Measured In Gold, The Story Of American Wages Is An Ugly One
...The bottom line is that, in terms of gold, wages have fallen by about 87 percent. To get a stronger sense of what that means, consider that back in 1965, the minimum wage was 71 ounces of gold per year. In 2011, the senior engineer earned the equivalent of 63 ounces in gold. So, measured in gold, we see that senior engineers now earn less than what unskilled laborers earned back in 1965.
That’s right: today’s highly skilled professional is making less in real, comparative terms than yesterday’s unskilled worker.
When measured in dollars, wages and prices appear to be rising and, comparing wages to prices, we see only a small loss of purchasing power. However, prices do not tell the whole story, because they reveal nothing about costs. Costs also fell and this explains why the apparent drop in the real wages seems small.
But measured in gold—and this is crucial to understanding why we need a gold standard—we see reality with clarity. Incomes are about one tenth what they were in the 60’s. Prices are down too, but not as much....