Communist states that remove the reward incentive for hard work eventually collapse and fail. I have written articles before about this ranging from an article on Thanksgiving (Plymouth Colony was initially communist, until massive starvation deaths followed the end of hard work; for when some farmers started to slack off, others got jealous and angry and they stopped working hard – knowing all would get an equal share in the fall… and it turned out to be equal shares of very little) to starvation in Russia and Ukraine prior to WWII, to Venezuela today:
Credit Meridith Kohut for The New York Times
But we may be headed down the same path in America today – away from the true capitalism we once had, towards more and more socialism, spending the fruits of past labor and denying the rewards of future labor to those who should earn it. Socialist redistribution is responsible for a part of this; but the abuse of our currency through the corrupt Federal Reserve is largely to blame for the problem of price inflation and falling standards of living. Its private banking owners have been in bed with our politicians for decades, stealing from the masses through inflation.
True price inflation averages at least 7-8% annually – often substantially more in crucial areas like housing, health insurance, and school tuition… while income and raises tend to increase a mere 1-2% per year. A detailed comparison of the long term trends in New York and London show almost identical financial trends on both sides of the Atlantic. Do our governments admit there is a huge gap between income and costs, and acknowledge a falling stand of living? Of course not! They lie like crazy about CPI (Consumer Price Index/Inflation) and change the categories of components compared over time (steak shifts to hamburger, etc.) to mask the fact that Western workers are working more for less than they have in many decades.
To quote a friend’s research: “Historically, a British pound was a quarter ounce of gold, while a dollar was 1/20th an ounce of gold. Just based on that, you would say that in 1880, one pound = $300. But that actually doesn’t agree with the costs of living. At that time, a single person lived well on 60 pounds a year, while a professional earned around 100 pounds a year and up, and a typical low end apartment rent in London was roughly a pound a month. That alone as a rough comparison would suggest a pound in 1880 was equal to $1000 in my home town in America circa 2005, and about $2,000 in 2018*.
While it’s hard to compare equivalent rent and cost of living across time, I’ve looked at most prices of goods in London in 1880 and the $1,000-$2,000/pound figure seems fairly accurate. Which is why the big currency then was shillings = 1/20 of a pound, or around $100.
Why do I bring this up? Because England has been running their own consumer price index since 1750, and they would say a pound at that time was equivalent to just $100 now! Implying that a wealthy Londoner today could live on $10,000/year. In other words, the world over, consumer price indexes always lie about inflation.”
“…roughly a century and a half ago, the typical wages of a laborer in New York City was about a dollar a day, while in London a laborer made about a pound a week, and at that time the exchange rate was 5 dollars/pound, meaning that the cost of living in NYC and London were almost identical! [The currencies at that time were defined as various fractions of an ounce of gold] …an implication of my research below is that the real value of gold has changed significantly over the years.”
The causes are complex. Demand for labor has been falling with a trend towards automation and computerization and higher productivity per worker. At the same time skilled labor is less available, as more high school graduates come into the workforce with high expectations but minimal knowledge, experience, or skills. Not all have been raised as snowflakes, but far too many reach the age of adulthood without adequate preparation for independence or productive work.
We should also ask: are falling real wages and standards of living in the West a deliberate attempt by corporations and governments to equalize global labor rates? Production doesn’t have to shift to the Third World if First World labor rates fall a few per cent each year for decades… soon labor in China, Vietnam, Brazil, Pakistan – will be the same as in America, Britain, or Australia.
Personally I expect currency collapse, most significantly dollar collapse, followed by hyperinflation as people lose faith in government promises – which is the only backing dollars and pounds and most other currencies have. I expect an eventual return to a gold standard where precious metals back a currency with an inherent value higher than toilet paper, along with social turmoil and WWIII. My recent books describe various aspects of the future I see in the next decade or so, based on a combination of trends, historical comparisons, science, and expectations based on prophecy.
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