WTFrick 1971: THE Smoking Gun Year that the plug got pulled on Peak America + The Dream

The Great Inflation

LINK

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In 1964, inflation measured a little more than 1 percent per year. It had been in this vicinity over the preceding six years. Inflation began ratcheting upward in the mid-1960s and reached more than 14 percent in 1980. It eventually declined to average only 3.5 percent in the latter half of the 1980s.

While economists debate the relative importance of the factors that motivated and perpetuated inflation for more than a decade, there is little debate about its source. The origins of the Great Inflation were policies that allowed for an excessive growth in the supply of money—Federal Reserve policies.

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War on Drugs
1964 Civil Rights
Open border
Cheaper foreign labor.

We destroyed the American Dream by Government and Fed policy.

1965 Immigration & Nationality Act.

/thread

Lotta stuff happened in 1971... The Social Change and "consciousness" also began infesting the culture during 1971. This heralded the beginning of Social Engineering.

TV's 'The Rural Purge' and End of Idealism & Innocence:

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The basis for the new hit documentary 1971: The Year That Music Changed Everything, now streaming on Apple TV+.

A rollicking look at 1971, rock’s golden year, the year that saw the release of the indelible recordings of Led Zeppelin, David Bowie, the Who, Rod Stewart, Carole King, the Rolling Stones, and others and produced more classics than any other year in rock history

The Sixties ended a year late. On New Year’s Eve 1970 Paul McCartney instructed his lawyers to issue the writ at the High Court in London that effectively ended the Beatles. You might say this was the last day of the pop era.

1971 started the following day and with it the rock era. The new releases of that hectic year—Don McLean’s “American Pie,” Sly Stone’s “Family Affair,” Marvin Gaye’s “What’s Going On,” Joni Mitchell’s “Blue,” Led Zeppelin’s “Stairway to Heaven,” the Who’s “Baba O’Riley,” and many others—are the standards of today.

David Hepworth was twenty-one in 1971, and has been writing and broadcasting about music ever since. In this entertaining and provocative book, he argues that 1971 saw an unrepeatable surge of musical creativity, technological innovation, naked ambition and outrageous good fortune that combined to produce music that still crackles with relevance today. There’s a story behind every note of that music. From the electric blue fur coat David Bowie wore when he first arrived in America in February to Bianca’s neckline when she married Mick Jagger in Saint-Tropez in May, from the death of Jim Morrison in Paris in July to the reemergence of Bob Dylan at Madison Square Garden in August, from the soft launch of Carole King’s Tapestry in California in February to the sensational arrival of Led Zeppelin’s “Stairway To Heaven” in London in November, Hepworth’s forensic sweep takes in all the people, places and events that helped make 1971 rock’s unrepeatable year.

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Were all these rampant changes just in one year (1971) a coincidence? Or...planned "Reset" of sorts?

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is that about when we went off the gold standard??

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Bingo

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War on Drugs
1964 Civil Rights
Open border
Cheaper foreign labor.

We destroyed the American Dream by Government and Fed policy.

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All that you mention is definitely true...

They contributed to sabotaging the America by and for common sense and actual national interest.

That said -- the metrics and graph provide THE smoking gun that AS OF 1971 (and still on the Gold Standard), America was cruisin'.

IF Nixon and PTB hadn't pulled the plug on the Gold Standard, you have to wonder how long America would have been Peaking.

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I think is missed is that the situation before 1971 was an unrealistic one. Between 1945 and the 1970s we were harvesting the fruit of being the lone functioning economy on the winning side of WW2. That idea situation was not going to continue.

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Good point.

While most of the world had been struggling since 1967, the US was indeed the beneficiary of reaping the harvest of wealth (maybe un-earned?)

Austrians pointed this out years ago. As a matter of fact, Irwin Schiff, gave congressional testimony to stop Nixon from doing this to no avail.

It's the reason why our trade deficits remain horrendous

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As tough as the 70s and 80s were, it seems like was more fulfilling and less stressful.

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In aces.

The "Hope" and "Contentment" and "un-Stress" quotient (as you note) was extremely high -- even if someone were struggling. The vibe seemed totally optimistic no matter what.

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Liberator

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Thanks for bringing all of that here. Great topic.

Here are some points:
- it appears every time there's a crash of some sort, wealth inequality increases. There was a crash around 1907 that led to us getting the Fed in 1913. Great Depression. Hard times with the oil crisis and so forth, and you see an inflection beginning around 1980. Then 2008. Crash and crisis lead to more inequality.
- Wealth inequality should be there to some degree, as that is part of the natural way the markets work. Easy to make money if you have money.
-This inequality was suppressed by the government in WWII with things like wage controls and such, so it was artificially low at that time. However, it stayed low and I don't know why that's the case. Interesting that it took some disruptions for it to re-emerge.
- The rich are always in a place to benefit from crisis. You need food and don't have enough money. They have the money to buy food, and your car, and your house. Assets. Appreciation, etc etc etc. During the Keystone saga, Obama pulled that decision up to his level and sat on that decision for years so that his buddy, Warren Buffet could purchase BNSF and haul oil. Buffet made billions. The crisis was induced by Obama and the federal government interfering in the pipeline and then Obama gave a sweet deal to his buddy and just like that, Buffet got richer while those pipeline workers and local economies suffered.
- One of the things this tells me is that we must decrease regulation. The rich are not only best equipped to deal with crisis, they are best equipped to deal with regulation and this destroys competition. If we had more competition, things would compress. We desperately need a competitor to Amazon for instance.
- We also must elect better people that don't work with Big Money to take advantage of a crisis or fabricate a crisis which always leads to the 1% getting richer and the rest suffering.
- Something a lot of the crashes have in common is the intervention by government or, conversely, the failure by government to do the things it was set up to do, like the failure of the Fed during the Great Depression. Sometimes you have to wonder how much of that is intentional.