Movements·volcker_disinflation_1979_1982

Volcker disinflation

USA·1979 – 1982·Fed under Paul Volcker; bipartisan tolerance under Carter / Reagan

Leaders: Paul Volcker (Fed Chair) · Jimmy Carter (appointed him) · Ronald Reagan (backed him through recession)

Doctrine — stated goals and content

Break 1970s stagflation inflation expectations via aggressive monetary tightening. Fed funds rate spiked to ~20% in 1981; two back-to-back recessions (1980, 1981-82) with unemployment peaking ~10.8%. Demonstrated that central bank independence + willingness to accept short-term pain can restore price stability without a gold standard. Cited in mega-spec D.1.5 as evidence that fiat regimes with independent CB can govern inflation.

Policy-content fingerprint — how the framework codes this movement on its axes

↓

monetary expansion direction

monetary.monetary_expansion_direction

Direction of monetary-base expansion decisions relative to trend. Separate from fiscal.transfer_expansion even when correlated.

decreased · strong

contractionary (balance sheet shrink, rates above Taylor)

Real Fed Funds rate > 6% sustained; money-supply targeting.

↑

central bank independence

monetary.central_bank_independence

De jure and de facto independence of the central bank from fiscal authority. Per D.1.5 scope, one of the framework's defensible monetary positions.

increased · strong

greater independence (legal, operational, personnel)

Volcker established precedent of CB resisting political pressure.

Policies enacted

· us_fed_funds_rate_spike_1979_1981
· us_monetary_targeting_shift_1979
· us_volcker_disinflation_1979_1982

What the data says — linked outcome hypotheses

The movement's outcome claims are tied to these hypotheses. Verdicts update as models run.

inconclusive

hyperinflation_requires_fiscal_dominance

INCONCLUSIVE_DATA_PENDING — no outcome variable loaded; missing: ['hanke:hyperinflation_table']

supported

fiat_expansion_erodes_currency_purchasing_power_long_run

SUPPORTED — 7/7 fiat currencies lost purchasing power against at least one hard-asset benchmark

Schools of thought aligned or opposed

aligned

chicago_monetarism

References

Volcker, Keeping At It (2018)
Goodfriend-King (2005) 'The Incredible Volcker Disinflation'