How did the economy keep consumer prices rising since the 80s?

 It has been slowly getting stable, but an average CPI hike of about 2% for 40 years seems like stress on the consumer.

It is stressful, and the regular CPI price hikes came with increasing wealth concentration. It seems we are pushing poor people to less consumption.  

Who dunnit it?  Look at WTF happened in 1971. By 1980 the dust had settled and the central bank became the government accommodator. 

It begin using the government rate as the standard.   That is when retail banking starts to stutter. Congress is not the liquidity model of the USA. The Fed and Treasury at that point became insurers against currency risk.   And slowly the higher risk were excluded from banking.

Currency risk paid for at the savings and loans, via interest swaps. It cannot be insured.  Hence there should be the minimum fee for bank accounts, and that is a very small on line transaction cost, regardless of risk level. The interest charges in retail and government may vary. The Fed cannot always direct liquidity to government first.

I consider this a minor blunder. Our first attempt at a real S/L currency bank, and it was OK. A bunch of stuff went wrong in 1971, but it is all repairable.  Government ir responsible for government and government has a tool called devaluation it can use separately. The Central Bank can act for quite a while on its own if it does not have the job of Treasury bailout. Take some losses for the blunder, make a New Few contract, let  the Treasury retain power of devaluation, and use it.  

I see nothing o freak out about,  in retrospect, was the Nixon devaluation really worth the hysteria?

Who picks the board for a New Fed with three times the independence, and a non profit mandate? The regulated Swift accounts in the Fed S/L pit. They are there under Due Process.  What does the board do? Execute Due Process by setting entry and exit fees to manage congestion, and pursuing universal personal smart card, and watching for fair trading pits in the sand box, and pursue scofflaws.

I am having a hard time seeing all the difficulty in fixing a lot of this. Treasury will not be violating the sanctity of government debt, they are receiving a fee, a tax

We are upgrading the Fed. Making it a bit more independent, handing the inflation tax back to government. Making more fair banking. Competing with shadow banking. We will not be gone, the Fed returns for renewal.  Revenue sharing with state capitals has been done, it works.   This will enlarge the tax base. Remove the primary dealer monopoly.  Government devaluation becomes a negotiation about every 15 years, the Fed is otherwise price neutral.  In fact, the devluation process left to Treasury along with an independent due process Fed means very little direct collaboration with Fed and Treasury.

The government bond market is on its own, the Fed S?L will  be cash in and out  It does not bet time.. This is mostly what is being proposed, and it is second generation.