what happened in 1971

[johnsmith]

wtfhappenedin1971.com/

interesting stuff; food for thought.

[marpro]

Feb 22, 2023 0:26:33 GMT johnsmith said:

wtfhappenedin1971.com/

interesting stuff; food for thought.

It is not 1971. It started earlier after NASA's moon landing program started. The by products of the several technologies, such as integrated circuits, computers, etc. I grew up with them. The technology made the growth faster.

[bruno]

and i graduated in 1971 making $600 a month at a gas station.

[gman57]

I graduated....you're welcome    It was also about the middle of the baby boom generation starting out, making money and spending.

[retiredat48]

johnsmith ,...nice set of charts.

There was an old management mantra (saying) within GE management where I worked from 1970 on. It was: "The hell with the statistics, give me the facts." It meant that one can be easily fooled by the statistics. One needs to understand the underlying facts to assess things. Some examples follow:

First, the key events of 1970 were done early by President Nixon:

--Going off the gold standard.

and

--Opening up CHINA for trade...almost widespread trade, even if slow at first.

The gold standard kept prices in check, for one could take their silver certificates and exchange them for real silver coins...until 1970.

China (after the cold war) meant a huge reduction in cost for goods with such cheap labor, and a benefit to almost all Americans with the low product costs. Whereas USA made 100% of early TV sets, it went to zero percent within a decade. But GDP grew greatly due having all these cheap products. However,  we lost the higher paying jobs, such as manufacturing.

Some comments on the stats:

--median house prices ( and other stats) shows the move to two workers per family late 1970's. Workers knew costs of homes and mortgages would go up to reflect two-earner families. They did.

--stock market up strongly since 1970. Inflation also way up. About 40% of stock rise is simply due to inflation and loss of purchasing power.

--PE ratios...yes, a flaw in them is if earnings go to zero (think Covid) the PE ratio goes to infinity.

--1970's oil begins zooming upward. Yes, a USA educated Saudi named Sheik Yamani convinces his dad to not sell Saudi oil so cheaply...like 10 cents a barrel. That Saudi people need the income badly. They formed OPEC and Saudi people got on board with some wealth sharing. Oil price rises mostly a transfer of wealth to OPEC.

Bottom line: The USA created the middle class after WW2. It held while we dominated the (destroyed) world...to 1970's. The USA is now in the process of taking the middle class away...about 1% fewer each year.

And when my State, FLorida, let the people vote on a wage increase, the constitution changed from a minimum wage of about $8 and hour, to $15/hour by 2025 by vote, you can bet big mac hamburgers will go up similarly in price!! They already are.

R48

[Chahta]

I was a freshman in college.

[Broozer]

I was in the 3rd year of my toolmaker apprenticeship at Bausch & Lomb, and I got engaged to my first wife in June of that year.

[richardsok]

Feb 22, 2023 1:30:03 GMT bruno said:

and i graduated in 1971 making $600 a month at a gas station.

You were well paid at your gas station.   In 1971 I had just graduated and worked as a inner city high school teacher.  I took home (after everything) $440 per month.  

[Broozer]

Feb 22, 2023 5:07:23 GMT richardsok said:

Feb 22, 2023 1:30:03 GMT bruno said:

and i graduated in 1971 making $600 a month at a gas station.

You were well paid at your gas station.   In 1971 I had just graduated and worked as an inner city high school teacher.  I took home (after everything) $440 per month.  

As a 3rd year apprentice (as I recall) I was probably making about $4 per hour. At a 40 hour work week, that would be a gross $640 per month.

[Mustang]

1971? I had an all expense paid trip to Southeast Asia courtesy of Uncle Sam.

Many of the charts show the cumulative effect of inflation. The 70s were the main stagflation years of a stagnant economy and high to double digit inflation. 1971 was when the rest of the world started catching up with the US, recovering from the devastation of WWII. In the 1950s and early 1960s, Japanese products were considered cheap junk. By the mid to late 70s the Japanese were starting to produce high quality products, including cars.  In 1971 I bought one of the best stereo systems made - made in Japan.

Inflation led to high costs. Cost controls caused American cars to pretty much be junk. New cars were leaking oil on showroom floor. Japanese cars were also more fuel efficient than American cars. That was particularly important during the oil embargo. 1971 was the year the Ford Pinto came out. What a disaster. In 1973 (the year of the embargo) the grossly under powered Mustang II came out. The 60s muscle car era had pretty much ended.

In high school I made $.75 per hour pumping gas. Working full time that would have been around $120 per month. After graduating I made $2.12 per hour ($339 per month) working in a factory. An inflation calculator says that is equivalent to $18.23 per hour today. Wages spiked up but the gain was all taken away by inflation. So any chart showing real wages or purchasing power would pretty much show a flat line over the last 50 years. The working class isn't any better off.  They just have more, less valuable dollars in their pocket.

Where did stagflation come from? Government deficit spending. Johnson's spending on the Vietnam war while also spending for his Great Society. It wasn't until the 1980s that inflation finally came under control.  Lately massive deficit spending has let the monster back out of the bag.

