There is no #WagePriceSpiral. // #neoliberalism #economics

Keine Panik vor höheren Löhnen —

Die #Inflation wird nicht von Lohnerhöhungen getrieben, sondern von Energiekosten und #Gewinnen großer Firmen. Die Reallohnverluste sind so hoch, dass der #Arbeitskampf verständlich ist. Es gibt keine #LohnPreisSpirale.
Marcel Fratzscher Kolumne für @zeitonline: https://www.zeit.de/wirtschaft/2023-03/lohnerhoehung-arbeitsmarkt-inflation-arbeitgeber-produktivitaet

*Two thirds* of US companies increased their margins over the first two years of the pandemic. Prices didn't go up because poor people overspent their CARES Act money. Inflation wasn't just a matter of supply-shocks. I accuse monopolies, in the economy, with the profiteering:

https://www.wsj.com/articles/inflation-yellen-biden-price-increase-cost-shipping-supply-chain-labor-shortage-pandemic-11636934826

There is no evidence of a #WagePriceSpiral. Wage growth peaked in June at 4.8% and by October it had declined to 4.2%, making real wages 2.3% lower than they were in Oct 2021.

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The two esteemed economists compared interest rate hikes to medieval bloodletting, where "doctors" did "more of the same when their therapy failed until the patient either had a miraculous recovery (for which the bloodletters took credit) or died (which was more likely)."

As they document, workers today aren't recreating the dread #WagePriceSpiral of the 1970s: despite low levels of unemployment, workers wages still aren't keeping up with inflation.

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Let's start with the case against bloodletting. #InflationHawks warn us of the #WagePriceSpiral, which is when inflation goes up and powerful workers bargain for higher wages, which drives up costs, and thus prices, and thus wages. This is the fairy-tale version of what happened in the 1970s and it's entirely true except for the fact that it was #OPEC's #embargo driving up oil prices that caused inflation, a fact that makes it entirely false, but oh well.

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