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Worker pay isn’t keeping up with inflation

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Re: Worker pay isn’t keeping up with inflation

#781

Post by xapata »

tootie wrote: post #514
throwawaycities wrote: post #262

Earlier quoted context omitted.

Glad this was the top comment. Wages have not kept up with cost of living for 50 years in the US. We need to stop pretending flat wages are some modern problem of inflation, and we need to stop pretending inflation is some problem caused by the pandemic.

Is it not a problem? Wages rose substantially in the years between WWII and the 1970s but isn't that the actual aberration?

Could be. It might be that the existence of a substantial middle class, rather than a long tail of poverty, was an anomaly. Of course, we could choose to redistribute wealth to create any shape of curve we desire.

Re: Worker pay isn’t keeping up with inflation

#782

Post by anshumankmr »

WalterBright wrote: post #750
redisman wrote: post #651

Earlier quoted context omitted.

I mean it’s just not something most people find appealing. Shifting gears. I’d rather have the car handle that. What is the pro of manual transmission? I used to have those cars in the EU and thought it was just an annoying extra thing I have to pay attention to when driving.

> What is the pro of manual transmission? 1. enjoyment 2. keeps you awake 3. more reliable 4. more control in stuck or slippery conditions 5. thieves don't know how to drive them 6. the kids are terrified of it and won't ask to borrow it 7. can push start the car 8. can restart the car while moving if the engine stalls 9. can coast 10. can drop the clutch and get off the line faster when drag racing against some teen…

The main thing is that manufacturing it is cheaper than automatic and thus the cost to buy it is cheaper. In a longer term, it will also save money on repairs being neeeded.

Re: Worker pay isn’t keeping up with inflation

#783

Post by Shuang1 »

NoGravitas wrote: post #757
whimsicalism wrote: post #542

Earlier quoted context omitted.

Oh come on. People were literally starving in the US in the 60s-70s. Not really something that is easy to happen nowadays, even if it is difficult to get a balanced diet.

One in 9 people in the US suffers from food insecurity (not having regular access to adequate meals). During the height of the disruptions from the pandemic last year, one in 4 households experienced food insecurity. Sources: https://sail.gmu.edu/program/hunger-banquet-2021/hunger https://www.npr.org/2020/09/27/912486921/food-insecurity-in-...

Why are you bringing up "food insecurity" rather than deaths by starvation which is an objective measure of food shortness, and what the person you replied to is talking about?

How many people starve to death in the United States?

Re: Worker pay isn’t keeping up with inflation

#784

Post by cherrycherry98 »

what_is_orcas wrote: post #729
cherrycherry98 wrote: post #718

Earlier quoted context omitted.

This is nothing but a platitude that attempts to shame businesses for not meeting some idealistic vision of how the world ought to be. There's no hard rules about what wages should or should not be, as with any other market price. A business will pay however much they need to attract and keep the labor they need. If no one wants to work for them they need to increase the wages they offer, which may in turn result in…

> some idealistic vision of how the world ought to be Yeah, I think it's a tragedy that we have constructed a society where everyone doesn't have basic needs met. I think it's a bigger tragedy that the alternative to the current system is considered idealistic . You don't have to agree with me, but if nobody talks about the ways that things could be, not the way that they are, then things will never change. I'm not s…

My objection to the parent post is the notion that a business which can't pay a living wage shouldn't be in business. It insinuates that businesses should be responsible for paying a living wage out of some sense of it being morally right, which is ignorant of how economics operates. Wanting people to be able to meet basic needs and have some financial security is, I believe, universally desirable. Please do think that I don't want this as well. To expect it to come via altruism is idealistic.

> Are you suggesting that minimum wages are bad because it sets a minimum for employers to pay as though without a minimum wage they would pay a rate more in line with value?

Yes, that's basically what I'm saying. Most literature focuses on people being priced out of the labor market (see https://www.cato.org/policy-analysis/negative-effects-minimu..., for one such analysis).

I'm also suggesting there could be other effects due to loss of agency over one's labor price, similar to how collusion of employers to fix wages harms employees. Maybe someone has studied it, maybe not.

>If folks earning a minimum wage today, in a world with a minimum wage, can't afford basic living expenses, would you expect more people to afford basic living expenses without a minimum wage?

Ultimately prices are fluid based on what people can afford, especially so for local markets like housing. If minimum wages increase one would expect increased housing prices as those prices were set in line with what people could afford. If they make more, now they can afford to pay more. If you were making marginally above minimum wage you now also want an increase to protect your increased buying power.

W.E. Upjohn Institute for Employment Research found that modest minimum wage increases have minimal affect on prices increases while larger ones can create price increases. This makes intuitive sense, based on market theory. https://research.upjohn.org/cgi/viewcontent.cgi?referer=&htt...

Re: Worker pay isn’t keeping up with inflation

#785

Post by Sohcahtoa82 »

xapata wrote: post #777
vmception wrote: post #774

Earlier quoted context omitted.

Regardless, landlords set the price. They always had the opportunity to post ridiculous prices, and they bring them to the price people accept. They dont have to go to the edge of what someone would accept. But they do. The same tech worker (or whoever a local municipality happens to be pointing fingers at) would pay $1200/mo in one area, or $7500/mo in the other area. A wealthy class of people have always existed th…

Landlords are price takers, not price makers. The market for apartments is highly competitive.

