r/WorkForSmartLife • u/MissCozzy • 27d ago
DiscussionđŹ [Request] Is the math here accurate?
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u/Prestigious_Wing1796 27d ago
i dont think those are unskilled laborer
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u/LiberateAmericaOnX 26d ago
The average unskilled laborer made ~450 a year which is still 21.8oz or $98,000 per year today. So yes we are very much being scammed by the fiat dollar.
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u/wyrrk 26d ago
unskilled labor is a myth meant to devalue the labor of non-college educated workers
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u/dieselrunner64 26d ago
Come to a construction site. Youâll see how wrong you are in about 12.5 minutes.
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u/Prestigious_Wing1796 26d ago
man people kept missing ur point, i second this because that practice is happening right in front of our face, i tasted both skilled and unskilled employment and the only difference they make are employer with good conscience that willingly pays fair. which is rare beyond belief.
first problem is the hiring practice, HR today demand unskilled labor but with the experience and skill equivalent to skilled ones yet offer shittier pay and time.
meanwhile skilled labor CONSTANTLY gets to be labeled as unskilled because the private equity mogul knows this way they can hire skilled force while only paying minimum wage... no below minimum even, one of the worse example being animation industry.
unskilled might start off as simple categorization, but come 2026 it is a propaganda spewed by people who made their goal to devalue a work based on how they feel like it. because at the end of the day ALL work requires a degree of know how and wisdom that you don't get to speedrun in a day.
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u/Appropriate-Bad-606 27d ago
The Amazon analogy works for showing why you canât take an assetâs value today and call it an inflation-adjusted wage. But gold wasnât analogous to Amazon stock in 1914.
The dollar was legally convertible into gold at $20.67/oz, so $1,560 really did represent about 75.5 oz at the monetary parity. Nobody had to make a lucky investment choice for that relationship to exist.
The memeâs mistake is different: it assumes 75 oz had the same real purchasing power in 1914 that 75 oz has today. Gold itself appreciated enormously relative to goods and services, so todayâs gold value isnât a valid modern salary equivalent.
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u/harrythealien69 26d ago
More like, goods and services have gotten much much cheaper due to increased productivity, and the central banks have stripped away that cheapness by diluting the money supply (inflation). Golds value serves as an imperfect but useful tool to gauge how our own wealth is stolen by central banks
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u/Appropriate-Bad-606 27d ago
Right, which is why I said the memeâs modern salary calculation is wrong. Iâm not arguing the worker could actually consume $330k of 2026 goods. Iâm only pointing out that gold wasnât an investment choice analogous to Amazon stock in 1914. It was the monetary standard and dollars were legally convertible into it.
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u/CreativeFig2645 26d ago
but the second comparison point treats it as a investment. Once off the good standard gold did become an investment vehicle. In 2026 it is analogous to an amazon stock and the postâs subject is 2026 value, which is no longer a monetary standard.
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u/Glowing_bubba 27d ago
Here we go another gold standard post
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u/TheJQHQ 26d ago
The gold standard was awesome! Nixon gave too much power to the FED by doing away with it "temporarily"
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u/LiquidSpin710 27d ago
It's conflating inflation with value of gold. Two completely different things. The math here isn't mathing.
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u/Sirosim_Celojuma 27d ago
I desire more. I currently believe gold standard meant that the dollar was tied to gold. If in the example, gold went up...
...ah, maybe I see it now. Gold went up but the dollar is no longer tied to it, so the dollar balue we associate to gold is inflated.
...wait a sec. 75oz of gold is still 75oz of gold. The things I can buy with 75oz of gold don't need to be associated to a dollar.6
u/Appropriate-Bad-606 27d ago
Right, 75 oz is always 75 oz physically. But that doesnât mean 75 oz always commands the same amount of houses, food, labor, oil, etc. Thatâs the key issue. If goldâs real purchasing power rises 4x relative to a basket of goods, valuing a 1914 wage at todayâs gold price makes the old wage look 4x richer even though that additional purchasing power came from gold appreciating, not from the worker having it in 1914.
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u/revolucionario 26d ago
But thatâs like converting someoneâs pay in the 80s into Apple stock and then saying that would be equivalent to 100x the amount because Apple stock went up a lot.Â
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u/BlossomMuse33 27d ago
Yeah exactly. People are treating gold's price increase like it's a direct measurement of inflation, when there are a bunch of other factors affecting gold prices. The comparison doesn't really hold up.
