Assuming the $1.80 price is correct, rising to $35 over 124 years works out to an average inflation rate of 2.4%. That's not too bad, except Levis uses thin denim now and third world labor.
I remember reading a newspaper archive from about 100 years ago and there was a sale on dresses advertised for around $24. Adjusted for inflation clothing seems to have gone down in price over the years largely due to automation in farming, sewing, and shipping from third world countries.
But I am looking at the difference in price between 1888 and 1961, then the difference between `1961 and 2012.
As for the denim, my mom (1970) used to say that Levis used to be made of a much heavier denim. Somewhere along the way they cheapened the product.
I had several pairs made in USA, Mexico, Guatemala, Honduras and Colombia.