It is the same story everywhere. Price hikes are extracting more from the customers, while the additional profits are not making it to the employees. There is a parasitic middle man that is leveraging the narrative of inflation to profiteer.
These middle men can survive without further exploitation, but they are like runaway processes trapped in a loop, they have no awareness they can exit.
> Inflationary pressures mean businesses have faced price increases of up to 24 percent from tech vendors attempting to claw back margins.
> the additional profits are not making it to the employees
It's the businesses being squeezed here. What additional profits?
If that business then hikes their prices, are they evil too?
Actual compensation is higher than in 2000, and actual compensation has more than quadrupled since 1995. This post seems like more fun with math and stats and cherry picking dates(right before the dotcom bust) than anything.
1. stock options
2. stock grants
3. health plan
4. 401k employer contributions
5. sick leave
6. vacation leave
7. maternity/paternity leave
8. employer paid social security taxes
9. other payroll taxes supposedly paid by the employer
10. retirement benefits
> 1. stock options
> 2. stock grants
Very few regular people get these. Negligible if you consider the average worker.
> 3. health plan
I have not heard of an influx of health plans getting better over the last few years, have you? If anything, they seem to tack on more fees and deductibles every year.
> 4. 401k employer contributions
Negligible variations here, it's usually a single digit percentage. Haven't heard of a ton of employers suddenly upping these or anything.
> 5. sick leave
> 6. vacation leave
> 7. maternity/paternity leave
It's possible that employers have actually gotten a bit more liberal in these respects over the past few years. I am glad to see more companies acknowledging that paternity leave exists.
> 8. employer paid social security taxes > 9. other payroll taxes supposedly paid by the employer
Huh? How would this change my life for the better? Not sure this is a “benefit”, the employer wouldn't pay it if it wasn't legally required.
> 10. retirement benefits
You mean just the existence of a 401(k) plan? That's quite standard, few employers offer any sort of perks here; and they are usually large tech companies.
"Employer costs for employee compensation for civilian workers averaged $43.07 per hour worked in March 2023, the U.S. Bureau of Labor Statistics reported today. Wages and salaries cost employers $29.70 while benefit costs were $13.36."
https://www.bls.gov/news.release/ecec.nr0.htm
It's quite substantial across the board. Any attempt to compare wages with productivity is going to produce very misleading results.
And it seems inflation was higher so it actually wage shrinking
https://www.statista.com/statistics/1351276/wage-growth-vs-i...
The only people for whom money is still "real" are the ones who can't afford it. The rest are living in a world where money is unlimited and there are no penalties for abusing it.
Inflation in the US today is still transitory in nature, but you can look at other countries to see examples of entrenched inflation.
I’m not saying it’s a good outcome for society short-term, but if everyone kept getting raises to keep up with inflation, businesses would respond by continuing to raise prices.
We are getting to a point where the majority of people can’t actually start their lives because of wealth inequality.
Wealth inequality has only gotten worse in the U.S. in the past 10 years.
The truth of the matter is, life does not have inherent value in the U.S. (and generally the world mainly because the U.S. drives world economic models).
We’re entering an era where not as much human labor is going to be necessary, and our response to that is effectively starve out billions rather than spread the gains between our race.
At some point this is either going to go full dystopia, where you’re only value is what you create and what you were born with. Or it’s going to go into a revolution with the heads of the rich on spikes.
I know which one would at least feel better for the majority of people.
Like, literally, if they took NINENTY NINE PERCENT of that wealth away, he could only retire ONE THOUSAND TIMES. STFU billionaires.
https://www.cbsnews.com/news/elon-musk-net-worth-worst-loss-...
https://twitter.com/paulg/status/1591291952464801794
I see this common pattern.
1. Stock goes up: "Oh no, they are stealing from us"
2. Stock goes down: Silence
> And billionaires crow about taxes.
Not just billionaires. Even non-millionaires crow about taxes. Fix the leaky bucket first before filling it up is a good strategy.
Did it dwindle enough for the point to no longer be valid?
(No, not anywhere near close.)
Valid for what?
He can now retire comfortably 50,000 times. It's a good illustration of just how huge that fortune is, and how little someone needs that much money.
> It's a good illustration of just how huge that fortune is, and how little someone needs that much money.