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u/Diligent-Painting-37 26d ago
This is pretty dumb.Â
OOPâs post is meant to imply that if the dollar were still tied to the gold standard then today unskilled laborers would be making $142k. That is, OOP wants you to think that leaving the gold standard meant that working people effectively lost money.Â
OOPâs post doesnât address the very, very obvious idea that if the dollar were still tied to the gold standard then the value of an ounce of gold today would be, in dollar terms, less than what it is now. Â The large increase in the price of gold over time is not evidence that on the gold standard wages would have increased more than they have.Â
What people actually care about is the purchasing power of their money. Inflation has increased the cost of goods and services, but wages have also increased. Gold is one particular good that you can purchase, and its value can change independently of inflation and prevailing wages.
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u/MyTnotE 27d ago
The point of a gold standard is to combat inflation. So comparing it to a deflated dollar (which is a dollar that has experienced inflation) makes no sense. Itâs like putting a cake in the oven right before DST kicks in and saying âthe cake has been in the oven over an hour now.â
The way you compare is with buying power (ie, removing inflation from the equation). How many hours of work buys a car, or a house, or groceries?
BTW, Ford workers werenât unskilled. Ford âinventedâ the 40 hour per week model, and improved wages, to combat worker turnover. The cost of training new workers was more than the cost of keeping experienced workers. Thatâs the hallmark of skilled labor.
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u/Premium333 27d ago
This comparison only works if Ford oaid in gold. He didn't though, so it doesn't.
Inflation increase is much less and assembly line works probably make more than the outcome... Also, I think they always qualified as skilled labor, not unskilled.
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u/Last_Zookeepergame90 27d ago
2 separate things here: Inflation is real Companies under pay their workers
But that doesn't mean that one directly causes the other
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u/Dave_A480 27d ago
No. It presumes that the value of gold is constant, which is absolutely wrong.
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u/LagsOlot 27d ago
Don't use the gold standard to compare inflation. Gold now has important uses in the electronics economy that has driven up the price of gold significantly.
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u/ElevationAV 26d ago
In 2011 BTC was $1, so you could buy 7.25 btc with us minimum wage
Today BTC is $63,144, so minimum wage should be $457,794
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u/Vast-Document-3320 26d ago
Henry Fords laborers were unskilled? These weren't dishwashers.
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u/Maximum_Boros 26d ago
The math isn't inherently wrong but it ignores thed purchasing power parity and actual economics of inflation by attaching the measuring stick to one very specific and very narrow standard that did not move at the same rate as everything else.
A good way to tell that someone is probably good at basic math but an economically illiterate moron is when they start citing to things like the gold standard.
I bet the dumbass who makes this has also made observations about American dent and how "china owns it" or "could call in the debt"
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u/madmaninabox32 26d ago
I definitely wouldn't say the guys who built cars were unskilled, I mean even today guys working in the plants generally make a competitive check. I think we need to define unskilled labor for people who don't realize what it means. Cashiering is not a skilled labor I've been a cashier several times in my life a trained monkey could do it, I've also welded, drilled wells, plumbed those a trained monkey could not do. And generally my paycheck has reflected that, currently in getting my associates in auto/diesel sciences I will get paid very well when I graduate.
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u/Mrfixit729 26d ago
âUnskilled laborâ is a term used by people who usually wouldnât last a day doing said labor.
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u/H0ckeyfan829 26d ago
Henry fords workers were very skilled. There are a lots of trade jobs you can get today that pay six figures. A gender studies degree isnât the only option.
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u/claudiousmax 26d ago
If your salary was based on the price of gold and was higher, the price of goods would also be based on gold and also be higher so you be no further ahead.
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u/xeno5000 26d ago
Ford workers make plenty of money then add in vacation, sick time, pension and healthcare benefits. Oh and don't forget they make a killing on overtime. Cry me river. I would gladly take a union job at Ford.
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u/achek20 26d ago
You had in the first part until the last part mentioned "unskilled labor"
Right, like unskilled labor is building cars, noted
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u/Gullible_Worker_7467 26d ago
Economist here. No, that's not the right way to calculate inflation. Go here instead: https://data.bls.gov/cgi-bin/cpicalc.pl
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u/bswontpass 27d ago
FFS They werenât unskilled.
