What 70 Hard-Won Greenbacks Will Buy Today

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When the spring semester at the University of Colorado let out several weeks ago, I called a good friend (and fellow Denver Barbarian) to see if I might be able to work for him during my summer break as I had done last summer. My friend, who owns a residential and commercial roofing company in Denver, agreed to reinstate me on one of his crews, and I began working for him five days after my last final exam.

It has been my habit since my freshman year in high school to take a summer job in one of the various landscaping or construction trades, and my return to this type of work felt inexpressibly refreshing and liberating after fifteen weeks of physical idleness and monotonous study in graduate school. It was, moreover, intensely satisfying to be earning a regular paycheck once again by means of the strength and skill of my hands under the clear summer sun — despite the total physical exhaustion that the roofing profession entails. There is perhaps nothing more personally satisfying than the paycheck that is earned by means of physical labor that, while backbreaking, produces a tangible product that so thoroughly satisfies one's customers. (The same cannot be said of the graduate student, whose teaching "services" — if they can rightly be called that — are usually detested by the supposed consumers/undergraduates, and who lives, in a public university, solely at the taxpayer's expense).

It only took several weeks of roofing however, before I noticed that my paychecks were much less satisfying to me this summer than they were just one year ago. The problem was not that my wages were nominally any lower than they were last year, or that I was working fewer hours. On the contrary, I was actually working more hours now at a slightly higher nominal rate.

The problem was (and is) that the greenbacks I'm unfortunately paid with are buying me fewer and fewer goods (which is, in effect, equivalent to receiving a concealed pay-cut for the same amount of backbreaking work after just one year).

What awakened me to the precipitous decline in my greenbacks' value (and the pay-cut this decline in value entailed for my standard of living) was a simple tallying of my expenses for one ordinary Friday afternoon. After perusing my bank records, I noticed that I had spent $70 in the course of six hours one Friday, and I sought to discover how I could have spent so much money on a totally unexceptional weekday. Here is what I discovered my hard-won $70 had been exchanged for:

Two cheeseburgers, French fries, and a small drink (lunch)

$6.50

Four tins of Skoal snuff $22.50 Two chicken sandwiches and a small French fries (dinner) $7.50 One twelve-pack of cheap beer (it was Friday, after all) $14.50 Six gallons of regular gasoline $19.00

Imagine the disgust and frustration I felt after surveying the sum of these appalling prices, when my average pre-tax income as a roofer is approximately $120 per day. More than half of my income, (i.e., around five hours of labor), that Friday was required to purchase only four ounces of tobacco, 144 ounces of cheap beer, six gallons of petrol, and less than two pounds of low-quality, greasy food. I felt very much like young Tom in Steinbeck's The Grapes of Wrath, who finds himself in the hopeless position of working all day at a backbreaking job only to find that his meager wages will scarcely purchase enough food and gasoline to allow him to get to work the following day.

Last summer these same quantities of tobacco, cheap ale, gasoline, and low quality, greasy food cost me approximately 20% less than they do today. Put even more starkly, after just one year, these same quantities of beer, tobacco, food and gasoline now require an additional hour of backbreaking labor on a roof to procure! What is even worse, when I first started working in the construction trades twelve years ago, a gallon of gasoline cost me 98 cents, a tin of smokeless tobacco cost me two dollars (including the ridiculously high and totally unjustifiable taxes on the then-newly-demonized smokeless tobacco), and a greasy cheeseburger cost me 50 cents. I could buy a twelve-pack of decent beer (i.e., Fat Tire, for a Colorado boy like me) for only nine dollars.

My frustration and disgust only increased after I tallied the total number of additional hours that were required to purchase my new Springfield M1A rifle, which cost me 1,500 greenbacks two weeks ago (after the revoltingly high sales tax was tacked on). This same rifle only a handful years ago was running around $1200, which means that my new rifle cost me an additional 20 hours of labor to procure (i.e., an additional half-week of grueling labor on a roof!), compared to what it would have cost me only a few years ago.

