Wood County reporter. [volume] (Grand Rapids [i.e. Wisconsin Rapids], Wis.) 1857-1923, 1876-07-20
Nominal and Real Wages.

BY nominal wages is meant the sum IN
money which the laborer receives from his
employer Tor the work of a day, {. week,
OF a month, as the case may be, or which
he receives for work when done by the
piece. The value of this money to him
depends upon the comforts, necessaries.
or Injuries that he can buy with it. He
works for money and is paid in money:
yet he expects speedily to spend the mon
ely for his own support, or that of his fam
lily, or that of both. His money-wages
are turned into the means of living, and
these means, consisting in the food he
buys, the clothes he purchases, the lodg-
ing Tor which he pays rent, and the fuel
that warns HMM short, in the things
which he consumes or uses-constitute
his real wages. The money received for
his work is simply the medium by which
he secures these comforts. If he earns
more money than he thus spends, what he
saves and perhaps put to interest is still a
medium of securing future comforts. His
saving has reference to future wants. lust
as his current expenditure refers topresent
wants. In both cases money is simply a
means to an end
Whether, then, the laborer receives high
or low wages in the real sense cannot be
determined by merely computing the
amount Of money paid TO him for the work
of day, a week, or month The pur-
chasing power of the money in his hands
is to him very material question. If we
suppose his nominal wages to be doubled,
and that the prices of the commodities that
he must buy for his own consumption and
that of his family are also doubled, then
the nominal increase of his wages would
be of no advantage to him. What he
gains by this increase he loses by CORE
spending increase of prices. His labor
has no increased purchasing power. So,
if his nominal wages were reduced one
half, and prices were to sink in the same
proportion, he would lose nothing bv the
change. What he lost by the decrease of
wages he would gain by the decrease of
prices, or the increase in the purchasing
power OF money.
We see at once that, in respect to the
wages question, the character of the
money in circulation among the people is
matter of the most vital importance to the
labOring class. If the money, owing to
its character and the great facility of in
creasing the supply, has an exceedingly
tiuctuating value, as expressed in prices,
which is always the case with irredeem-
able paper money, then no interest is
more seriously affected than that of those
who are the sellers of labor and have
nothing else to sell. The general fact, as
shown by the history of all such money is
that the prices Of commodities rise more
rapidly and fluctuate more violently than
wages or the nominal price of labor.
There is a tendency III wages to follow the
course of prices, yet they do not do so
with regularity. Hence, when prices os-
cillate sharply labor is always placed at
disadvantage. The labOrcr cannot wait to
take advantage Of these oscillations in
prices. He must sell his labor at once;
and then he must at once spend the largest
part, if not all, of his wages for his sup
port. His earnings must be turned into
the means of living.
Honest money; stable money; money
that by a natural law graduates
the supply to the demand; money that is
not only the product of labor, but whose
exchange value is based on and measured
by that labor; money that tends toward an
equilibrium between prices and wages
this is the kind of money that best serves
the interests of the laboring class When
they receive it they have a guaranty that
their nominal wages and real wages will
maintain due proportion to each other.
The experience of the world has long
since settled the question that money, in
order to possess these characteristics, must
consist of the precious metals. These
metals furnish the currency of value:
and, if a paper circulation be added there
to, as the means of economizing its power
and promoting the convenience of the
people, it must, at the option Of the hold
er, be convertible into a value currency,
or it will become itself the source of great
evils.
There is no class in the community
more interested than the laboring class in
getting rid of the system of irredeemable
paper money. Mostof them probably do not
understand the relations between this
money and the wages question. Yet, if
they did understand the facts as they re-
ally exist, and as they affect their inter
ests, not one of them would be found
among the inf1ationists or vote with any
party not thoroughly committed to the
policy of specie payment. Paper money
is curse to every man who works for
wages and needs to consume his wages in
current expenses.-Neao York Indepeud-
ent.
IT,