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FULL EMPLOYMENT AND WAGE INEQUALITYU

April 27, 2018

FULL EMPLOYMENT AND WAGE INEQUALITY

So long as we have wage inequality (my chief beef) it doesn’t really make a lot of difference as to the number of jobs brought to town; many of those in such “jobs” still require public outlays such as food stamps by taxpayers etc., and such increases in human and automated labor at substandard wages in net terms do not materially add to aggregate demand (the sole arbiter of economic growth) and serve mainly to (in plain sight) perpetuate serfdom. So full employment is the answer? Hardly. We had full employment in the antebellum South prior to 1865, I note, and someone tell me how that “peculiar institution” (aka slavery) worked out. We seem to know how to create wealth but have big problems in coming up with its fair and equitable distribution after its creation – and there’s the rub – the creation of a niche ALEC has skillfully exploited.

Median wages have hardly moved since Reagan while the Dow has ballooned to astronomical heights, which is all we need to know in assessing the chronic and ongoing cancer of wage inequality to our economic system as currently practiced. So what happens to economic growth when aggregate demand is stagnant irrespective of the Dow? Nothing. Instead of expanding the economic pie (as we did following WW II up to Reagan marked by wages which rose in tandem with the Dow to bring us a bustling middle class), Republicans decided to hand over the lion’s share of the economy’s income and wealth to Wall Street, hence such perversions as buybacks, carried interest, hedge funds et al.

What to do? Do as others have; legislate a living wage (which will stimulate demand) while shifting use of tax money to education, infrastructure and other such areas designed for the common good. Can’t be done? Look around. Germany and Sweden have a bustling middle class in this automated age along with trade surpluses while we suffer by far the biggest trade deficits and the biggest poverty rate in the Western World. The difference is in policy and policy as of late is up to the highest bidder. We the People need to defang such as ALEC and their libertarian financiers and put an end to such “policies” this fall lest we all go down with the ship, so let’s do it in November!

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