Please Stop Putting Very Old Things in "Today's Dollars"
Instead, do this
(I’m Henry Snow, and you’re reading Another Way.)
The desire is understandable: some historian tells you someone was paid 1 shilling a day, or that a ship was loaded with 1,000 pieces of eight, and you wonder how much that would be worth today. Frequently, historians try to answer this immediately– “John Smith was paid 50 pounds for his troubles, worth over $10,000 today.” There’s a place for this across short timespans within the same country— 2005 in America and 2025 in America, or even 1975 and 2025. But the longer we go, the worse it gets. Across centuries? Don’t bother. It’s unhelpful and misleading
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The Bank of England has a helpful inflation calculator on its website. Arbitrarily choosing some old British Royal Dockyard pay books data I happen to have: George Bastard, a shipwright at Portsmouth, made a little over £37.5 in July-September 1805. Not bad! The BoE’s calculator would have you believe this is equivalent to an annualized salary of around 11,000 pounds. And Bastard made higher wages than others, probably due to seniority and his work with the Timber Master. If we go further down the shipwright listings and take even the much lower pay of one Algernon Jones, who made just above 22 pounds that same quarter, we end up with £6,581 annualized.
Before actually analyzing these numbers, let’s talk about where they come from. Calculating inflation today, central banks look at price changes in an imaginary “basket of goods”-- a sort of average household budget. A quick look through the BoE’s website indicates that 1805 statistics come from a price index put together by Phelps-Brown and Hopkins several decades ago. It works on similar principles, drawing from market, college, hospital, and military records on consumables. There are serious issues with any such dataset, but for today’s purposes let’s assume the data’s all good. This approach gives us a comparison based on goods like meat and bread: if George Bastard took his thirty quid to 19th-century Tesco (a sort of convenience store, for my American audience), here’s what he could buy.
Unfortunately this does not tell you much about a person’s life, on its own. Very little about 19th-century shipbuilding life generalizes to 21st-century consumer terms. Bastard and Jones, to begin with, probably ate significantly more than you do, especially in the winter. Rations for US sailors in the war of 1812 provided over 4,000 calories. Shipwrights worked in rather similar conditions (certainly in Portsmouth, which is right by the coast), and often did even more demanding work.
So on consumables alone, we might have to adjust our estimates: just to feed themselves, let alone their families, these men needed more food than most of us. You can absolutely take this into account in price indices (you adjust the imaginary basket’s size), and we try to, but that creates its own interpretation issues. If you want to look at any specific good– if you take Bastard’s imagined 21st-century salary and compare it to your grocery bill– you won’t get the right picture.
Food is just the beginning of our problems. What about housing? Data on this is not great, but as a percentage of their total income, 18th and early 19th-century workers did not generally pay the kinds of exorbitant rents or mortgages that we do in the US today.
And plenty of people had housing and labor arrangements that were dissimilar to ours. Apprenticeships combined education, food, housing, and labor. Masters (usually) covered lodgings and food in exchange for apprentices’ labor and a fee.Shipwrights like Jones and Bastard would have come through this system, though they might have learned from their fathers, in which case fees would not be involved. In Portsmouth there would be various opportunities to learn from family friends, possibly lodge with them or family…
The way workers were paid was different in 1805 as well. In addition to their formal wages, shipwrights took waste wood, known as “chips,” out of the dockyard. This was material produced in the course of cutting timber– if you cut a round timber into square components, you get waste wood– and dockyard workers had long considered taking it a customary right. Chips were a compensation mechanism, in effect, that was under the control of workers as well as their bosses (here I’m drawing not only from my own forthcoming work on the subject, but Peter Linebaugh’s excellent chapter “Ships and Chips” in his book The London Hanged). In dire times, workers could cut timber more wastefully to take extra chips, or hide expensive iron dockyard goods in their bundles and sell those as well. They meant freedom and security for workers, and corruption and laziness for dockyard administrators. Over a century of attempts to ban the practice had failed.