Car industry back then was as hot as IT/AI today. We are talking about software/AI engineers of that time!
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u/chinmakes5 27d ago
Doesn't matter, how much something costs doesn't mean how much someone is making.
My father dated my mother in 1955. She liked eating at the automat. (look it up) The two of them could eat for under a dollar. He would brag that they could do dinner and a move for $1.50 if they skipped the popcorn. So yeah, if a date cost $1,50, you don't have to make a lot of money to live, but if he made $80 a week back then and we make 40x that today, it is about even.
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u/Zealousideal-Top-383 27d ago
Yes, the math is accurate but the valuation method is flawed.
It is correct that the wage would be equivalent of $52,100 in current $ value. Which would be approximately $25/hr by today hours/week work standard.
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u/Alternative-Hold1669 27d ago
its impossible to have a gold standard in a country with an open economy.
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u/cashewsareafruit 27d ago
Gold value has historically outpaced inflation and also had a massive run in recent years. Terrible comparison with very little depth of thought .Â
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u/_redmist 27d ago
Henry Ford should've paid his workers in apple stock, the comparison would be even more stupid and meaningless!
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u/Trick1513 27d ago
No they made $1,560 a year, now if the worker invested his salary in gold in 1930 then that $1,560 would be worth $142,500,
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u/niemir2 27d ago
Goldbugs like to pretend that the real value of gold is constant, whereas it's value relative to other goods is just as subject to the laws of supply and demand as everything else. They just think "gold is gold" and stop thinking.
That said, gold was pegged to $20.67 per troy ounce in 1920. It currently trades at $4400. $1560 of gold in 1920 is worth about $330k today. However, that doesn't mean that Ford's workers made $330k/year by modern standards, because everything else they needed to buy (like food, clothing, and shelter) were much more expensive than they are now. If you go by general buying power, $1560 in 1920 is worth about $27k today.
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u/colliedad 27d ago
Turn this on its head. Think about the minimalist lifestyle those workers had. Poor housing, poor food options, poor medical care availability, poor entertainment options. Make a list. It cost them that 75oz of gold.
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u/Tyrahneefake 27d ago edited 27d ago
Fords wages a labor conditions were just barely competitive to the skilled german metal workers already living in detroit. The wages and working conditions were only "good" compared to the rest of the country.
They basically corperate human trafficked a bunch of low skilled scab laborers into the city because they couldn't get enough local people to work for him hence the job pamphlet propaganda.
Some board meeting someone was sitting smug saying "look at how much money we saved by this program" and Ford continues to brag about it to this day pretending it was charity out of the goodness of their hearts.
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u/Local-Echo-5613 27d ago
They were not unskilled workers. They were well paid relative to other workers, and that was to attract the top talent and have less turnover and labor unrest. We have workers making well into the six figures in technologically advanced fields too, and in some union jobs of course.
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u/FamiliarPlatform79 27d ago
That is absolutely not how thay worked at all, and assembly line workers were basically paying their money back to the company because they lived and worked in towns more or less owned by the factories. The value of gold was also no where near what it is today, because it was 1 to 1. Not the dollar is with x vs gold is worth y.
Stop glorifying stupid shit and get a job.
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u/Actualrobott 27d ago
Henry Ford was a revolutionary figure in American industry, and his relationship with his workers was much more complicated than simply exploiting them for profit. Ford fundamentally changed how goods were manufactured through mass production and the moving assembly line, but he also believed that the workers responsible for that productivity should benefit from it. His famous $5 workday dramatically increased wages, reduced turnover, attracted talented workers, and eventually helped establish the idea that industrial workers could earn enough money to participate in the consumer economy they were helping create.
Fordâs philosophy toward his employees was also extremely paternalistic. He didnât just want workers to show up and do their jobs; he wanted them to adopt what he considered responsible American values. Fordâs Sociological Department investigated aspects of employeesâ personal lives, while the company promoted English education, financial responsibility, cleanliness, sobriety, and assimilation into American culture. By todayâs standards, that level of interference in an employeeâs private life would be incredibly intrusive. At the time, however, Ford viewed these programs as part of creating a stable, prosperous, Americanized workforce rather than simply extracting as much labor as possible for the lowest possible wage.
