About.com economics guru (and fully signed-in Curious Capitalist commenter) Mike Moffatt looks at today’s CPI data (4.1% annual inflation in 2007!) and muses:
The more I look at oil prices, gold prices, inflation and the economy, the more I believe we are starting to re-live the early 1970s. I just hope the fashions don’t come back as well.
I’m pretty sure Mike wasn’t even alive yet in the early 1970s. What the heck would he know about that? I was there, and the experience has inspired me to embrace for the very first time that surefire ticket to blogging fame and fortune that is the list:
Ten Reasons Why 2008 is Different From 1971
1. In 1971, inflation at levels close to today’s 4.1% was enough to prompt President Richard Nixon to impose wage and price controls. (Hat tip to Steve Cecchetti, who was channeling Jim Grant.) Since then, though, “core inflation” has been invented–and it’s much lower than 4.1%, so everything is fine.
2. In 1971, labor unions were still a major economic force, and helped ensure that worker pay kept up with inflation, which contributed to a wage-price spiral. Now most American workers are downtrodden wage slaves who’ll take whatever they can get. Heartening, no?
3. In the 1970s, Detroit produced big, gas-guzzling vehicles and struggled to adjust in an era of high fuel prices as smaller Japanese imports began to make market share inroads. Now, Detroit produces big, gas-guzzling vehicles and struggles to adjust in an era of high fuel prices as cars from Japanese makers–many of them manufactured in the U.S.–solidify their market-leading positions. See, that’s different!
4. In the early 1970s, the Federal Reserve chairman was a former Columbia University professor of great repute who faced intense pressure from the White House to keep interest rates low even as inflation rose. Now the Federal Reserve Chairman is a former Princeton University professor of great repute who faces intense pressure from Wall Street to keep interest rates low even as inflation rises. Again, totally different.
5. In 1971 gold cost $40 an ounce. Now it costs $887. Where’s the parallel there? Oh, and if you divide $887 by $40 you get $22.17, which amazingly enough is exactly what it will cost you to buy a bundle of Hog Casings for Small Brats, Italian Sausage at http://www.butcher-packer.com.
6. There was no such thing as http://www.butcher-packer.com in 1971.
7. In 1972 (which isn’t exactly 1971 but close enough), crying on TV lost you the New Hampshire primary. This year it’s a winner. (I know, that one’s not very original. But it seemed too obvious not to mention.)
8. Since fashion is such a big deal to Mike: In the 1970s, according to Answers.com, Betsey Johnson “designed slip dresses, drop-waist ballerina dresses, double knit A-line minis, and ‘nutsy artsy’ embroidered sweaters.” Now she designs friggin’ prom dresses. She does, however, continue to have funny hair.
9. Lead singer Chuck Negron is no longer with Three Dog Night.
10. Unlike in 1971, the Oakland A’s are decidedly not on the cusp of winning three World Series in a row. Seriously, I love my A’s and I love Billy Beane. But the team of minor leaguers they’re fielding this year is gonna lose at least 90 games.
Update: Mike Moffatt suggests a new No. 10 that almost brings a tear to my eye (which should help me in my quest to become New Hampshire’s favorite MSM econobusiness blogger):
10. Unlike in 1971, the Montreal Expos are decidedly not going to lose 90 games. In fact, they won’t lose any!