If that was true, apartment pricing would be flat or even trending down, as landlords would compete on price.

But they don't. Instead, landlords fight against the construction against additional housing so they can limit supply and increase prices.

I had a 900 sq foot, 2br, 1 bath apartment in the suburbs in 2012 that was $800/month. Each annual lease renewal was a higher price. When I moved out in 2015, the price was $950 at the time. If I had renewed, it would have been $1,100/month. That apartment now is $1,500/month. In less than 10 years, that apartment has doubled in cost.

Rising prices do not indicate a competitive market.

Re: Worker pay isn’t keeping up with inflation

#786

Post by mwigdahl »

treis wrote: post #652
mwigdahl wrote: post #557

Earlier quoted context omitted.

Sure, but the same inflation that was driving up mortgage rates was also reducing the real value of the balance of the loan. You can't just look at rates here.

We're talking about affordability here. And my point is that to determine if something is affordable you have to look at monthly payment and not the purchase price.

OK, sure. But inflation has an effect on the monthly payment as well. Assuming stagnant real wages (pay raises pace inflation exactly) if inflation is at 7% but you're paying 10% interest, by the end of a 30-year loan your fixed payment is effectively 8x smaller in real terms than it was at the start of the loan.

In other words, in that environment it was feasible to stretch to buy a home even at a high interest rate, because you knew that every year your fixed payment would decrease significantly as a share of your income.

Re: Worker pay isn’t keeping up with inflation

#787

Post by WalterBright »

anshumankmr wrote: post #782
WalterBright wrote: post #750

Earlier quoted context omitted.

> What is the pro of manual transmission? 1. enjoyment 2. keeps you awake 3. more reliable 4. more control in stuck or slippery conditions 5. thieves don't know how to drive them 6. the kids are terrified of it and won't ask to borrow it 7. can push start the car 8. can restart the car while moving if the engine stalls 9. can coast 10. can drop the clutch and get off the line faster when drag racing against some teen…

The main thing is that manufacturing it is cheaper than automatic and thus the cost to buy it is cheaper. In a longer term, it will also save money on repairs being neeeded.

I've paid more to get a stick :-)

Re: Worker pay isn’t keeping up with inflation

#788

Post by krapp »

nradov wrote: post #775
dasil003 wrote: post #719

Earlier quoted context omitted.

> When the US Constitution was written there was hardly even an industry; most firearms were craft built. You mean at the dawn of the industrial revolution, before which, you know, everything was craft built?

Yes that's what I mean.

We live in the 21st century, not the 18th century. If liberty requires that access to guns be a universal and inalienable right, then the capacity to manufacture and provide guns must scale with the population, and a small arms manufacturing infrastructure is necessary now to supply 300 million Americans with the access to firearms that the Constitution deems necessary for the US to remain a free state. Otherwise liberty diminishes because fewer guns wind up in fewer hands.

The Second Amendment does very much depend on the existence that industry, because if the government were to allow small arms manufacturing to fail, it would be de facto abridging the people's right to keep and bear arms. It's the only industry that has to exist in the US, by fiat.

Re: Worker pay isn’t keeping up with inflation

#789

Post by avgcorrection »

WalterBright wrote: post #764
avgcorrection wrote: post #433

Earlier quoted context omitted.

One answer? Or an answer that happened to fit the predetermined conclusion “government’s fault”? More of the share of productivity has gone to the owners and CEOs compared to the workers over the last 40 years. That’s the fact base that we are working from. Your supposed answer fits like a square in a round hole.

Where do you think all the trillions the government spends comes from? You could give all the CEO pay to the workers and it won't make any difference, except you won't have a competent CEO anymore. Any worker can become an owner by buying stock.

> Any worker can become an owner by buying stock.

That’s some real “just stop being poor” advice.

Re: Worker pay isn’t keeping up with inflation

#790

Post by nobody9999 »

whimsicalism wrote: post #663
nobody9999 wrote: post #595

Earlier quoted context omitted.

>So.. how does that imply that people are worse off now than in 1970? Your entire thesis seems to be that the jealousy people will feel from seeing others have things they don't will outweigh all of the material gains of the last half century. As an American, I don't subscribe to that thesis. At all. What I do see (as someone in his mid 50s) is that the biggest difference is that folks back then believed (and it actu…

? I absolutely agree with you. Inequality nowadays is quite bad, overall welfare could be much better if we weren't hamstrung by it. But I don't see how this means I'm ideologically committed to the absurd thesis that we haven't seen quality of life improvements for the average person in the last half century - going from a time where we had only recently eliminated actual starvation in the US, schools were still bas…

>But I don't see how this means I'm ideologically committed to the absurd thesis that we haven't seen quality of life improvements for the average person in the last half century - going from a time where we had only recently eliminated actual starvation in the US, schools were still basically segregated, inflation rampant, a draft, etc. etc.

I don't believe my comment even implied that.

Rather, I was providing my own take on your assessment of markvdb's comment[0], which I don't disagree with, I just wanted to address the elephant in the room (the systemic changes pulling more wealth/income to the top at the expense of those at the bottom) that hadn't been addressed.

That's not to say you didn't make a good point. You did. But I felt there was more to say.

[0] https://news.ycombinator.com/item?id=29592162

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