Hey, did you hear? Amazon just raised wages to $15 an hour — hooray! Capitalism’s finally working, right? Wrong. Does it prove capitalism has finally taken one small step — or that it can never take a giant leap?
Go back to 1964, the last year the Quarter Dollar was minted from 90% silver. The minimum wage was $1.25/hr. — or five Quarters.
Take five of those Quarters today (ones from 1964 or prior) and melt down the silver. By weight, at today’s spot price for silver, you have roughly $15 worth.
This shows us two things: 1) Capitalism as understood by Adam Smith depends on sound money. Capitalism and fiat money cannot survive. It also shows that the problem with the minimum wage is not the wage, but the money in which it is paid.
Instead of focusing on how much the world’s richest man pays his employees, you could focus on why you need $15 to buy today what $1.25 bought in 1964.
Capitalism is not perfect, but it works far better than all other alternatives… until it is destroyed by fiat money enabling corporate rent seekers at the expense of the people at the lowest rungs of the economic ladder.