What made these rising prices all the more frightening and maddening to me is the fact that I am only 28 years old. I'm not a 96-year-old veteran of World War II, regaling my grandchildren with tales of $500 Model T's, five-cent candy bars, and ten-cent cigars. Nor am I a veteran of the Vietnam War, who remembers that M14's could be had in the 1970's for only a couple of hundred dollars. In fact, I'm probably young enough to be the grandchild of many of my readers — I wasn't even born until the Vietnam War was over! Inflation is not a far-off and now obsolete threat to our wealth and standard of living. It is, on the contrary, an all-too real, yet often forgotten and more often misdiagnosed, drain on our hard-won paychecks and savings accounts.

The perpetrator of this wretched decline in my paychecks' value is the Federal Reserve Bank of the United States. This unelected and almost completely ungoverned institution continues to flood the U.S. and global economies with ever more green pieces of paper every year, which inexorably causes each individual unit of currency to fall in value. For those of us who are not able to renegotiate our wages every week or month to keep pace with this irresponsible inflation, the deluge of currency literally results in continuous pay cuts.

The consequence of this fall in the value of the greenbacks with which I am paid every week should also be obvious: I have either to work more hours on a roof to obtain the same amount of goods as I did just one year ago, or I have to make do with the fewer goods the depleted green paper with which I am paid will purchase. While either one of these options represents a fall in my standard of living, I am usually forced, due to the physical exhaustion from roofing, to make do with fewer and fewer goods, since I can only physically work so many grueling hours of overtime in a single week.

Another baneful consequence of this deluge of currency caused by the Fed is that certain sectors of the economy get bloated with the new currency (i.e., a bubble), pushing the prices of the products of those industries even more out of reach of average wage earners like myself. In the recent housing bubble, for example, (which was caused by a massive and long-lived release of new currency into the mortgage lending industry), the price of almost all homes and building materials in Denver soared to unfathomable levels. The average worker like myself saw the price of a home skyrocket almost completely out of reach — to the point where a hard-working young roofer like myself can scarcely dream of purchasing even the dumpiest little shack in Denver without sacrificing literally half a lifetime of grueling labor (despite the fact that I, ironically, posses every single skill necessary to build my own home from foundation to rafters).

The lesson for me, as I perused my bank statements for the last few years, was that hard-working Americans in the private sector, like myself, can ill afford to take their increasingly worthless green paper for granted any more. We can no longer simply skimp and save in the naïve hope that we can live off a pile of emerald paper in the future, because the value of these pieces of paper continues to rapidly fall against the goods that we desire and which make our lives comfortable and happy. We need to take a cold, hard look at our un-backed currency and seriously consider exchanging these ridiculous green pieces of paper with which we are paid (and which the Fed continues to recklessly pump out at a record pace), for goods that retain their value over time. We need, in other words, to exchange our paper for the scarce and irreproducible goods that have been used as currencies since the dawn of civilization; namely, gold and silver.

As I thumbed through my bank statements with my left hand, sipping the low-quality, sour, American ale that cost me an hour's worth of grueling labor, (when only a few years ago the same amount of green paper would have bought me a fine micro-brewed lager), I felt unrelenting pricks at my pride for being the dupe of this ruse for so long. I felt irrepressible resentment and disgust toward the U.S. Treasury and the Federal Reserve for the depreciation of my and every other hard-working American's hard-earned wages and savings for their own selfish benefit (not to mention the nauseating level of taxation extracted from us by the U.S. Congress and their henchmen in the I.R.S.). These agents of the federal government were stealthily taking more and more of the money I was earning with the sweat of my brow and the strength of my tired and sunburned arms, while they sat back in their plush leather chairs in New York and Washington printing ever more green paper and arrogantly extracting more taxes from me.

Under my right hand, however, lay my new M1A and a small pile of 22-carat gold coins. I felt a measure of consolation from the fact that there were doubtless tens of thousands of similar Americans who were not fooled by this unconscionable decline in the value of our currency, who were also exchanging green paper for gold (what better deal has there ever been in the history of the world?), and who also felt the sting of this mendacious ruse on their pride. I also felt a measure of consolation from the knowledge that this completely un-backed, and thus intrinsically worthless and infinitely replicable, green paper could depreciate only so long before millions of other Americans catch on to the ruse, and revolt against the pitiless plundering of their wages and savings by the Federal Reserve, the U.S. Treasury, and the U.S. Congress. When that day of reckoning finally arrives, woe to those who have so mercilessly robbed us of the just fruits of our backbreaking labor for so very long.

June 27, 2007