The promise of progress was never kept.
Assembly line manufacturing, incredible progress in technology and computing, better chemicals for food production and advances in everything from information gathering to energy exploration was all supposed to improve our lives, enable us to work less and spend more time at the beach or with our children.
We got all those improvements in technology and we have surpassed, even our wildest expectations on how to get things done, yet instead of working less and having more leisure time, we now have to work more, work longer, and the quality of life has deteriorated for more Americans then ever before.
“Real income” (what you can buy with your dollars) has actually decreased over the decades where now the average working man is making less then he was 40 years ago.
The advancements were made, and we now make things cheaper and in more quantities then ever before, yet the average Joe has less.
Where are the rewards we were promised for such progress?
The promise was stolen, plain and simple. Stolen by an economic reality repeatedly foretold and reiterated in almost every economic text book in existence.
The reality is called monetary inflation, and it is brought about solely by any and all institutions that control the money supply of a population.
Put simply, create more currency (in our case U.S. dollars), and the prices of everything within the borders of that currency rise (inflation).
Most people know what inflation is but don’t understand the reality of how it works, and the reality is this:
Inflation affects everything priced in the currency, so the prices of everything rise wherever that currency is used. The caveat is wages never increase as fast or in proportion to the increase in all the other prices around it.
In other words, as prices rise around you (including your wages) you perceive you are keeping up, but in reality, wages never increase at the rate everything else does. It’s like running a race with a car. The longer you run the race, the farther behind you get.
Because most people don’t understand this fact, they have no idea that every day there is inflation, you fall further behind. Those creating the currency don’t want this simple truth exposed for it would put a halt to the policy.
In fact, the Federal Reserve plainly states it targets an inflation rate north of 2 percent and does everything in its power to achieve that rate.
But the reality remains.
A reality that made Henry Ford utter these words: “It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”
This article expresses the opinions of Marc Cuniberti. He hosts “Money Matters” on KVMR FM 89.5 and 105.1 FM on Thursdays at noon. His website is www.moneymanagementradio.com.