones pocket today
to match the buying power of $5,799 in 77) it is instructive
to take a look at what this sum will buy Now vs. Then.
back in 1977 $5,799 ($21,785 in todays money) would
buy you a brand-new Trans-Am. Not merely a Firebird. The
Trans-Am was the top-of-the-line version of the Firebird
and also one of the most expensive Pontiacs at the time. For another
$75, a buyer could select the optional high-performance 400 cubic
inch engine and with it, a close-ratio manual transmission. Add
$281.76 for that (in inflation-adjusted 2012 dollars).
for a 77 Trans-Am with the optional high-performance 400 engine
and manual transmission: $5,874 in 1977 the equivalent of
step into a Chevy showroom and see what $22k (the equivalent in
real purchasing power of $5,874 in 77 money) will buy:
A base model
Well, not quite.
The 2012 base
model Camaros sticker price is $23,280 so about $1,200
higher in inflated 2012 dollars (about $320 higher in 77 dollars)
than the cost of a top-of-the-line Trans-Am equipped with
the optional engine (a big V-8) back in 1977.
The more direct
cost comparison is to compare the cost of a current V-8 Camaro SS
to the cost of that 77 Trans-Am. And how much is a new Camaro
SS? $32,280. In 77 money, thats equivalent to $8,592
and change. So, the real cost of a modern version of the 77
V-8 muscle car is about $2,800 more which doesnt sound
like a lot until you put it in terms of inflation-adjusted 2012
to about $10,520 and change. Not including interest on the loan.
not inflation. Its the cost of government. For
things like driver and passenger side airbags, tire pressure monitors,
traction/stability control and all the rest of it plus more
to come, including the just-mandated back-up cameras that every
new car will be required to have beginning with the 2014 model year.
Those costs are fairly easy to quantify; dual air bags, for example,
add an estimated $800-$1,000 to the bottom line cost of every new
car. Assuming the lower figure $800 that comes to
about $212 in 77 money or about three times the cost
of the 77 TAs optionally available high-performance
V-8 and manual transmission! Which would you rather have?
A pair of air bags in a V-6 base model Camaro? Or a big (6.6 liter)
V-8 and close-ratio manual transmission instead?
the rest of the article
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columnist and author of Automotive
Atrocities and Road Hogs (2011). Visit his
© 2012 Eric Peters
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