Value of $100 in 1950, adjusted to 1969

What happened to prices between 1950 and 1969

Between 1950 and 1969, the Consumer Price Index went from 24.1 to 36.7. Cumulatively, prices increased 52.3%, which works out to an average of 2.24% per year. Put differently, a dollar in 1950 bought what $0.66 buys in 1969.

Consumer prices rose 1.3% in 1950, up from 1949’s 1.2% decline, a mild gain that hid a sharp turn partway through the year. The cost of living had been roughly flat through the spring, then jumped after North Korea invaded South Korea on June 25, setting off a wave of hoarding and defense buying reminiscent of World War II shortages. The United States entered the war within days under a United Nations mandate; American and South Korean forces were pushed back to the Pusan Perimeter that summer before a landing at Inchon that September reversed the front, and China’s entry into the war that November turned it into a longer stalemate. Congress moved to put the economy on a war footing that September, passing the Defense Production Act, which gave the president authority to direct industrial output toward the military and, if prices kept climbing, to impose formal wage and price controls. Domestic policy also expanded that year: the Social Security Amendments of 1950, signed August 28, raised benefits across the board and extended coverage to roughly 10 million more workers, the program’s first major expansion since it began in 1935. Consumer prices finished 1950 143.4% above their 1913 level, matching 1948’s postwar high after 1949’s brief decline. First-class postage held at 3 cents, and the minimum wage stood at 75 cents an hour after January’s increase.

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The destination year: 1969

Consumer prices rose 5.5% in 1969, up from 1968’s 4.2% and the fastest pace since the Korean War era, as years of Vietnam War spending, a labor market with unemployment under 4%, and expansionary fiscal policy finally showed up fully in prices. Richard Nixon was inaugurated that January 20, pledging to curb rising prices without wage and price controls, a position he would reverse within two years. The decade’s most triumphant moment came that July 20, when Neil Armstrong and Buzz Aldrin walked on the Moon while Michael Collins orbited above, fulfilling the goal Kennedy had set in 1961 of landing a man on the lunar surface before the decade’s end. Culture and protest both reached new extremes that year: an estimated 400,000 people gathered on a dairy farm in Bethel, New York, for the Woodstock music festival that August, and a police raid on the Stonewall Inn in New York’s Greenwich Village that June touched off days of resistance now credited with launching the modern gay rights movement. Consumer prices finished the decade 270.7% above their 1913 level, up 24.0% from where they stood in 1960. The 1960s had opened with inflation near 1% a year and closed with prices rising faster than at any point since Korea, setting up the Great Inflation that would define the 1970s. First-class postage held at 6 cents, and the minimum wage stayed at $1.60 an hour.

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