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Greed in the New Gilded Age


Most every “rule” in economics is half-baked and this whole Vox article about why rising productivity hasn’t led to rising wages is an example of the problem. It notes:

This is not the way the economy is supposed to work. Paychecks are supposed to grow faster when productivity rises this fast and unemployment falls this low. That’s the basis of free market economics. It’s the theory that businesses will pay employees more when they produce more, and that they’re willing to pay higher wages when it’s harder to find employees.

Yeah, see, free market economics is trash. The rules don’t work because they assume their rules matter more than the unquenchable greed of employers. The only reason employers have ever paid workers more is because those workers organized into unions and forced them to do so. Sure, theoretically, employers might pay higher wages when it’s harder to find employees, but that’s a position of last resort. They’d far rather find any other solution and we already see that through the use of prison labor, as one example, or turning them into salaried workers and loading them with responsibilities with no extra money or engaging in wage theft or using franchising, outsourcing, permanent temps, subcontracting, etc. The problem with all these theories is that the entire point of capitalism is to force people to work for you for nothing, or as close to nothing as possible. This is the basis of the entire system. It’s not gravity. There are no natural laws in economics. It’s all human choices.

This is not to say anything particularly negative about the linked article, which lays out the problem as conventional wisdom about economics and politics sees it and then places it in the context of the recent strike wave:

But for working-class Americans, the economic theories for why they can’t get ahead are irrelevant. What matters is that today’s economy is forcing workers to go on strike to get a decent raise.

It does not go on to note that not all of these strikes are about wages–in both the recent Stop and Shop strike and the Los Angeles teachers strike, wages were not a big issue, though benefits were. But I don’t expect too much here. I just think it’s very much worth noting how so much of the conversation about economics is a bunch of words covering up the sheer greed at the heart of the system by creating rules that aren’t actually rules and theories that are repeatedly proven incorrect.

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