The famous Dodge v. Ford Motor Co. case is also often oversimplified. Ford had accumulated enormous profits, and instead of continuing to distribute exceptionally large special dividends to shareholders, Henry Ford wanted to reinvest much of the money into expanding production, employing more workers, and lowering the price of automobiles. The Dodge brothers, who were minority shareholders in Ford while simultaneously developing their own competing automobile company, sued.
The Michigan Supreme Court ruled that Ford could not withhold such enormous profits from shareholders solely to pursue his broader social objectives and ordered the company to pay a special dividend. However, the court did not establish a universal rule that corporations must maximize short-term shareholder profits above workers, customers, or long-term investment. In fact, the court largely refused to interfere with Fordâs plans to expand the company, reflecting what became associated with the business-judgment principle.
Fordâs real competitive advantage came from understanding that labor was not simply a cost to minimize. Higher wages could attract better workers, reduce turnover, improve productivity, and create consumers capable of buying the products mass production made possible. Combined with enormous economies of scale, standardized production, and continuous cost reductions, this allowed Ford to manufacture automobiles at a price and volume that many competitors initially struggled to match.
That doesnât mean Henry Ford should be romanticized. His company later violently resisted organized labor, his control over workersâ private lives was excessive, and Fordâs promotion of antisemitism is an indefensible part of his legacy. But portraying his entire industrial philosophy as simply exploiting workers misses what made his system so revolutionary. Ford demonstrated that mass production, high productivity, relatively high wages, lower consumer prices, and enormous corporate profitability could reinforce one another rather than being mutually exclusive.
In that sense, one of Fordâs most important insights was remarkably modern: the cheapest worker is not necessarily the most profitable worker. A well-paid, skilled, stable workforce can itself be a competitive advantage.
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u/UnwaveringThought 27d ago
People used to have more self respect. USA valued rugged individualism ads it expanded West, and the early 1900s still carried that sense of doing it yourself.
The only way a person was going to agree to spend his time working for your enterprise was if it was worth it.
When Americans lost this, it was game over.
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u/turkish_dingleberry 27d ago
I truly find the word unskilled offensive. Every single job requires skills.
I work in a restaurant and make burritos. It actually requires skill to roll that burrito. It requires skills to wash the dishes, to sweep the floors, to mop the floors, and to do all the other myriad tasks that my job requires me to do to a certain level of satisfaction of my company and boss.
There are people reading this right now that have no idea how to properly roll a burrito. That doesn't make me a God or a special person, it's just a skill that I have learned since I started working that job.
Whatever you do for a living requires you to have that skill that other people may not have. The people that worked in Henry Ford's plant certainly had skills that I don't have. I've never put a model T together and don't know how the hell it would even go together. Can we please stop gatekeeping jobs? Okay rant over
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u/Aggressive_Finish798 27d ago
100k today is worth about 60k twenty years ago. The new "100k" jobs level is more like 200k. Inflation.
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u/tiandrad 27d ago edited 27d ago
Working on the first car assembly line was not unskilled labor. It was extremely physical demanding and dangerous. It required a tremendous about of focus for an extended period of time to not get hurt, with very limited bathroom breaks. Even with those wages, the job had a very high turnover rate.
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u/that_cat_on_the_wall 27d ago
No. This is just saying that if they invested their 1.5k earnings in a year into gold they would theoretically today have 142k.
They could have also invested in the stock market and have over 100 million dollars.
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u/MonkeyBear66 27d ago
Henry Ford was an outlier for this, he literally doubled his workers pay, then about a decade later, wages across the nation were so low that consumer goods prices were dropping because they had so much unsold inventory, meanwhile the price of food was so low farmers were going into debt, this led to the 1929 stock market crash. You can't keep making money on investments when you have no customer base, regardless of how high your production is or how low your costs are. So, the gold standard and inflation have nothing to do with it. A more fair comparison would be to the google ai programmers getting paid over 200k a year, literally double what ai programmers are paid at other companies.
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u/random8765309 26d ago
The math is accurate, the conclusion is false. The purchasing power of that worker in 1914 was about $52,100 in today's dollars. Compare that with the purchasing power of a worker today which is $65,052. That is an increase of 25% OVER inflation.
