The Nixon Cut: Unpacking the Link Between Gold and Wages US wages have plummeted to 43% of national income, a level not seen since the Great Depression.
This trend has sparked debate about its causes, with some pointing to current economic policies or labor market dynamics, while others revive an older theory: that President Nixon's decision to break up with gold in 1971 is responsible for stagnant wages.
At first glance, this link seems tenuous. However, a closer examination reveals a more complex web of causality. The inflationary pressures of the 1960s and 1970s played a significant role in eroding purchasing power.