Value of $100 in 1927, adjusted to 1952

What happened to prices between 1927 and 1952

Between 1927 and 1952, the Consumer Price Index went from 17.4 to 26.5. Cumulatively, prices increased 52.3%, which works out to an average of 1.70% per year. Put differently, a dollar in 1927 bought what $0.66 buys in 1952.

Consumer prices fell 1.7% in 1927, a mild retreat after three years of gradual increases and part of a shallow up-and-down pattern that ran through the second half of the decade. Aviation delivered the year’s signature moment: Charles Lindbergh departed Roosevelt Field, New York, on May 20 and landed at Le Bourget Field outside Paris roughly 33.5 hours later, the first person to fly the Atlantic solo and nonstop. Detroit closed a chapter of its own that May, when Ford halted the Model T’s production line after nearly 19 years and more than 15 million cars sold, idling tens of thousands of workers while its factories retooled for the Model A. The Federal Reserve, meeting with European central bankers that summer, cut its discount rate to ease pressure on currencies still recovering from the war, a move later cited by economists including Milton Friedman and Anna Schwartz as fuel for the stock market speculation that built through the following two years. First-class postage held at 2 cents.

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The destination year: 1952

Consumer prices rose 1.9% in 1952, down sharply from 1951’s 7.9% as the price and wage controls imposed the year before held the cost of living in check even with the Korean War still underway. Labor strife tested those controls that spring: to head off a strike that could have disrupted war production, President Truman ordered the government to seize the steel industry that April, over the objections of steel companies fighting the price the Office of Price Stabilization had set for their product. The Supreme Court ruled the seizure unconstitutional in Youngstown Sheet & Tube Co. v. Sawyer that June, a landmark limit on presidential power, and steelworkers then struck for 53 days before a settlement. Politics delivered the year’s biggest change that November: Dwight Eisenhower defeated Adlai Stevenson, promising to “go to Korea” to end the war and returning Republicans to the White House for the first time since 1933. The Cold War’s technological edge sharpened that same month, when the United States tested the first hydrogen bomb at Enewetak Atoll on November 1, a device hundreds of times more powerful than the atomic bombs used against Japan in 1945. Consumer prices finished 1952 167.7% above their 1913 level. First-class postage held at 3 cents, and the minimum wage stayed at 75 cents an hour.

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