A lot of that money is illiquid wealth that he helped create. Should he give that up to a corrupt politician to distribute "fairly" (cough buy votes for power cough) or should he invest in venues that better humanity.
He doesn't have a Scrooge McDuck type vault with gold coins.
I have some questions below, not to attack, but to understand this view.
1. Should no one have wealth beyond a limit set up by some politician? (lets leave aside what is a "fair" limit and assume politicians have omniscience in this regard)
2. If yes to #1, what incentive would that give for entrepreneurs to create?
3. Do you think wealth is not created? In the world, has wealth remained constant since 1000 AD (an example date). Wouldn't that imply value of human knowledge, creativity and effort is zero?
#2: Plenty, and do incentives really matter from $100B to $200B? They’re going for high scores at that point, not needs.
#3: Sure it’s created. I don’t think the distribution is correct with regards to who’s doing the creating.
Are you purposing the governement take 99% of ownership of endless corporations? That's pretty much what would happen, if you taxed 99% of billionaire's wealth.
And if you did that, who would the governement sell the shares to? Remember, you just taxes those nasty billionaires, taking 99% of their wealth, so there is no one to sell those shares to.
And next year, there are no billionaires left. And likely the economy has crashed, because yeah, the government knows how to run large corporations well.
All that "billionaire" means, is that the person directs private enterprise. Get over it. We need leaders, and they're it.
In the meantime what I've learned is that:
1. Billionaires have 10 fingers and 24 hours just like the rest of us. They are not superhuman, superintelligent, or even particularly good at anything. Many are on top of their organization simply by inheritance or successfully navigating internal organizational politics.
2. Greed is a real disease. It's a mental illness. We don't call it that anymore. But what would you call an obsession with acquiring thousands of times more wealth than is necessary to have a full and complete life? Many lifetimes!? There's some kind of serious pathology there.
3. Billionaires either inherit huge amounts of money or they create organizations that funnel money up to them. The day-to-day earnings of the organization are the operation of a huge pyramid of people who do real work. They're taxing the produced wealth of their org they sit atop of.
4. Most organizations can coast for months or years without any real leadership, but would sputter and stop instantly if the people at the bottom stop working. Our age's conceit is to think the guy with the rudder in the fog is the leader when there are dozens of slaves doing the rowing and fish are jumping in the boat.
5. Billionaires never get screwed. Ever. They have bad ideas all the time. They can literally fuck up until the cows come home and still get mega payouts and people still lionize them.
so if they’re billionaires on paper, can someone explain their lifestyle?
How does Gates own so much farm land?
Yall are actively fooling yourselves.
But billionaires, as I said, are a focal point in a capitalistic society. They direct the wealth they control.
There are indeed good and bad billionaires, just as there are good and bad dentists, janitors, and violinists. I wonder, in your world, how readily you realise this, in categories you villianize?
It seems more to me, that once you realised billionaires are human, you became angry with the the wealth they manage.
Did you become mad with other levers in our society, when you realised the same?
1. A wealth tax of 1% (we pay property taxes today this is no different) over a wealth of $10 million 2. End share buybacks (this is just stock price manipulation to enrich shareholders) 3. Tax corporations on the profits they report to shareholders, not the IRS. If corporations want to dodge taxes with nonsense ownership structures but want to brag about their profits to shareholders then fine, we’ll use that number instead
At the end of the day we don’t need billionaires to run corporations. Amazon would be fine without Bezos, as would Tesla, etc. There’s millions of competent people that exist that can run a business without privatizing all the wealth for themselves.
> There’s millions of competent people that exist that can run a business without privatizing all the wealth for themselves.
So why aren't they billionaires?
If you still think your labor is being stolen, start your own business, where you get to keep all the profits.
> the employer has all the leverage.
You don't need land to start your own business. Besides, if the employer had all the leverage, all the employees in the country would be working at minimum wage.
Affirmative consent can not be given in worker/employer relationships. Which makes the entire contract predatory.
It doesn't work with me, though.
> Affirmative consent can not be given in worker/employer relationships. Which makes the entire contract predatory.
Another rhetorical trick: A is not equal to B, therefore A is not equal to B.
Did you see the part in the history books where capitalism increased work hours and decreased real wages for workers for hundreds of years? Happy to provide sources if you're going to actually read and engage with them, and not going to just dismiss them.