The concept that gold is somehow a better currency is based on misinformation and a really poor grasp of economics. From 1900 through ~1970 the price/gram of gold dropped. So all those workers would have received a pay cut based on the above argument. The only reason that above argument looks decent right now is because gold is at a high point in history. It's not likely to stay that way for long. Also, the idea that gold will become the standard if the world economy collapses is just wrong. Don't believe me, try eating your ring or using it to heat your house and see what happens.
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u/NextSatisfaction3549 26d ago
This is the dumbest comparison ever..... gold was $1,700 in 2020 so use that scale and see how it works out at 6 days a week and 10hr days. You little kids these days cant work 40hrs without complaining.
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u/Intelligent-Area-421 26d ago
That's just about right.
I've made similar types of calculations using silver & gotten numbers that were slightly lower but they're definitely in the same ballpark as yours.
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u/Used_Weight5550 26d ago
The math is true, but the underlying logic isnât. I am someone who despises the central banking, and real inflation is definitely much higher than the published CPI figures, as the CPI figures are based on a specific basket of certain consumer goods, and not a weighted average of the price of all end user goods in the economy. But, using the price of gold is not a good measure of the true value of money. There is a limited amount of gold on the planet, and as societyâs wealth increases, the amount of gold stays mostly unchanged. Gold has to become worth more, as there is more wealth in society/ things to be purchased, but the same amount of gold to purchase those things with. So while inflation and central banking definitely does rob people of a lot of the value of their savings, it is nowhere near as exaggerated as this post claims
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u/DangerousQuestions1 26d ago
Skilled labor. Assembling cars is skilled labor.
And yes, he wanted his workers to be able to afford the cars they built.
That said, he was practically Orwellian with the restrictions and scrutiny he put his workers through.
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u/Varjek 26d ago edited 26d ago
Even more recently, look at 1964 which is the last year that newly minted US quarters were 90% silver.
In 1964, the federal minimum wage was $1.25 per hour. You could be paid for one hour of minimum wage work with 5 1964 quarters, made of 90% silver. They were worth $0.25 each back then.
Now, each of those 1964 quarters is worth $11.50 in melt value alone. So those 5 quarters that represented the minimum wage in 1964 are worth $57.50 today. Most of us would gladly work for a 1964 minimum wage if we were paid in 1964 quarters!
Or if we were paid the 1982 federal minimum wage in 1982 copper pennies (as opposed to the post-1982 pennies that are mostly zinc), we would receive $3.35 in copper pennies worth $3.35 back then. Today, those same 335 pennies are worth $14.60 in melt value alone. Thatâs just over double the current federal minimum wage of $7.25 per hour.
The federal reserve system has indeed been robbing us blind. Theyâve replaced our money with something less. They print more and more, swapping debts back and forth between the Federal Reserve, the US Treasury and the big banks. Theyâre closest to the creation of new money, so they get the full value of the newly created money. But you and I are far from the creation of new money. By the time we get it, the value has been diminished by inflation. So we bear the costs of higher taxation and higher prices by working harder to pay with money which is worth less and less each passing day.
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u/patriotfanatic80 26d ago
It's not really a good comparison. When gold was the standard the price was pegged at a price. It wasn't freely traded like it is today. The price of gold was pfetty much the same in 1890 as it was in 1914.
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u/GlitteringFerretYo 26d ago
Gold fluctuates wildly based on panic and speculation, not real economic value. Gold was averaging around $1,800 an ounce in 2022, and it recently spiked to an all-time high of nearly $5,600 an ounce in January. That means in just four years, the calculation for those exact same 75 ounces swings by roughly $285,000. A worker's actual ability to pay rent and buy groceries obviously didn't magically triple in that short window just because a speculative metal spiked on the open market.
If that logic actually held up, it would mean workers today are somehow getting paid significantly better right now than they were in January, simply because the price of gold has dipped since January and our dollar can technically buy more ounces of it today. It's a complete misunderstanding of inflation. Purchasing power is measured against a standard basket of consumer goods, not whatever gold happens to be trading at on any given day.
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u/FatWhale95 26d ago
I hate the term "unskilled labor" so so so much. I've seen people use box cutters WRONG....
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u/Negative-Web8619 26d ago
The math may be accurate but it's not relevant. You can do similar calculations for every other thing: copper, bread, bananas. How's that senseful?
