Cost Of Living: The Steepest Climb

It is practically an article of faith that political platforms have major planks dealing with the U.S. economy. Yet in 1968 both the Republicans and Democrats—bothered by what seem to be more pressing problems, such as the Viet Nam war, law and order, and civil rights—paid only token attention to the economy. By so doing, they ruled out as a major political issue what has certainly become a matter for concern in almost every U.S. home: the rising cost of living.

In June and July, the cost of living made its steepest two-month climb in eleven years. Going up by one-half of 1% each month, the consumer price index reached 121.5 (using the figure of 100 for the base period 1957-59). On that scale, the average family now pays $12.15 for the same items that cost $10 in 1957-59.

Interest rates on home mortgages led the way up, rising 4.5% to 7% in July, a level more than 13% above that of July 1967. Despite such fixed-cost programs as Medicare, medical expenses were up 9% over July 1967, for the simple reason that doctors, dentists and hospitals are all charging more. Even though overall retail food prices rose only a smidgen, grocery-store prices were up a full 3% over the same month last year. Finally, July’s traditional clothing sales brought prices down less than usual. The U.S. family budget this summer was obviously undergoing strains.