$100 in 1971 is worth $292 in 1988,
because prices increased 192.1% over that period, an average of
6.51% a year.
$100 in 1971 has
the same buying power as
$292
in 1988
Detailed inflation statistics
Cumulative price change
192.1%
Average inflation rate
6.51% per year
Converted amount ($100 base)
$292
Price difference ($100 base)
$192
CPI in 1971
40.5
CPI in 1988
118.3
Inflation in 1971
4.38%
Inflation in 1988
4.14%
$100 in 1971 → 1988
$292
$100 in 1988 → 1971
$34.23
What happened to prices between 1971 and 1988
Between 1971 and 1988, the Consumer Price Index went from 40.5 to 118.3.
Cumulatively, prices increased 192.1%, which works out to an average of
6.51% per year. Put differently, a dollar in 1971 bought what
$0.34 buys in 1988: the 1971 dollar
lost 65.8% of its purchasing power over
these 17 years.
Consumer prices rose 4.4% in 1971, down from 1970’s 5.7% as
the recession that started in December 1969 finally cooled demand. The bigger
economic story came that August 15, when President Nixon closed the “gold
window” that let foreign governments exchange dollars for gold, ending the
Bretton Woods system that had anchored the dollar since World War II. The
same address announced a 90-day freeze on wages and prices, the first
peacetime controls the country had seen, an attempt to break inflationary
expectations without the slower grind of tighter money. The “Nixon Shock,” as
it came to be known, let the dollar float against other currencies for the
first time and set the stage for a wage-and-price-control regime that would
run in various forms into 1973. Politically, the country lowered its voting
age that year: the 26th Amendment, ratified July 1, extended the vote to
18-year-olds, capping a campaign built on the argument that men old enough to
be drafted to Vietnam were old enough to vote for the people who sent them.
The Postal Service, independent since 1970’s reorganization, raised
first-class postage from 6 to 8 cents that May. A median household earned
$9,028 in 1971, up from $8,734 the year before, while gas held near 36 cents
a gallon and a new home sold for a median $25,200. Consumer prices stood
309.1% above their 1913 level by year’s end, still years away
from the double-digit inflation the controls were meant to prevent.
Every 1971 amount converts to 1988 at the same ratio, 2.92: $1,000 becomes
$2,921, and $10,000 becomes $29,210.
Amount in 1971
Value in 1988
$1.00
$2.92
$5.00
$14.60
$10.00
$29.21
$20.00
$58.42
$50.00
$146
$100
$292
$500
$1,460
$1,000
$2,921
$5,000
$14,605
$10,000
$29,210
$100,000
$292,099
$1,000,000
$2,920,988
Inflation by spending category, 1971–1988
Between 1971 and 1988, medical care rose the most, up 283.9%, while apparel rose the least, up 88.9%, against 192.1% for all items. The headline number is an average; here is what $100 of 1971
spending costs in 1988, by category:
Category
Avg. yearly inflation
$100 in 1971 →
All items (CPI-U)
6.51%
$292
Medical care
8.24%
$384
Energy
7.41%
$337
Housing
6.92%
$312
Food
6.52%
$293
Core (all items less food & energy)
6.44%
$289
Transportation
6.14%
$275
Apparel
3.81%
$189
Not shown because the BLS began these indexes after 1971: recreation (1993–), education & communication (1993–).
Decade by decade: 1971 to 1988
Prices climbed fastest in the 1970s, averaging 8.21% a year, and slowest in the 1980s (4.62% a year). Each step below chains into the full 1971–1988 change:
Years
Avg. yearly inflation
Price change
$100 from 1971, at end
1971–1980
8.21%
103.5%
$203
1980–1988
4.62%
43.6%
$292
Year by year: CPI and the value of $100 from 1971
$100 from 1971 had already become $179 by
1979, on its way to $292 in 1988; each row shows the CPI, that
year's inflation rate, and the running value.
Within the span, inflation peaked at 13.5% in 1980, and the smallest rise was 1.9% in 1986.
In 1988, prices rose 4.1% and $100 from 1971 had the buying
power of $292; the year's average CPI of 118.3 is the level
behind every 1988 figure on this page.
By 1988, the economic expansion that began in the ashes of the 1981-82
recession was in its sixth year, and the Federal Reserve was watching for
signs it had run too long. Inflation rose to 4.1%, up from 3.6% the year
before, while unemployment fell to its lowest level since 1974. Alan
Greenspan’s Fed responded by raising the federal funds rate through the
year, from about 6.5% to 8.5%, trying to cool demand before prices
accelerated the way they had in the 1970s. Households still felt the
difference between this expansion and the last one: gas held near 90 cents
a gallon, almost exactly its 1987 price, and median household income rose
to roughly $27,200. The one price that moved was postage, which rose from
22 to 25 cents in April, the fourth increase of the decade but a far
gentler pace than the string of increases in the late 1970s and early
1980s. In November, Vice President George H.W. Bush won the presidency on
the strength of the expansion, promising in his nomination speech to hold
the line on taxes. Both the boom and that pledge would run into trouble
within two years, as the Fed’s rate increases helped tip the economy toward
the 1990-91 recession.
MLA: “Inflation from 1971 to 1988: $100 is worth $292 today.” InflationCalculator.com, U.S. Bureau of Labor Statistics CPI-U data, https://inflationcalculator.com/inflation/1971-to-1988/
APA: InflationCalculator.com. Inflation from 1971 to 1988. Based on U.S. Bureau of Labor Statistics CPI-U data. Retrieved from https://inflationcalculator.com/inflation/1971-to-1988/