Value of $100 in 1943, adjusted to 1975

What happened to prices between 1943 and 1975

Between 1943 and 1975, the Consumer Price Index went from 17.3 to 53.8. Cumulatively, prices increased 211.0%, which works out to an average of 3.61% per year. Put differently, a dollar in 1943 bought what $0.32 buys in 1975.

Consumer prices rose 6.1% in 1943, a slower pace than 1942’s surge but still well above anything the country had seen before the war. The slowdown owed largely to the “Hold the Line” order, issued that April, which froze most wages, prices, and rents at their current levels after the previous year’s jump showed how far demand had outrun the existing controls. Rationing grew more sophisticated alongside the freeze: starting in February, a points system split scarce goods into red points for meat, butter, and other fats and blue points for canned and processed foods, letting households budget across categories instead of simply going without once a flat quota ran dry. The government also changed how it collected the taxes paying for all of it. The Current Tax Payment Act, signed June 9, required employers to withhold federal income tax directly from paychecks for the first time, smoothing the flow of wartime revenue and creating the pay-as-you-go system still used today. Consumer prices stood 74.7% above their 1913 level and 33.1% above 1933’s Depression-era low. First-class postage held at 3 cents, and the minimum wage stayed at 30 cents an hour.

More about inflation in 1943 →

The destination year: 1975

Consumer prices rose 9.1% in 1975, easing slightly from 1974’s 11.0% but still running far above anything the country had experienced before the decade began. The recession that started in November 1973, the deepest since the Great Depression, bottomed out that March, yet unemployment kept climbing through the year and touched 9%, a combination of high inflation and high joblessness that had no precedent in the postwar data. Vietnam ended that April 30, when North Vietnamese forces captured Saigon and the last Americans were evacuated by helicopter from the U.S. embassy roof. Fiscal strain hit closer to home too: New York City, facing bankruptcy after years of borrowing to paper over budget gaps, asked Washington for help that October. President Ford’s initial refusal produced the Daily News headline “Ford to City: Drop Dead,” though he ultimately signed a federal loan package that December. Amid the gloom, Bill Gates and Paul Allen founded Microsoft that April in Albuquerque, New Mexico, to sell a version of the BASIC programming language for the Altair 8800, one of the first personal computers sold to hobbyists. A median household earned $11,800 in 1975, a new home sold for a median $39,300, and first-class postage held at 10 cents, unchanged since 1974’s increase. Consumer prices stood 443.4% above their 1913 level, with the decade barely past its midpoint.

More about inflation in 1975 →