People complain about going off the gold standard but as imports flooded the market other countries were flush with dollars and they used those dollars to buy gold. The US was sending its gold reserves overseas at an alarming rate. Our economy is so large today there isn't enough gold in the entire world to go back on the gold standard of $35 per ounce. In 1971 we went off the gold standard and  the dollar was devalued to $38 per ounce.  In 1973 it was devalued to $42 per ounce. By 1976 the price of gold was determined by the market.

Two working families were primarily a result of two things: WWII's Rosie the Riveter and later birth control. The first made it acceptable for women to work in the factories. The second freed them from the burden of multiple children. My great-grandmother (born in 1890) had 8 kids. That was not unusual. It was typical for women to have 7-8 kids. Raising them without the advantages of technology was a full time job. My mother had four kids and worked in a factory. My wife two and taught college.

Technology changed the way America worked. The Apple II personal computer came out in the late 70s. I bought an Apple IIe in the early 80s. More and more jobs were in the office instead of the factory floor.  Along with that more people needed college degrees.  Technology has advanced even further allowing people to work from home instead of going to the office.  With the worst of COVID gone they are resisting going back to the office.

One chart shows the changes of elected officials between the two political parties. In the 60s and 70s there were a huge number of conservative Democrats mostly from the South. The Southern states were not about to join the party of Lincoln. In the early 80s Ronald Reagan led a collation of Republican and conservative Democrats. But after that the parties changed and conservatives started leaving the Democratic party. The saying at the time was "I didn't leave the Democratic Party, it left me."  The Southern states movement from Democrat to Republican is the primary reason for the changing line on the chart.  Alignment with the political parties changed as well.  It is no longer North and South.  Cities became Democrat.  Rural areas became Republican. 

There were a tremendous number of changes over the last 50 years but that could also be said of the period 1921 to 1971 and it will also be said of the period 2021 to 2071. I wonder how much the US will change with the continued use of the internet cloud and the development of artificial intelligence. 

[steelpony10]

   johnsmith ,

          Women’s lib flooded the workforce. More workers equals less you have to pay. The rest is mechanization which replaced some jobs and/or work became more efficient.

           Stagflation began about then and with massive layoffs people were happy to have a job at any wage.

           Computerization and jobs shipped out of the country kept wages lower still. The rich got richer and the poor got poorer destroying the middle class. Maybe a worldwide aging population and declining workforce pool with reverse that trend.

            I wasn’t in the states much then. I have no recollection of income at all other then I had enough to get by and wasn’t married yet. 

           

[steadyeddy]

johnsmith, nice charts. But to be honest I couldn't quite relate THEN to NOW.

I was in high school then.

[racqueteer]

Feb 22, 2023 5:07:23 GMT richardsok said:

Feb 22, 2023 1:30:03 GMT bruno said:

and i graduated in 1971 making $600 a month at a gas station.

You were well paid at your gas station.   In 1971 I had just graduated and worked as a inner city high school teacher.  I took home (after everything) $440 per month.  

Sounds about right...  I had just left teaching school at about $567 a month gross, to become a tennis teaching pro for about double that - WITH housing!  I suspect the decade of the '70s saw most potential teachers go into other fields of endeavor.  Few jobs, low pay. 

One advantage: Witnessed the growth of computers for the masses from punch cards on mainframes.  A 'personal computer' filled a small room of the VERY few people having one!  I credit that growth period with my son's future success in computing.

I guess watching every Super Bowl should also count for something...

[johntaylor]

At LZ Tombstone in Vietnam

[richardsok]

This conversation takes me back -- I do remember a period of shock/disappointment/shame around age 22-25 when I had just graduated from a good college, was working on my masters, and found a lot of blue collar guys my age were making significantly more than I was.
I also sensed I was becoming a less desirable "catch" in the dating pool than I had been in college.

[Chahta]

Feb 22, 2023 14:28:30 GMT richardsok said:

This conversation takes me back -- I do remember a period of shock/disappointment/shame around age 22-25 when I had just graduated from a good college, was working on my masters, and found a lot of blue collar guys my age were making significantly more than I was.
I also sensed I was becoming a less desirable "catch" in the dating pool than I had been in college.

In my/our day high school was about "college prep". That was the goal of education. Very little to none was said about the trades. I knew sheet metal workers that retired at 55 with a nice size union pension during my carreer. No one ever taught us about that. Years later, like the last 10 years or so, education for the trades at high school and community college is a big thing.

[racqueteer]

Feb 22, 2023 14:28:30 GMT richardsok said:

I also sensed I was becoming a less desirable "catch" in the dating pool than I had been in college.

In retrospect, it was probably a good thing to have married BEFORE I had a chance to lose my hair! 

[habsui]

In 1971, I fell of my bike and scraped my knee.

As there was no social media then, I have to report this important fact now..

[Deleted]

I was 11 and got my first job. Convinced the manager of the local Radio Shack to let me clean the store and cover the register on his lunch/dinner breaks for .50/hr. Apparently, he figured that since I was already hanging out there anyhow, why not?

