CPI changes

[Fred W. Schneider III]

Jim Holland wrote:

>
>         Honestly, I am on bended knee begging your forgiveness for even
> mentioning anything about inflation!  I was just trying to put things
> into a tiny bit of perspective.

Please, Jim.  This is not a topic to let drop.  Keep it rolling.  You jumped,
inadvertently, on a very good topic.  You were trying to put things in a tiny bit
of perspective.  You were simply trying mental gymnastics of comparing transit
costs to real estate costs.  That is not an unusual response. You were trying to
make a simple comparison. True.  Your thoughts simply needed more refinement but
you were leading us in a good direction and it can be the subject of perhaps a
wonderful display for trolley museums.  Read on.

Frankly Jim, a couple of the most interesting books I've seen in recent years
detailed Mervin Borgnis's exploits as a motorman in Allentown and Philadelphia.
They picked up a topic that no one else has tried.  They told about what it was
like to work for a living on a front platform.

No one, however, to the best of my knowledge, has traced how motormen and
conductors, and other transit employees lived, both on and off the cars. And I hope
you'll consider running with the ball I will throw out in the last paragraph.

  John Swindler worked since the 1970s in public transit at an administrative
level.  I worked in labor statistics until I retired in March.  We often compare
notes, and not just on this wire ... we talked at length last night. John is
incredibly knowledgeable about the lunacy of government funded transport. My
favorite story was his about a transit executive preparing for a board meeting by
watching Three Stooges comedies ... it was saying that business reality has no
place at all in transit any longer.  Because of the operating subsidies and capital
grants, and increasing inefficiency, transit costs have increased 50 times while
the CPI has gone up 7 times since 1950.  This is critical to our understanding.
And I'm glad you did open the door.  More of us need to recognize what has
happened.

I can give you some very quick comments on how we measure inflation.  Let me give
you some background on the Consumer Price Index.  Its important because of all the
wage packages and retirement links to it.  Trying to make cost of living
comparisons over time can be a real problem because the CPI is calculated using a
standard market basket ... so many eggs, so much beef, so much chicken, a certain
percentage for owned housing and another percentage for rented housing, and on, and
on, and on.  The trouble is the market basket changes in response to changes in
inflation, and the Consume Price Index simply cannot easily measure those changes
on a month to month basis.  The Bureau of Labor Statistics attempts periodically to
change the ratios of different components but there certainly is some statistical
error built into that.  We can say, hypothetically, that the CPI went up 2.5
percent in the last year but if 50% of the increase was in one component, people
will adjust, and because of that adjustment, their actual living costs did not go
up 2.5% because they didn't have the money to spend on the increase.  Only the
model went up 2.5%.  The consumer actually took steps to change the make up of
his/her market basket.  If orange juice changes drastically, people will drink
tomato juice.  And so forth.  By the way, taxes are not figured into the CPI.

We have CPI data back to 1913.  Trying to make comparisons over that period are
problematic at best, and they get worse the farther back we go.  It might be more
important for many of us to have a picture of what was in the market basket each
year back to 1913.  I, personally, do not know if BLS even has all that data ... it
may be just the CPI numeric output chart that we have.

And the farther back we go, the worse those comparisons become.  If you try to make
comparisons in income and expenses between today and how people lived in Colonial
times, it doesn't work.  We know how many pounds, shillings, and pence Virginia
townspeople in Williamsburg had in 1765, but it becomes incredibly difficult if not
impossible tracking that and consumption components up to today.  It is sometimes
much easier to say that, for their pounds, shillings, and pence, they worked 16 to
18 hours a day and they had unairconditioned frame houses, brick foundation, dirt
basement, outhouse for a toilet, chamber pot in the bedroom for use at night,
candles, pewter, no hospitals, no refrigerators, three chickens, a hog, a horse,
and so forth.

