Comment by PaulHoule
4 hours ago
It's an interesting question.
We have a group that promotes a "living wage" construct in Tompkins County that pushes the unquestioned assumption that people who are working in the lowest paying jobs can live 100% alone. It's not something I want to challenge directly, but... It reminds me of discussions about the minimum wage in the late 1980s when it was common for teenagers to work at supermarkets and fast food markets. I think the public never really understood how the
https://en.wikipedia.org/wiki/Earned_income_tax_credit
was specifically intended to help out people who were raising a family with low incomes that was economically efficient and how there is some logic to people who are working in low income jobs qualifying for food stamps, it is not just a way "Wal-Mart is stealing for us."
e.g. part of "affordability" is keeping costs low and as much leftie folks want to sweep it under the rug there is a lot of internal class conflict in groups such as women: like the Sheryl Sandberg type definitely benefits from exploiting less wealthy women to do child care work for them and child care is basically problematic because the child care worker is not productive enough to put their own children in child care without subsidy and you don't get the Fordist scenario where the auto line worker can easily afford to own one of the cars they make.
I can't think of any serious leftist who would advocate for high costs, unless there was some fundamental resource constraint like with fossil fuels.
Well high wage implies a cost that has to be pushed on somewhere. It's not crazy to fear that raising wages, sometimes, can cause costs to go up, which can lead to more demand for higher wages. It may really depend on how much slack there is in the system.
What does improve material standard of living is increases in productivity, but the scope for those is limited, see
https://en.wikipedia.org/wiki/Baumol_effect
Like the basic story of the past 150 or so years is that agriculture has gotten dramatically more productive so people can do other things and move into cities with all sorts of implications.
High wages raise purchasing power as much as they raise costs, so aren't exactly raising costs overall. In fact prices should be measured relative to wages. Non-wage costs (i.e. profit and rent) seem to be the killer. Note that Adam Smith hated rent.
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