Value of $100 in 1947, adjusted to 1976

What happened to prices between 1947 and 1976

Between 1947 and 1976, the Consumer Price Index went from 22.3 to 56.9. Cumulatively, prices increased 155.2%, which works out to an average of 3.28% per year. Put differently, a dollar in 1947 bought what $0.39 buys in 1976.

Consumer prices rose 14.4% in 1947, up from 1946’s 8.3% and the fastest annual increase since 1920, as the last of the wartime price controls disappeared and a year of strikes, wage catch-up, and lingering shortages hit consumers all at once. Congress answered the previous year’s strike wave that June, overriding President Truman’s veto to pass the Taft-Hartley Act, which banned secondary boycotts and the closed shop and let states adopt “right-to-work” laws curbing union power. American attention was also turning outward. In a June 5 speech at Harvard, Secretary of State George Marshall outlined a U.S.-funded plan to rebuild Western Europe’s economies, an effort that would become known as the Marshall Plan once Congress funded it the following year. The government reorganized itself for the confrontation with the Soviet Union that plan was partly designed to prevent: the National Security Act, signed July 26, created the Department of Defense, the Air Force as a separate service, the Central Intelligence Agency, and the National Security Council. Consumer prices stood 125.3% above their 1913 level and 30.4% above 1929’s pre-Depression peak, up from just 1.2% above it four years earlier. First-class postage held at 3 cents, and the minimum wage stayed at 40 cents an hour.

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The destination year: 1976

Consumer prices rose 5.8% in 1976, the calmest pace since 1972, as the economy pulled out of the 1973-75 recession and price growth settled to roughly half its 1974 peak. The recovery gave Americans room to celebrate: tall ships filled New York Harbor and fireworks lit cities nationwide on July 4 for the country’s bicentennial, a rare moment of shared celebration after Vietnam and Watergate. Politically, Jimmy Carter, a former Georgia governor running as a Washington outsider, defeated incumbent Gerald Ford that November, campaigning on restoring trust in government and bringing down inflation and unemployment together. In a California garage, Steve Jobs, Steve Wozniak, and Ronald Wayne founded Apple Computer that April to sell the Apple I, a bare circuit board aimed at electronics hobbyists, a business that looked far from consequential at the time. First-class postage, which had risen to 13 cents that past December 31, held there through the year, the longest stretch without a rate change since the Postal Service’s creation. A median household earned $12,686 in 1976, a new home sold for a median $44,200, and gas averaged 59 cents a gallon. Consumer prices stood 474.7% above their 1913 level, a calm interlude before inflation turned back up.

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