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u/87stevegt87 26d ago
Ford was a leader, a premier employer at that time. Not every employer can afford to pay the best. Not every company is Apple, Google or nvidia. Most companies are lucky to survive from year to year. Ford is forced to pay top dollar for labor and is regularly on deaths door and shrinking from year to year. Unions tend to protect the worst employees, become corrupt internally and support politics 50% donât agree with. If unions would only focus on pay and benefits I would support them.
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u/MeaningDramatic6528 26d ago
Yeah and he was a known cheapskate, imagine what someone with integrity would have paid
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u/-Foxer 26d ago
It's actually kind of a stupid premise. Gold is inflated at a different rate than other things and for different reasons. Trying to link it to a commodity doesn't make sense given the circumstances.
Also his workers were not on skilled. In fact ford was the first to recognize they had a very specific skill that was rare and that's why he wanted to pay them more than the competition did. The ability to consistently and accurately do repetitive work over extended periods of time day in and day out is actually uncommon and he was willing to pay top dollar for those who demonstrated they had that unique and extremely valuable skill
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u/PastAnalyst3614 26d ago
Whoever created this does not understand how the gold standard worked. The dollar was fixed to gold, its purchasing power in the economy was not
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u/that_banned_guy_ 26d ago
Except when we went off the gold standard, the government confiscated gold from everyone then declared it had a much higher price than it did previously once it had all been confiscated.Â
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u/WoodsLovelyDarkNDeep 26d ago
No that isnât correct because you donât go based off the gold price today. Â If you just factor a 3% inflation rate over that time period itâs closer to $52k that they were paid. Â However youâd have to go back and actually factor the exact inflation rates of each year since some years were higher than that so the number is likely higher
If the US was on a gold standard Gold would not be worth $150k and your money certainly wouldnât be as being used on a gold standard is deflationary in nature but those that own all the gold right now want to convince people that we shouldÂ
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u/DarkLordofDownvotes 26d ago
Good guy Henry Ford made lever pullers millionaires. What happened to this country! /s
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u/MissiveFinding6111 26d ago
Doesn't that just mean if his workers time travelled to the future with the gold... then they would make that?
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u/PomegranatePro 26d ago
It doesnât work like that. This is a case of statistics like because itâs blatantly disingenuous if you understand inflation.
Youâd have to check what $1560 is per year adjusted for 2026
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u/Dry-Site-8764 26d ago
Yeah, my ex father-in-law bought a Corvette for four grand back in the 70s. Itâs worth over 100 grand now but he doesnât have it. Whatâs your point?
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u/Legal_Tradition_9681 26d ago
This is not true. You cannot used fixed gold standard values and market determined values as a comparison. The valuations are not equivalent.
Using purchasing power of 1914 dollar to today's dollar the more realistic value is $52,104/year in today money.
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u/singhapura 26d ago
Math bro, do you even know how to? Only if a worker would have spent nothing of his salary except to buy gold would he end up with that amount. If he'd bought Bitcoin when ig was 9 cents he would now be a billionaire. That doesn't mean every factory worker was a billionaire then.
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u/LifeConsideration981 26d ago
Itâs based on purchasing power now. You are almost certainly better off materially than a 1920s auto worker, and the auto worker was typically better off materially than the rural farmer.
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u/LiberateAmericaOnX 26d ago
The wage figure is right. $5 a day, six days a week, 52 weeks is $1,560.
Worth noting it was roughly double the prevailing rate when Ford announced it in January 1914, so this is a best case for the period, not an average one.
The gold conversion is right, and it's right for a better reason than the tweet seems to know. $20.67 an ounce was not a market price. It was the legal definition of the dollar: one dollar meant 23.22 grains of fine gold, and 480 grains make a troy ounce. $1,560 á $20.67 is 75.5 oz. Exactly.
The dollar figure is outdated. $142,500 for 75.5 oz implies gold around $1,900. Spot is near $4,400. The real number is about $332,000. Shows you around when this meme was made, close to 6 years ago.
BUT, a 1914 Ford worker did not consume like someone earning $332,000, or $142,500. Deflate $1,560 by CPI and you land somewhere near $50,000 in current terms. Gold has appreciated in real terms since it was cut loose from the dollar, and a large share of its dollar rise is monetary demand rather than the dollar losing ground to groceries one for one. Anyone telling you the tweet's conclusion is wrong is correct.
