Value of $100 in 1924, adjusted to 1954

What happened to prices between 1924 and 1954

Between 1924 and 1954, the Consumer Price Index went from 17.1 to 26.9. Cumulatively, prices increased 57.3%, which works out to an average of 1.52% per year. Put differently, a dollar in 1924 bought what $0.64 buys in 1954.

Consumer prices held flat in 1924, the CPI’s annual average unchanged from 1923 after swinging from a sharp postwar drop to a modest rise the year before. That stability, extending the calm that had settled in after the deflation of 1921 and 1922, became a defining feature of the rest of the decade. Congress tightened immigration policy further with the Immigration Act of 1924, signed May 26, which cut the national-origins quota from 3% of each nationality’s 1910 census population to 2% of its 1890 population, shifting admissions further toward northern and western Europe and effectively excluding most immigration from Asia. Abroad, the U.S.-backed Dawes Plan, adopted that August, reorganized Germany’s war reparations payments and opened the way for American loans into the German economy, helping stabilize European currencies after the hyperinflation that had peaked in 1923. At home, Calvin Coolidge, who had served out the remainder of Warren Harding’s term after his death the previous year, won a full term of his own that November, campaigning on continued prosperity and limited government. First-class postage remained at 2 cents, a price unchanged since mid-1919.

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The destination year: 1954

Consumer prices rose 0.7% in 1954, extending 1953’s 0.8% slowdown even as the economy tipped into recession, an early example of prices continuing to rise through a downturn rather than falling with it. The National Bureau of Economic Research dates that recession from July 1953 to May 1954, as defense spending fell after the Korean War armistice and the tighter monetary policy of the year before worked its way through the economy. The Supreme Court reshaped a different part of American life that spring: its unanimous May 17 ruling in Brown v. Board of Education held that “separate but equal” public schools violated the Constitution, overturning the legal basis for segregated education. Washington also closed the book on a different fight that year. Following the televised Army-McCarthy hearings that spring, the Senate voted 67 to 22 on December 2 to condemn Senator Joseph McCarthy’s conduct, ending his dominance of American politics after four years of anti-communist investigations. Consumer prices finished 1954 171.7% above their 1913 level, essentially flat with 1953 as the mild recession held the cost of living in check. First-class postage held at 3 cents, and the minimum wage stayed at 75 cents an hour.

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