Tuesday, November 29, 2016

The Minimum Wage is our Cross of Gold

Coming to terms with $7.25

William Jennings Bryan. 

My grandpa, who is in his 90's describes himself as a "William Jennings Bryan Democrat." I think he's voted Republican in pretty much every election for the last 50 years, but that changes nothing.

According to Wikipedia
William Jennings Bryan (March 19, 1860 – July 26, 1925) was an American orator and politician from Nebraska, and a dominant force in the populist wing of the Democratic Party, standing three times as the Party's nominee for President of the United States (1896, 1900, and 1908). He served two terms as a member of the United States House of Representatives from Nebraska and was United States Secretary of State under President Woodrow Wilson (1913–1915). He resigned because of his pacifist position on World War I. Bryan was a devout Presbyterian, a strong advocate of popular democracy, and an enemy of the banks and the gold standard. He demanded "Free Silver" because he believed it undermined the evil "Money Power" and put more cash in the hands of the common people. He was a peace advocate, a supporter of Prohibition, and an opponent of Darwinism on religious and humanitarian grounds. With his deep, commanding voice and wide travels, he was perhaps the best-known orator and lecturer of the era. Because of his faith in the wisdom of the common people, he was called "The Great Commoner."
In case you can't tell, the vast majority of these positions are irrelevant. Prohibition was tried and failed. Arguments over whether or not the US should be a part of WWI are purely academic. Evolution, especially the arguments he had with it, probably still hold some sway, but it is, just like prohibition and WWI, pretty settled and to the extent they are not, Bryan's position would find more adherents in the Republican party than the Democratic party.

Still, he was a Nebraskan and those of us who are from Nebraska, including my grandpa, are pretty proud of the influence he had.

His Role in Rhetoric.

Any account that you read of William Jennings Bryan seems to emphasize his skill as an orator, a practitioner of spoken, public rhetoric. American Rhetoric consistently ranks puts Bryan's "Against Imperialism" in the top 100 American Speeches of the 20th century (barely making it in, having been delivered in 1900). Because of this profound skill, Bryan has been especially studied in my field, Communication Studies, especially in rhetorical studies. If this were an academic article, I'd put a lit review here. I also wouldn't write "I'd" or "wouldn't."

On of his heavily studied speeches is his famous Cross of Gold speech delivered at the Democratic National Convention in Chicago on July 9, 1896. In this speech he advocated for "Free coinage of silver" in order to remove money from the moneyed class and allow it to distribute more freely among common people.

He was wrong. 

I probably won't tell my grandpa, but William Jennings Bryan was wrong. The US did eventually abandon the gold standard, first by making it illegal to exchange money for gold at banks during the depression. Then, in 1971 Nixon abandoned the gold standard entirely, saying money would no longer be backed by gold. In 1974 Ford signed legislation which made it so Americans could own as much gold as they wanted, making it a thing that could be traded like a commodity which would rise and fall how it could be exchanged for money.

There is still a "moneyed class" however. 

Maybe you haven't noticed, but there are still rich people and they still have a pernicious influence over poor people. The reason for this is that even though gold is no longer the standard, people with money are able to make exchanges that favor them. 

FDR's New Standard-- The Federal Minimum Wage

People say now that we have a "fiat currency." That is, a currency backed only our trust in our government. Sometimes people will say "just print money" to cover our debts. Others argue against this because it would devalue our currency because people wouldn't trust the government not to just do it again.

But no one really trusts the government. 

The same president who banned exchanging money for gold, however, actually, and rather covertly created a new standard. President Roosevelt created a federally mandated minimum wage. You could no longer be guaranteed to get gold for your money as a flat rate of exchange. Instead, the money is backed by a certain amount of unskilled labor; 25¢ could buy one hour of an unskilled American's labor. 

Skilled labor, yes, is worth more, just as finely wrought golden jewelry is worth more than the base value of the gold which was held at $35 an ounce during the years between FDR and Nixon where there was some pretense of a gold standard, although one couldn't do an exchange of money for gold anymore. A medical doctor might make much more, but even a medical doctor, when reduced by extreme circumstance or a sudden loss of skill could get the minimum wage for his labor.

William Jennings Bryan's argument, while still popular, is still not going to address income inequality.

You've got folks today calling for a minimum wage that is more than double what it is today. They think, just as he thought, that this will put more money in the hands of the common person. It won't. It will just mean that the money is worth less, not just because of services increasing their costs to save themselves, but because what the money is backed by really costs more.

No comments:

Post a Comment