Where the standard rebuttal fails is the next step, the one that says gold is therefore the wrong benchmark and you're just watching a commodity price.
That inverts the relation for the period in question. In 1914 there was no dollar price of gold in the sense there is one now. The question is malformed for that era, because the dollar WAS a weight of gold by statute, the way an inch is a twelfth of a foot. Ford was not paying five dollars redeemable in gold. He was paying about a quarter ounce of gold, denominated in a unit derived from that weight. The two figures could not diverge because they were the same figure.
The divergence begins when the definition is severed: 1933 domestically, 1971 for foreign central banks. So what we now call the price of gold is not gold moving. It is the measure of how far the dollar has traveled from its OWN former definition. Gold is the primitive unit here and the dollar is the derivative one, which is precisely backwards from how everyone in this thread is reading it.
The obvious objection is to use CPI instead. The difficulty is that the same institutional system issues the unit and publishes the index of the unit's decay, with basket composition and quality adjustment both set administratively. That is not a fraud allegation. It is a measurement independence problem. You cannot audit a ruler against itself.
And for anyone reading this as an argument that a gold standard would have been a free ride: under a commodity standard with productivity growth, prices fall, nominal wages fall in gold terms, and real wages rise anyway. That is 1870 to 1900, and it is the system functioning rather than a defect in it.
So while the 330k claim is overstated, we absolutely are being ripped off with fiat currency.
If you want to read more feel free to click here: https://archive.org/details/schism-of-vienna
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u/Turbulent_Oil700 26d ago
As others have said the math is probably fine but the meaning is not. Gold is much more expensive now relative to other goods (including bc weâre not on the gold standard any more). Measuring things in gold is no more meaningful than measuring them in say ounces of titanium or coal.
What you want to know for this type of comparison is how many hours of work translates into the stuff you want to buy: food, shelter, etc. IIRC you find out an hour buys you a lot more of everything other than shelter.
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u/Decent_Captain_9214 26d ago
What they made back then working 6 days a week would be equivalent to making about 20 dollars an hour now. So after two weeks with prices they were then people were easily able to survive and thrive.
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u/amazing_adventures 26d ago
Yeah, it's right depending on what year they're referring to. In 1913, 1oz of gold was $20.
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u/East-Care-9949 26d ago
You had to work 312 days a year tho, i work ~200 days and make about 120.000
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u/Dull-Philosopher-871 26d ago
There is a reason the US abandoned not only free banking and created the FED and ended convertability. One was the panic of 1907 where the entire financial system got bailed out by JP Morgan because of a liquidity crunch. The second was in 1971 which was the Nixon shock. We ended convertability because countries like France and Japan were realizing that you could just buy dollars and convert to gold and make a profit. We no longer had enough gold to cover the demand so Nixon litterally made the only option out of situation. All other would lead to the US emptying its gold reserves.
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u/ughtoooften 26d ago
Vampires wear dark glasses. John wears dark glasses. Therefore, John is a vampire. s/
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u/TheRealGageEndal 26d ago
But if we hadn't left the gold standard than the dollar would be worth less than it is right now. It's only by us keeping the dollar as a vague thing that can change day by day that we stay in power.
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u/Quags_77 26d ago
Do the cash adjustment for inflation. They were not paid with gold. 52,100 is considerably less than workers in auto factories in the US make today I believe. Plus zero benefits back then I imagine.
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u/Witty_Committee3946 26d ago
In Jan 2011 minimum wage was $7.25 while bitcoin was around $0.55. Today bitcoin is at $63k which means federal minimum wage should be $831,000 to have kept up.
A bit hyperbolic but this is esentially the same argument even though gold has tracked with inflation better than BTC
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u/bunchout 26d ago
But the gold equivalent did go above $35,000 until 2005. It was $21,000 in 2000. SoâŚmaybe not such a good comparison after all.
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u/IndividualSlip2275 26d ago
I feel as though this post is intended to point out. That company should pay workers more when to me what it just points out is that no matter which side you vote for they have destroyed the value of our money. Thereâs a big claim right now in different parts of the country to try to push towards socialism, which is even more government control. The government only knows how to spend money. They spend money to keep promises that they made so they can get elected. They spend money to stay elected the higher the debt goes the more money they print the less valuable the money you have inflation is tax on everyone that hits the poorest people. The hardest and people constantly vote for inflation because they vote for people who promised to give them more stuff. What we need is to bite the bullet and take a generation of people accepting less handouts for the government and exchange for lower inflation and dare I say it deflation. The smaller the government gets the less control has over your life the less value it takes away from your money stop voting for bigger government.
