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The Value of a Dollar, 1860–2014

1960–1979: The Vietnam War and the Global Economy

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PRESIDENTS

John F. Kennedy* 1961–1963 Lyndon B. Johnson 1963–1969 Richard M. Nixon † 1969–1974 Gerald R. Ford 1974–1977 Jimmy Carter 1977–1981

† resigned

The 1960s and 1970s were full of hope, revolutionary innovation, and disruptive economic change. The role of government grew and transformed American society. World economics and the Vietnam War altered America’s view of its invincibility; inflation played a critical role in prices, wages, and politics; the cold war ended as the Soviet Union and lesser communist regimes behind the iron curtain collapsed.

From 1960 to 1964 the economy expanded. Gross national product and total federal spending increased by nearly 25 percent. Inflation was held in check. The power of the United States internationally was immense. Congress gave the young president John F. Kennedy the defense and space-related programs he wanted, but few welfare programs. In the years that followed the erection of the Berlin Wall, the Cuban Missile Crisis, and the initial American involvement in the Vietnam War, all of which occurred during the presidency of John F. Kennedy, Americans were forced to think globally—and not always positively. Economic stability during the period was threatened by inflation. From an annual average of less than 2 percent between 1950 and 1965, the inflation rate soared to almost 9.5 percent in the second half of the 1970s. The rate was frighteningly volatile, ranging from 6 percent to almost 14 percent. Banks found it difficult to attract deposits as investors sought better rates of return by shifting their money to other markets. For savings and loan institutions the funds shift was a disaster leading to thousands of closures.

In 1963 a presidential commission on women responded to the complex of issues related to women’s equality. The National Organization for Women and such feminist statements as Betty Friedan’s The Feminine Mystique forced women’s issues, which are grounded in economics, to the forefront of national attention. By 1980 the twocareer family became the norm. Forty-two percent of all American workers were female, and more than half of all married women and 90 percent of female college graduates worked outside the home. Yet, their median wage was 60 percent of that for men.

In 1973 the economic power of foreign oil became alarming. In just two months’ time world oil prices shot up from less than $6 to almost $23 a barrel. Shortfalls and long lines at gas stations resulted. The price at the pump doubled. The second oil shock, in 1978, carried oil prices past $34 a barrel and gas at the pump over $1 a gallon. This situation produced an awareness of U.S. vulnerability and widespread inflation. With roughly 6 percent of the world’s people, the U.S. consumed one-third of world petroleum.

Attempts to control inflation by tightening the money supply through higher interest rates and frozen prices and wages created a combination of rising living costs and recession known as stagflation. In 1979 the consumer price index rose 13.3 percent. The following year interest rates and inflation each hit 18 percent.

The Cold War became hotter during conflicts over Cuba and Berlin in the early 1960s. Fears over the international spread of Communism led to America’s intervention in a foreign conflict that would become a defining event of the decade: Vietnam. Military involvement in this small Asian country grew from advisory status to full-scale war. Vietnam became a national obsession, producing inflation and discontent. In spring 1970 students on 448 college campuses either staged campus strikes or closed down their institutions. The war was the longest in American history; the total cost was $118 billion, 56,000 dead and 300,000 wounded, and the loss of American prestige abroad. The collapse of communism at the end of the 1980s brought an end to the old world order and set the stage for a realignment of power in which America was still regarded as the strongest nation in the world, but the definition of power was expressed increasingly in economic rather than military terms.

The struggle to bring economic equality to blacks during the period produced massive government spending for school integration, especially in the 1960s. By 1963 the peaceful phase of the civil rights movement ended; street violence, assassinations, and bombings marked the period. In 1967, forty-one cities experienced major disturbances, but by 1972 nearly half of Southern black children sat in integrated classrooms, and about a third all of black families had risen economically into the ranks of the middle class.

Year Value in 2012 Dollars 1960 $7.76 1963 $7.50 1965 $7.29 1967 $6.87 1969 $6.26
Year Value in 2012 Dollars 1970 $5.92 1973 $5.17 1975 $4.27 1977 $3.79 1979 $3.16

Use this Currency Conversion chart to calculate what any time in the years listed would cost in 2012 (the most recent year with reliable comparisons). Simply multiply the cost of that item by dollar amount in the chart. For example, if you know that a zigzag sewing machine cost $119.95 in 1965, multiply $119.95 by $7.29 to discover that that same sewing machine would cost $874.43 in 2012.

Citation Types

MLA 9th
"1960–1979: The Vietnam War And The Global Economy." The Value of a Dollar, 1860–2014, edited by Scott Derks, Salem Press, 2016. Salem Online, online.salempress.com/articleDetails.do?articleName=VOD5e_0021.
APA 7th
1960–1979: The Vietnam War and the Global Economy. The Value of a Dollar, 1860–2014, In S. Derks (Ed.), Salem Press, 2016. Salem Online, online.salempress.com/articleDetails.do?articleName=VOD5e_0021.
CMOS 17th
"1960–1979: The Vietnam War And The Global Economy." The Value of a Dollar, 1860–2014, Edited by Scott Derks. Salem Press, 2016. Salem Online, online.salempress.com/articleDetails.do?articleName=VOD5e_0021.