One of the more common questions I've been asked at both the Baltimore Streetcar
Museum and at the Pennsylvania Trolley Museum is, "How much did it cost to ride?"
Its a very logical question, but simply saying 5 cents in 1902 doesn't give them
any understanding at all. The usual response is, "Gee, that's all it cost."  I've
had to add, "Yes, but the motorman and conductor worked 12 hour days to earn $2.00
to $2.25 and that that nickel was a very large part of their budget ... that the
working man had to work 45 minutes just to pay the fare to work and back.  And that
if he took his family out in the evening, he had to work a half a day just to pay
the transportation.  And his employer never gave him hospitalization, dental
policies, pharmaceutical plans, eye-glass insurance, paid vacations, or holidays,
and if he died at work the company might have given his widow $10 and then
castigated her for being imprudent in how she spent the money!  In 1902 we had no
entertainment as we know it today ... vaudeville, opera, and concerts were reserved
for the well to do.  The best that a laborer could afford was a picnic in the woods
with his girl friend or wife and family.  Maybe once a year he could afford to see
the circus when it came to town.  The stores offered clothes, candles, yard goods,
newfangled sewing machines, shoes, paper, lead pencils but squandering money on
CDs, video tapes, records, expensive toys  ... heaven forbid, money wasn't intended
for such frivolity.

Now lets move up four decades.  In the late 1930s, an acquaintance of mine in
Lancaster began taking a lot of railfan trips ... especially long ones to Iowa for
a who week to ride the DM&IC, FDDM&S, WCF&N, CRANDIC, and the less well known
Clinton, Davenport and Muscatine.  A year later he took long weekend to go on a
fantrip on the Indiana Railroad.  Jim worked in a local umbrella factory ... made
about $22 a week, which was typical, supported a mother and high school age sister,
and walked 1.5 miles each way every day to work so he could save the car fare for a
vacation trips.  Those vacations consumed an entire month's wages!   Oh, yes, he
and several other Lancastrians availed themselves in 1939 of the See Both Worlds
Fairs tickets that the American railroads offered for $100.  It was good on any
route.   One friend went from Lancaster to Philadelphia, Atlanta, New Orleans, El
Paso, over the SD&AE to San Diego, Los Angeles, San Francisco, Seattle, and home
over the Milwaukee.  Jim used the SP - UP and the Milwaukee along with George
Krambles and Bill Janssen ... they rode the Sacramento Northern all the way to
Chico too..  Oh, yes, they also got the short trip to New York as part of the
deal.   These were major trips.  That train fare was five weeks wages for an
average Joe. Hotel and restaurant bills probably cost more per day than they earned
in a day.   The air fare today can be earned in most people in three to five days!

Fringe benefits, as we know them, evolved apparently after Franklin Delano
Roosevelt signed his signature to the social security legislation.  Ron DeGraw told
me that his father first received any benefits as a P&W motorman after World War
II.  I know my grandfather in Ohio retired in 1955 with only social security and
his savings ... he was a classed as a "cabinet maker" in a chair factory, which
was, at that time, a highly skilled job fixing other's mistakes.

Mr. Holland ... because you are working for Muni and know many operators and
perhaps even retired staff, I would postulate to you that what the museum docents
could use is a factual oral history that shows, for transit operating, skilled and
unskilled shop staff, how working hours, wages, benefits, and life styles changed
over time from 1890 to 2000.  I would hope that you might find this something you
could jump into with both feet.  I can visualize a photo and artifact display (the
latter including soap boxes, pipes, tobacco, theater ticket stubs, uniforms,
motormans' friend,* and so forth) that shows how life styles changed over time.
This has the potential for a traveling museum display and a good book and maybe
even a nice video tape.

We had a display at Arden several years ago that showed the tasks that men do, but
nothing that showed how they lived.  Is this something Jim, that you would like to
try?  Any one else out there?  There really is a need!


(* a motormans' friend was a leather urine pouch that was strapped to one's leg.
It was used by operators whose employers allowed no time for relief. )


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