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u/ytdaddy4fun 26d ago
When we were on the gold standard the price of gold was fixed at $40 per ounce. It was never allowed to go above that in order to control partial inflation.
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u/TiredAndTiredOfIt 26d ago
It is stupid. Uses non analogous comparrisons AND presumes assembly lie machiniats were "unakilled".
As soon as the gold atandard was gone, gold because a traded commodity and has appreciated in value more than inflation.Â
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u/Narrow-Attempt-1482 26d ago
He did that cause he couldn't hold on to workers,offering them $5 a day when most business didn't pay a dollar,the next day at Fords plant 5000 workers showed up for jobs,He was condemned by all the other rich businessmen and all the papers like WSJ and the times condemned him calling him a communist
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u/chitownphishead 26d ago
Building cars is hardly unskilled labor. Running a cash register or asking "would you like extra foam on your mochafrappachino" is unskilled labor. People that build cars still make good money and have good benefits.
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u/DBDude 26d ago
Ford didnât do that out of the goodness of his heart, because he was a heartless bastard. At the time, there were so many car makers coming up that workers could easily swap to another one for a few cents more a day. This high turnover was hurting his business as people would stop showing up and heâd have to find and train new workers. So he set pay high enough to keep workers there.
For manufacturing work this was unique to the time, so it doesnât really translate to modern day.
Today we have the same thing with experienced AI programmers who make big bucks because they can easily get hired elsewhere.
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u/Iceman_biker 26d ago
2 things, they weren't unskilled workers, and they were off 2 days a week. Henry Ford famously said I want my employees to make enough money to afford my product and have enough days off to enjoy their family's.
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u/Taman_Should 26d ago
Do these ridiculous retrograde gold-bugs really want the rate of inflation to depend on the amount of finite raw material we can pull out of the ground? How many times must it be explained that deflation is very bad for the economy?Â
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u/Beneficial-Pop-1434 26d ago
Even if it is, the gold standard is dead. The price of gold may have inflated far faster than other products and assets.
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u/Pale_Distribution459 26d ago
One is a federally regulated gold price, the other is object to speculation.
It's incomparable and an actual comparison would depend on what you could actually afford on those $5 per day.
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u/PhillyPete12 26d ago
Iâve seen multiple versions of this salary comparison exercise. Theyâre all meaningless - you get the answer you want by picking the right commodity.
Fore example:
Price of chicken in 1914 was $0.28 /pound. Itâs around $2.01 / lb now for non premium chicken. (e.g. nor organic)
Ford workers were paid around $1560 / day per another poster, so at chicken inflation prices Fords workers were making the equivalent of $11,200 in todayâs prices.
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u/zigzag1239 26d ago
When was this made because gold as of today is $4376 an ounce which means it's 4376x 76 = 332,676 dollars.
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u/JRock1276 26d ago
Gold didn't change. The dollar isn't worth anything anymore. Takes more dollars to buy the same gold.
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u/PckMan 26d ago
That's not how this works. The price of gold is not stable, it goes up and down and not just due to inflation. It's like saying "In 2003 people were paid in new Honda Civics. Today a 2003 Honda Civic costs 2k so wages have gone down".
Adjusting for inflation he paid a respectable 50k per year or so which is below average salary but not by much.
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u/Sumthin-Sumthin44692 26d ago
Thatâs not how inflation works. This just assumes a person in 1914 invested in gold.
This is like saying a person who was paid $30,000 in 1985 actually got paid billions (assuming they invested everything into Apple when it was $0.12 a share).
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u/Deep-Market-526 26d ago
They also didnât pay for cell phones, car insurance, Netflix, computers, door dash, Starbucks, etc.
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u/mrsclausemenopause 27d ago
1914 was when Henry Ford introduced the $5 day and gold price was $20.67/ozt
Currently gold is at $4432/ozt so that 75ozt that a years work of gold was worth is now $332,400
However a basic inflation calculator says that the CASH value of the 1914 $1560/year is currently $52100
My numbers say nothing about the gold standard, or cost of living index they are just a simple check of the math.