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Brad DeLong has often criticized the press’s coverage of economics as Dems-say-GOP-says without actually bothering to see which numbers add up. But this fear of math is not limited to economics reporting. In a spot-on post, Gregg Easterbrook takes journalists and politicians alike to task for confusing nominal and real prices of gasoline in their recent claims that we’re suffering from record gasoline prices. Judging from nominal prices, yes, but adjusted for inflation the prices we’re currently paying are historically pretty low. For a comparison, see the chart (from Oregon State) that Easterbrook cites. One can understand how the confusion arises in the general public, who are likely to suffer from the money illusion in most matters (say, confusing a 4 percent raise with a 4 percent raise in real income) and disinclined to compound inflation over the span of years. But there are many who get paid to understand such things and to translate such things for the public, and they should know better. As Easterbrook puts it, “It’s an embarrassment to journalism when big news organizations act as if they don’t know about real-dollar valuation.”

UPDATE: Already today I’ve come across two glaring examples of the above misunderstanding. First, from AP News comes the headline, “U.S. Gas Prices a Penny Short of Record”. They seem to be buying the Energy Dept.’s press release uncritically. Second, I discovered an August press release from Chuck Shumer the “historic highs” of gas prices as reason to attack the Bush Administration’s handling of the U.S.-Saudi relationship. The end of the release is pretty rich:

Schumer noted that gas prices in New York are still below their all-time high when adjusted for inflation, but said that was little comfort for drivers paying 30 or 40 dollars to fill up their tanks. The average price of gasoline in March 1981 of $1.41 a gallon would be $2.87 today.

Below their all-time high? They’re below their all-time average. It’s sad when your own press release contradicts you!