February 25, 1982
Today's report on the latest Consumer Price Index marks another forward step in the struggle against the worst economic disease that America has suffered in recent years.
The decade of the 1970's will long be remembered as a period of rampant inflation -- the worst inflation in our peacetime history. Inflation not only exacted a cruel toll on the incomes of the American people but also was at the heart of much of the stagnation that we experienced.
Since President Reagan came into office and set forward new economic policies, the Nation has made considerable headway against this threat. In January of 1981, the annual year-over-year inflation stood at 11.7 percent. With today's news, we can see that the annual inflation rate has been reduced to 8.4 percent -- a cut of fully one-third.
Moreover, it is worth pointing out that in recent months, some other price indicators have shown that the inflation rate has been running even lower still.
It is anticipated that in coming months, there could be some volatility in these numbers. We should expect to see some months when inflation will be higher than in January. But the important message is that over the long haul, inflation is coming down, and that is very good news, indeed.
For a family of four at the poverty line (on a fixed income of $8,500 during 1981), the drop in the inflation rate during 1981 over 1980 meant a cash savings of some $255. For the average household with an average income (on a fixed income of $24,332 during 1981), the gains in the battle against inflation during 1981 meant an increase in spending power of some $730.
Note: Assistant to the President for Communications, David R. Gergen, read the statement to reporters at his news briefing in the Briefing Room at the White House.