Disclaimer: Statistics here are not all verified, but we suspect they are substantially correct (close enough for illustration.) And better, more accurate sources/data are welcome.
1912
The picture above has stats from 1912, the year before Woodrow Wilson caved in to pressure(s) to approve a wholly different kind of monetary policy, central banking (Federal Reserve) - a decision from which he repented in word, but failed to undo, when he realized what he had done.
"I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated Governments in the civilized world no longer a Government by free opinion, no longer a Government by conviction and the vote of the majority, but a Government by the opinion and duress of a small group of dominant men."
~Woodrow Wilson
1956
Here's one for 1956, pretty well centered between 1912 and now.
Note that yearly income is about quadrupled from 1912 and buying a house went up about 10 times. If those numbers are truly representative of averages, then the relative cost of owning your own home went up by a factor of around 2.5 from 1912 to 1956.
To be fair, lots of other changes happened during that time. Housing standards and expectations changed. Lots of other things changed, too. So it's not a fair, direct comparison. Still, it's food for thought and cause for further research ... if you're so inclined.
1971
This is the year Nixon took U.S. currency all the way off the gold standard.
Source: http://www.thepeoplehistory.com/1971.html
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Do the math.
As I understand it, the problem with fiat money, as this post this demonstrates, is the govt printing money to pay off debt and causing inflation in the process.
ReplyDeleteInflation screws people in a number of ways. Savers and fixed income folks see their buying power swept away through no fault of their own. The government doesn't adjust for inflation before applying capital gain taxes - even though they (the govt) caused the inflation via its fiat currency.
So, inflation is really a sort of regressive, flat tax on everyone.
That's *one* of the problems with fiat money...the other being that all governments that dabbled with it, historically speaking, have always crashed and burned.
ReplyDeleteIt is also interesting to note that the income tax was instituted very shortly after the Federal Reserve came to power. As the value of the dollar was diminished, people earned more of them, thereby being caught up in the federal tax code. (Originally, something less than 5% of wage earners were required to pay income taxes.)
WE have thus been subject to taxes that are not merely regressive, but actually confiscatory, in my view.