Is there any way the US dollar can again be worth what it was 50 years ago?

Question

I've read questions on here about putting the dollar back on the gold standard, and it sounds like it couldn't work because of the limited amount of gold. But is there any way the dollar can again buy what it did 50 or even 40 years ago?

This may or may not be the same issue, but I remember late radio talk show host Bob Lassiter when I was in high school (about 20 years ago) saying that when he was growing up his dad paid the mortgage on their house working for the minimum wage at that time. He went on to say how badly the minimum wage has fallen behind the cost of living since then. Can you imagine how much less poverty there would be today if people earning the minimum wage could afford a house? Is there any way to get it back to that way, if that's the way it was at one time?

I'm not sure exactly if this should be 2 separate questions or not, sorry.

Answer 1

The min. wage should not even exist.  I think people should make what they are worth.  If you have no or limited skills, you should obtain some and make a living.  Too many people "settle" on min. wage jobs.  Of course, not everyone can or wants to earn a college degree.  That's fine.  But,  realize that, though there are many causes of unemployment (structural and frictional being the ones I remember of the top of my head) min. wage is easily a cause of unemployment.  I think that if there were no min. wage, people that deserve to make $7.00 (whatever the min. wage happens to be) would live better lives.  My assumption of this sort is based on lowering cost for employees would lead to lowering price of goods.  For instance, if the average McDonald employee made $5.00 instead of $7.00, a large fry might cost $1.20 instead.  Of course, this assumption is probably NOT true because the supply and demand for fries determine the price of fries, but you can imagine that costs causes firms to lower prices.  At least in theory.  A lower or non existent min. wage would raise living standards in my opinion.

Answer 2

No way! Things don't get cheaper.... This world we live in is a consumerist, shallow society and the economists know it.

Try buying property in Australia..... It is so expensive here now. No wonder our economy has almost caught up to yours...

Our parents had it really easy. they even had free university education! For us it's SO hard. It's so not fair!

That's my whinge for the day :-)

Answer 3

Inflation is not the problem.  If prices and wages both double there is no change in the standard of living. What has happened over the last 30 years is that quality of life affordable to the top 20% of income earners has increased dramaticly while the wages of most people  have barely kept up  with the cost of living. To keep up with the bigger houses and amenities as well as the rapidly increasing share of the budget consumed by college cost and the improved health care average families now need two incomes.

Answer 4

There definitely has been an increasing gap between rich and poor.  I guess some economists would argue that "a rising tide lifts all boats".  In other words, even if the economy is growing disproportionately, it is still growing, therefore all people are still better off than they once were, ie: advances in technology, health sciences, etc.

They corrolation here with Lassiter might be that although his father was able to pay a mortgage on min. wage, he WASN'T able to send in a prescription order to his doctor on his cell phone.  Is that worth it?  Thats your call.

The dollar is slowly correcting the enormous trade deficit we have right now (in theory).  We are able to buy less foreign goods with a weakened dollar and therefore must buy our own goods.  At the same time, since our dollar is weak, foreign countries are more likely to buy our goods because it is cheaper for them now that the dollar's value has dropped.  These two factors should contribute to us balancing our trade debt.  Although there are a million other factors that come in to play, this is just a broad summation of the issue.

Hope that makes sense.

Answer 5

The answer is they are bringing the worth of the doller down to allow the new currancy Amero to be avilable to South America. If it were worth more it would not work out. Welcome to the NAFTA sticking it to you. It was minted in Denver last month.