1970s Inflation Is So 50 Years Ago
Too much has changed about economic policymaking to interpret the most recent sustained period of spiraling prices as a cautionary tale for today.
Should everybody worry about these, too?
Photographer: Ernesto S. Ruscio/Getty Images for RFFInflation exceeded 5% a year each year from 1973 to 1982. It hit double digits for three years in a row from 1979 to 1981. The U.S. hasn’t seen such rapid price increases since then. But a recent spike in prices, coupled with large budget deficits and a Federal Reserve aiming for higher inflation, has brought forth worries that the bad old days might be here again.
When the Consumer Price Index came in 4.2% higher in April than it had been the previous year, Republicans declared that President Joe Biden was repeating Jimmy Carter’s record. While market fears of inflation have receded a bit since then, not a day goes by without someone sounding an alarm.