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Time Traveller's Cheques, and Why Is Labor So Expensive?
Over on rasfw, David Tate started the thread "Time Travelers strictly barter", on what would be good for a time traveller to carry with them to get by in their destination. He was particularly interested in things besides the old standbys, silver and gold, things such as spices, synthetic gems, pins, lodestones. But the topic hit upon a couple of past interests of mine: prices in medieval Europe (for the Ars Magica game), and why and how there's such a huge wage differential between the First and Third Worlds.
A day laborer's wages used to be a silver penny, 1.55 grams, which at the time would have been about 2 ounces of gold for a year's work. (Maybe less, considering Sundays and holidays; I've been multiplying by 365.) Today, 2 ounces of gold is $1200, though it's been as low as $600. In the US that's nothing (for a year)... but much of the undeveloped world is said to live on less than $2 a day, and has GDP/capita comparable to $1200, or even $600. So, the gold price of hiring an illiterate laborer who lives in a shack and doesn't eat meat often hasn't really changed much. (In Cuba, you can get a literate laborer who has health care, but never mind.) Silver has dropped a lot in price, though: it used to trade 10:1 to 14:1 with gold, now it's 60:1. The silver penny today is 55 cents, but at the old ratio it'd be $2-$3.
Even in the US, the $1200 will go fairly far if you drastically lower your expectations: the cost of flour is 40 cents a pound, dry beans about $1/pound, even organic grains are 80 cents a pound. So it seems like it'd be possible to feed a family on $3/day, on grains and beans, hopefully squeezing in some carrots and cabbage for vitamins. (There's the cost of fuel for cooking, but at least with gas that doesn't seem high.) Fortunately spices are much cheaper relative to gold than they used to be, so while this is living like a peasant, it could easily be living like an Indian peasant, which is at least tastier. Salt's cheap too.
But a minimum wage laborer gets about $10,000. Where's it all going? Better food and lots of it: heavily processed grains, lots of meat (consuming even vaster quantities of grain), fruit and vegetables from far away when we want them. Housing: we have bigger and more substantial houses, not to mention urban land costs. Solid walls and roofs, glass windows, lots of running water, electrical wiring, lots of space -- archeologists describe ancient houses which sound more like rooms to me. The electricity that goes through the wiring and provides light at night and A/C in the summer. Gas or electricity for the winter. And non-housing: Multiple changes of clothes and shoes. Car. Furniture. Not to mention all the neat toys, phone, TV, cable, computer, music on demand. Medicine which actually works. Vast quantities of books. Not to mention taxes, paying for paved roads, sewage systems, schools, and helping out the old and infirm.
Machines make lots of things cheaper in the sense of needing fewer people, but the people still involved also get this lifestyle, so they cost more. Except in produce-picking and clothing manufacture, where labor outside this bounty is used -- seems that whenever the world is fully developed, we're going to need better machines or have to deal with a lot more expensive clothing and lettuce. So at least part of our lifestyle is cheating, like feudal lords, exploiting the labor of those outside the system to live in a way we couldn't manage ourselves.
I'm not sure what my final points are. It's just intriguing that the gold price of a particular type of labor hasn't changed, and then to think about why even the bottom (legal, domestic) rung of US labor is much more expensive than that, and what they're getting for that expense, and what the cheap labor making our clothing *isn't* getting.
A day laborer's wages used to be a silver penny, 1.55 grams, which at the time would have been about 2 ounces of gold for a year's work. (Maybe less, considering Sundays and holidays; I've been multiplying by 365.) Today, 2 ounces of gold is $1200, though it's been as low as $600. In the US that's nothing (for a year)... but much of the undeveloped world is said to live on less than $2 a day, and has GDP/capita comparable to $1200, or even $600. So, the gold price of hiring an illiterate laborer who lives in a shack and doesn't eat meat often hasn't really changed much. (In Cuba, you can get a literate laborer who has health care, but never mind.) Silver has dropped a lot in price, though: it used to trade 10:1 to 14:1 with gold, now it's 60:1. The silver penny today is 55 cents, but at the old ratio it'd be $2-$3.
Even in the US, the $1200 will go fairly far if you drastically lower your expectations: the cost of flour is 40 cents a pound, dry beans about $1/pound, even organic grains are 80 cents a pound. So it seems like it'd be possible to feed a family on $3/day, on grains and beans, hopefully squeezing in some carrots and cabbage for vitamins. (There's the cost of fuel for cooking, but at least with gas that doesn't seem high.) Fortunately spices are much cheaper relative to gold than they used to be, so while this is living like a peasant, it could easily be living like an Indian peasant, which is at least tastier. Salt's cheap too.
But a minimum wage laborer gets about $10,000. Where's it all going? Better food and lots of it: heavily processed grains, lots of meat (consuming even vaster quantities of grain), fruit and vegetables from far away when we want them. Housing: we have bigger and more substantial houses, not to mention urban land costs. Solid walls and roofs, glass windows, lots of running water, electrical wiring, lots of space -- archeologists describe ancient houses which sound more like rooms to me. The electricity that goes through the wiring and provides light at night and A/C in the summer. Gas or electricity for the winter. And non-housing: Multiple changes of clothes and shoes. Car. Furniture. Not to mention all the neat toys, phone, TV, cable, computer, music on demand. Medicine which actually works. Vast quantities of books. Not to mention taxes, paying for paved roads, sewage systems, schools, and helping out the old and infirm.
Machines make lots of things cheaper in the sense of needing fewer people, but the people still involved also get this lifestyle, so they cost more. Except in produce-picking and clothing manufacture, where labor outside this bounty is used -- seems that whenever the world is fully developed, we're going to need better machines or have to deal with a lot more expensive clothing and lettuce. So at least part of our lifestyle is cheating, like feudal lords, exploiting the labor of those outside the system to live in a way we couldn't manage ourselves.
I'm not sure what my final points are. It's just intriguing that the gold price of a particular type of labor hasn't changed, and then to think about why even the bottom (legal, domestic) rung of US labor is much more expensive than that, and what they're getting for that expense, and what the cheap labor making our clothing *isn't* getting.