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Comment by erellsworth | Hacker News Reader

I find the general acceptance of the idea that increased wages will automatically be eaten by inflation fascinating. If this idea is true, it means the whole system is designed so average workers can never get ahead. In other words, the game is rigged.

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>If this idea is true, it means the whole system is designed so average workers can never get ahead. In other words, the game is rigged.

This is not a case of if, this is the truth. It's just a modern spin on feudalism.

Agreed.

Economics is about dividing up scarce resources "dismal science". You can't have the real purchasing power of the average person go up without there being more stuff to divide up (more efficient production, more production, etc).

You can make things more or less equal, but inflation by itself doesn't cause this to happen.

Except Productivity HAS been going up ENORMOUSLY in the past many decades, while that immense increase in created value has NOT gone to the workers.

Where do you think it's gone? Complain about the wealthy all you want–their personal consumption of goods and services isn't that much higher than the average.

The very notion of "average worker" seems to disregard the fact that much of the current inequality arises from dispersion in labor compensation itself, not other components of GDP (that are quite residual anyway). If you want workers overall to be better off, you should be pushing for improved economic development and higher productivity.

Productivity and economic development have been growing steadily for decades. Wages, not so much.

Inflation isn't sentient, it doesn't "target wages". Inflation is a property of the economy, and it reduces the value of literally everything.

an equilibrium is reached after inflation drives up prices, in effect real wages don't grow

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