07-04-2016, 07:52 PM
(05-23-2016, 09:41 AM)Anthony Wrote: But Trump's Malthusian policies would render any statutory minimum wage irrelevant - since even the most menial jobs would command even higher wages than any political faction would advocate raising the statutory minimum wage to.
And we know this to be the case because of what happened in the 1920s: Two years after cutting off essentially all immigration in 1924, unemployment plummeted to less than 2% and everybody ran off and bought cars and radios, and wired up their homes for electricity and telephone service; if their wages hadn't skyrocketed, they would hardly have been able to afford to buy and do these things.
Wages, whatever they did, did not soar. They rose more slowly than productivity, which allowed unusually-high levels of profits. Economic inequality intensified during the late 1920s to an extent that Americans would not know for another eighty years.
Productivity increased due to the electrification of manufacturing facilities. The imbalance between profits and wages allowed consumer spending to lag GNP, and much of the profit went into speculative activities in a bubble economy because opportunities for further profit other than speculation disappeared. We all know the rest.
In the Double-Zero decade, many businesses experienced new growth of productivity through cost cutting due to computers and the Internet. Wages also failed to keep up with profits, and a speculative boom ensued.
1929.4-1931.2 and 2007.4-2009.2 make excellent parallels. The number after the year indicates the quarter of the year. Of course political leadership in 2009 and 1931 were very different.
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