A question of value

When The Star News was founded 150 years ago, the cost of a year’s subscription was $1.50.

An observant reader will note that this is less than the current single-issue price of The Star News. The reality of the world is that things cost more than they used to, but how much more is not so easy to pin down.

According to federal reserve inflation calculator, $1.50 in 1875 has the same buying power as $43.32 today. While the Federal Reserve’s calculator is generally a good tool for a broad approach, it has its flaws mainly because it is based on a specific market basket of goods and services and doesn’t deal with innovations of society changes that impact purchasing power. For example, prior to 1886 when modern smelting processes were invited, aluminum was rare and expensive. It was at least as valuable as silver and approaching gold in value.

Now, it is cheap enough that many consider it disposable. There are other things today that have comparatively minimal value in modern society, but which would be a king’s ransom not too long ago. This leads us to look at other potentially more accurate ways to look at changes in value over time.

In 1875 the United States was on the gold standard with the ability of people to directly exchange paper currency for the equal value of gold. At the time, a $1 was the equivalent to about .05 ounces of gold. So a subscription to The Star News was the equivalent of .075 ounces of gold. Based on the current price of gold that is the equivalent of $215.29. Similarly, according to state historical records, the price of “farmland and buildings” per acre in Taylor County in 1890 was $12 per acre. By comparison, farmland valuation tools put the current average value of farmland in Taylor County at $5,894 per acre. This works out to about a 49,016% increase. If the same percentage increase held true between land value and subscription prices, a year’s subscription would be $735.24 per year.

Another way to look at it, and one that I favor is to look at cost in relation to how many minutes, hours, weeks or years I had to work to earn enough to pay for something. I find this is especially useful when I am tempted to impulsively buy something that is potentially frivolous or at least would have little lasting value.

For example, paying the equivalent to about a week’s wages to buy a new washing machine is generally a better, or at least more responsible, long term return on your investment than using a week’s pay to buy 25 cases of Bush Light. Although there are arguments — admittedly not good ones — to be made in defense of buying beer.

Let’s follow this logic and look back at the historical subscription price of The Star News. The average tradesman’s income in the United States in 1875 was about $578 per year. This put a subscription to The Star News at about 0.25% of the person’s yearly income.

Based on this percentage of income, and the current median household income of Medford of about $54,000, the equivalent in today’s dollars would be $135 per year. By comparison, the current in-county subscription rate of $85 per year is only about 0.16% of the median household income of people living in the city of Medford.

Which, when you do the math, doesn’t seem like a lot of money at all to spend on being informed about the people and events in your community every week.

Brian Wilson is News Editor at The Star News. Contact Brian at BrianWilson@centralwinews.com.