You cannot only understand dockyard pay as a monetary wage, because workers were not only paid in wages. And this is a relatively modern era and place– if we go elsewhere or further back we would of course find people who were not paid at all, or were paid even more differently from anything familiar to us. Once again, simple numbers fail us.
One more problem before we talk about solutions: the cost of services. Today much of our income is taken up by services, from food delivery to healthcare. In the past, workers like Bastard used a different array of services: less healthcare, no food delivery. They also relied more on domestic labor: apprentices were often used to do free domestic work like dishwashing and cleaning, and even wealthier artisans might have enough money to pay a servant to do these.
The price of labor goes up over time– in absolute terms– as productivity rises. If the car factory gets 10% more efficient, it costs other employers more money to pay you not to be working there. Economists have a term for the resulting rise in service costs: Baumol’s cost disease. This is a scary term, but it’s a good thing! The better we get at doing things, the more we all benefit… as workers. As consumers, on the other hand, we can suffer.
In short: the entire economy looks completely different after 223 years. The type of goods people buy, the percentage of their income that familiar goods take up, their relationship with goods and services, everything. I’ve done the annoying historian thing where I make everything complicated– is there a way out of this? Yes!
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If you want to understand George Bastard and Algernon Jones’s economic life, you need two things. The first is their social world. George Bastard and Algernon Jones lived in a relatively well-documented place, in early 19th century terms. Eighteenth-century shipwrights wrote long and heart-rending petitions to the Navy Board asking for help with this or that, mentioning “large families” and hunger. Rents were often months late– which helped keep shipwrights in line. This artificially reduced pay, because workers had to rely in the meantime on what we might now call loan sharks.
The statistics I gave you for Bastard and Jones come from a particularly fraught period in dockyard history. In the late 1790s, anonymous shipwrights terrified the government with ominous warnings of riots, and publicly posted rhymes threatening to hang bakers if prices did not come down. In spring 1801, dockyard workers facing wartime inflation threatened to go on strike and demanded wage increases. The new head of the Admiralty Board, a vicious officer named John Jervis (the Earl of St. Vincent) brutally crushed the strike, with the help of mechanizing Inspector General of Naval Works Samuel Bentham. A few years of firings, regulations, and terror later, and the naval administration finally shut down chips.
These are just some of the things I might want you to know about George Bastard, if you wanted to understand his economy and his world.
The second thing you can use to understand Bastard and Jones’s budgets is details specific to their time. Even now and especially in the less-connected past, economies are local. The fact that America has many vacant homes doesn’t help me, because I want to live near my family and job, not in an abandoned 2-bedroom in Idaho. Maple syrup is affordable in my beloved New England, but not so much elsewhere.
Economies are local in time too. Ski gear is cheaper in the summer (you need a coat, get on that, dear readers), but that doesn’t help you if it’s November and your coat wears out. Loans and savings help us stretch into the past and future with our money, but they come at a cost, and they only stretch so far. Historians are cautious about making oversimplified comparisons across space for good reason– any detail can be misleading. We still make mistakes! One book I’m currently reading, by a historian who has worked in the Spanish world, keeps using “the Crown” for 18th-century Britain in ways that would be accurate for Spain, but subtly overstates the power of the monarchy in Britain. We should be even more careful jumping across time. British and Spanish subjects could exchange money and words back and forth. Time only goes one way.
So use details from the appropriate time! I can’t tell you how much money George Bastard would have for DoorDash, but I can tell you that Portsmouth shipwrights saw grain prices whipsaw back and forth in his day. Different places offer different data, but you can find local food prices, examine tax records, find businesses in the area. Historians who are tempted to give a quick “about X in today’s dollars” should instead give us some local color. How much did bread cost in the area? Or beer? What could you buy then with this kind of money?
Money seems to offer objectivity, much-needed concrete reality in our otherwise murky understanding of the past. Historians are always hedging and qualifying. Economic history might seem to offer more solid and concrete answers, but in reality it is useful only insofar as we also engage with social, cultural, and political history. Economic comparisons across long timespans— even centuries— have their place. But understanding the welfare of individuals is not something we can do this way.