• 0 Posts
  • 9 Comments
Joined 1 year ago
cake
Cake day: July 2nd, 2023

help-circle



  • But sure, keep thinking you understand the issue better than people who have studied everything about the issue and are actually paid for their knowledge.

    Actually, looking at the source, they openly disagree with you. Here is what they say:

    “We now have a credible prospect that inflation will return to 2% in 2025. The only piece that’s missing is the conviction that wage growth will adapt to that lower inflation”, the Dutch central bank governor said in an interview with Dutch TV program Buitenhof.

    They are saying inflation is going down, but wage growth may not be. In other words, they aren’t keeping interest rates high to combat inflation, they are doing so to combat wage growth and wage growth alone. The only person here who thinks wage growth and inflation move in lockstep is you.


  • If I might add, what do you think costs are?

    I am intentionally using a somewhat loose term; costs are uses of finite resources. This could be labor, or it could be a physical item, like the iron ore you say I think is retrieved by putting cash in a box. And I’ll pay you the same respect you’ve paid me by asking: do you think workers simply will iron ore into existence? Or make food, independent of the presence of fertile topsoil, water, and sunlight?

    Money doesn’t disappear, it goes into someone’s pocket eventually, either through wages or through corporate income.

    Yes, and the point is I want more of that money go into workers’ pockets through wages than into owner’s pockets through profits.

    If costs are going up it means that someone somewhere is getting richer, meaning he has more money to spend, meaning things get more expensive.

    You literally just said that money doesn’t disappear. Someone is getting richer either way. She’ll have more money to spend regardless of if she’s an owner or a worker.

    It is true that wage growth does generally cause inflation. That’s one reason you can live in the global south so cheaply. It’s also why workers are so bad off there. Another example is Europe compared to the US: prices are higher in Europe, but workers get paid more and are better off than workers in the US. The whole point is that when workers’ wages go up, they have a bigger portion of the total amount of money, and thus are better off. This inflation fearmongering is all a distraction from that.


  • Companies like profits, so they’ll keep raising prices as long as people keep paying them.

    This is of course true whether or not wages go up.

    If people don’t have money to spend on shit, they won’t, and thus the prices will have to go down or at worst stagnate.

    No, the prices don’t have to go down or stagnate. Products don’t become cheaper or easier to produce because there are fewer people who can buy them. In fact the opposite is true. Cost per unit is higher as total units produced goes down.

    keep thinking you understand the issue better than people who have studied everything about the issue and are actually paid for their knowledge.

    Oh, I do think they understand this, and they are paid, but not necessarily for their knowledge.


    1. Wage growth does not imply higher inflation. For one, employers don’t print money, so the money in circulation does not necessarily increase as you claim. For another, prices are not determined by money in circulation; they are determined by costs. Plenty of things get cheaper to create over time.
    2. The current spate of inflation has been driven primarily by corporate profits and supply chain issues.
    3. Even if wage growth were to cause inflation, it would still mean workers would be getting a bigger slice of the pie, and they would do better relative to owners.