In 1938 the Federal minimum wage was set at $0.25 an hour.
That's $4.34 in today's dollars.
In 1938 an ounce of gold was $35.
That's $607.49 in today's dollars.
Today the Federal minimum wage is $9.20.
That's $0.53 in 1938 dollars.
Today an ounce of gold is $1,241.60.
That's $71.53 in 1938 dollars.
In 1938 the fedmin was 0.71% an ounce of gold. Today it's 0.74%.
0.71% of today's gold prices is $8.87 an hour.
See, the minimum wage has kept pace with inflation!
Addendum:
$15 an hour today is $0.86 an hour in 1938 dollars.
It's 1.21% an ounce of gold today, 2.46% an ounce of gold in 1938.
It's important to remember that an ounce of gold has about the same absolute buying power today as it did in 1938 for many key goods. It's astonishing how steady its value has been, actually.
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Ah! But how do the prices of really important things, like beer, compare?
ReplyDeleteI don't have 1938 pint prices, but I do have 1952!
DeleteIn '52 the average price of a pint was 65¢ ($6 today). Gold was $38.70 ($357.40) an ounce, so a pint was 1.68% the price of gold.
Today the average price of a pint is $3.99 (43¢ in '52) or 0.32% the price of gold.
Craft beer averages more like $7 a pint, or 76¢ in '52 or 0.56% the price of gold.
Beer is cheaper now than then because it's cheaper to grow the ingredients than it used to be and it's cheaper to transport than it used to be.
I saw one of these comparing a loaf of bread and the price of a basic standard automobile to gold. And the price for those things in gold stayed pretty constant; we apparently never actually left the gold standard, we just stopped admitting to it.
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