[marpro]

A 1971-murder solved after 50 years now using a cigarette butt. That is due to the power of new technology using the DNA.

Murder of Vermont woman solved after more than 50 years using DNA found on a cigarette and the victim’s clothing.

[bruno]

Feb 22, 2023 12:52:16 GMT racqueteer said:

Feb 22, 2023 5:07:23 GMT richardsok said:

You were well paid at your gas station.   In 1971 I had just graduated and worked as a inner city high school teacher.  I took home (after everything) $440 per month.  

Sounds about right...  I had just left teaching school at about $567 a month gross, to become a tennis teaching pro for about double that - WITH housing!  I suspect the decade of the '70s saw most potential teachers go into other fields of endeavor.  Few jobs, low pay. 

I guess watching every Super Bowl should also count for something...

I loved my job but gas company boss came by and offered me job at $590 a month that i took. When i told my boss I was quitting and was getting $590 a month he said " I am paying you more" I said Woody you are correct but its only 40 hr a week job this gas station was 66 hr. a week. He then asked me if I could still work weekends for him and i agreed. 

[Capital]

Feb 22, 2023 19:30:26 GMT habsui said:

In 1971, I fell of my bike and scraped my knee.

As there was no social media then, I have to report this important fact now..

So that's what it was. I was 14 then and felt a distinct disturbance in the force. Now 52 years later I can live in the peace that knowing this has given me. 

[marpro]

Feb 22, 2023 23:24:50 GMT Capital said:

Feb 22, 2023 19:30:26 GMT habsui said:

So that's what it was. I was 14 then and felt a distinct disturbance in the force. Now, 52 years later, I can live in the peace that knowing this has given me. 

Enjoying the warm weather down there? It is cold rain, sleet, and snow up north here. We want to get out of here, but can't.

[Deleted]

Feb 22, 2023 22:22:04 GMT bruno said:

I loved my job but gas company boss came by and offered me job at $590 a month that i took. When i told my boss I was quitting and was getting $590 a month he said " I am paying you more" I said Woody you are correct but its only 40 hr a week job this gas station was 66 hr. a week. He then asked me if I could still work weekends for him and i agreed. 

From age 15 to 18, I was Asst. Mgr. at a carwash/service center/gas station. Possibly the best 3 years of my working career. Not the best paid, of course. We were all friends and partied like it was 1999, 24 years in advance. 

On rainy Sundays, we had to use shovels and wheelbarrows and a crusty old pump to remove the sludge from the wash pit trench. I recall those days quite fondly. My best friend, to this day, was the Chief Mechanic at age 18. One day at lunchtime, on a whim, he loaded up his tools into a 1974 El Camino and lit out for California. I think he was 20 or 21 at that time. 

[nobhead]

I finished my 4 year enlistment in the Air Force by turning down a $10,000 reenlistment bonus for 4 more years. Went back to my old job managing the men's department at a department store. Salary was $125 per week for minimum of 60 hours per week. Married with 2 kids at the time.

[Broozer]

Winding the clock back to 1967, I worked part time during the summer for a farmer for 75 cents per hour. I usually got around $16-18 per week. I was 17 and still living at home.

I had a ‘61 Corvair, my first girlfriend, and gas was about 25 cents per gallon. We’d usually go to the drive-in, hang around, go here go there, and I’d still have a few bucks left when payday came. I give my very frugal (long dead) parents the credit for my discipline with money. It has served me well.

[catdog]

I was a 16 year old junior in high school.  Got a job in a diner doing dishes for $1.25 an hour. Worked that spring and summer about 28-30 hours a week and then all through my senior year.  I was a little shy and the waitresses were all pretty, but a few years older than me.  Always had money in my pocket as a senior, but not much time to spend it.

[archer]

Starting in 72 I worked as a hod carrier in the summers during high school. The pay was $2.75/hr. I also had a small lawn care business mowing lawns for the small industrial business in my area. I billed those by the job, and that averaged a gross of about $35/hr, for about 10 hrs a week. Unfortunately my tractor kept needing repairs, which ate up a lot of that, as well as depreciation. I didn't really know at the time about these expenses because my Dad was paying them so I would stay motivated to work. After a couple years he broke the news to me figuring it was time for me to take more responsibility. It still warms my heart to think of the managers of those businesses and my dad for wanting to encourage a kids work ethic.

[steadyeddy]

Feb 24, 2023 22:38:48 GMT archer said:

Starting in 72 I worked as a hod carrier in the summers during high school. The pay was $2.75/hr. I also had a small lawn care business mowing lawns for the small industrial business in my area. I billed those by the job, and that averaged a gross of about $35/hr, for about 10 hrs a week. Unfortunately my tractor kept needing repairs, which ate up a lot of that, as well as depreciation. I didn't really know at the time about these expenses because my Dad was paying them so I would stay motivated to work. After a couple years he broke the news to me figuring it was time for me to take more responsibility. It still warms my heart to think of the managers of those businesses and my dad for wanting to encourage a kids work ethic.

"Work Ethic"... probably the most important phrase that we all need to teach generations down. If people have that, everything else will take care of itself. Thanks archer for bringing that up!