That’s fine. A lot of our culture is based upon force and preserving vestiges of slavery.
This happens subconsciously. It takes a lot of reflection to understand a lot of what we’ve basically accepted as the way to go in the western economic model is beyond unfair and fucked.
> is beyond unfair and fucked.
Oh baloney. The US has the highest standard of living in the world. US poor live better than medieval kings. That's why literally millions of poor people from other countries try desperately to get in to the US.
A note about fairness. Life isn't fair. It cannot be made fair. Everybody's circumstance is different. Some are taller, some shorter, some smarter, some dumber, some healthier, some sickly, it goes on and on. Just look at sports teams. They're all about exaggerating how unfair it is.
But what the US does try to do is:
1. have everyone equal under the law
2. guarantee certain fundamental rights
The rest is up to you to make the most of your opportunities. Note that (1) and (2) are under relentless assault in this country, often in the name of producing equal results.
Do you think only businesses worth billions of dollars should exist? And all small and medium sized businesses shouldn’t?
If "millions" of people are as competent as billionaire managers, why aren't those millions also billionaires?
EDIT: Sorry for the snark. The answer is: unequal access to capital, opportunities, connections, not to mention "intangibles" like education, safety, free time, comfort, lack of caring responsibilities, etc. Was 86-DOS superior to its competitors (or was Bill Gates a uniquely talented/hardworking individual)? Probably not, but he did have every advantage possible: most importantly lots of money and his mum putting in a word for him with IBM's CEO (and the rest, they say, is history ;))
Having used it contemporaneous with MS-DOS, no, it was not. It wasn't as good, and several times more expensive. I assume you meant Gary's OS.
Bill Gates actually initially declined the offer from IBM and SENT IBM TO GARY! To say Gary had no chance is just inaccurate. Gary muffed the deal, and IBM went back to Bill, and this time, Bill wasn't going to miss the opportunity.
Microsoft was started for something like $5000. An advantage nearly every businessman in the US had.
It doesn't stop people at a certain point, because at a certain point the money just isn't "real". If you could earn 60% of a billion dollars, would you take that deal? Of course you would. anyone would. 400 million dollars is a staggering amount of money for anyone.
[0]: https://www.aerotime.aero/articles/25483-howard-hughes-aviat...
As for Musk, if he didn't make a lot of money, SpaceX never would have been possible. His wealth is all invested in his companies, and he uses it to create more companies.
For example, requiring employers over a certain revenue to have a workers council, and a seat at the board.
Creating stronger union protections. Not weakening them.
Requiring sick pay, paid time off, etc etc.
Limiting the abuse of using contract workers to avoid doing benefits.
Also, the U.S. economy can’t be compared with anywhere else because we are the reserve currency. The control we have over our economy is literally not possible anywhere else. When we didn’t have this control, our economic policies led to the great fucking depression.
That policy was, specifically, tying the exchange rate of the dollar to gold while inflating the hell out of the dollar - Fed policy enacted in the 1914 Federal Reserve Act. This disconnect between the dollar's value and gold's value eventually caused a run on the banks which collapsed them, as you could buy gold for half price. The depression did not start to recover until the government halted gold purchases.
> While doing better on nearly every other social aspect.
Debatable. I've lived in foreign countries.
I'll take optimising for well-being (with a "strong economy" as a mere tool for that, not an end in itself) over "muh gdp" any day now.
It is not a "devastating" level of poverty. The US is not a 3rd world country and the 3rd world poor are desperately trying to get into the US, literally by the millions.
The US poverty rate stopped declining in 1968 when the government began subsidizing it.
For the record, I don't advocate confiscating 99% of their wealth as some scheme to fund the government. (Did I mention the government? no). And I don't advocate confiscating the money out of spite or a sense of moral obligation. But as a society we might want to consider the instability that every example throughout history suggests. When the peasants revolt, they don't tax the rich, they chop their heads off. (And for the record, I am not advocating that either, sheesh).
I mean, I'd like to give you the benefit of the doubt here, because I can't really know what you really think in depth about such issues, but if you wanna sling meme solutions then it's hard for me to not to fill in the blanks with the rest of it, which is a bunch of corporatist stuff masquerading as today's libertarianism.
> We'd have more than enough money if we had sensible tax policies (read: higher taxes on corporations and the rich)
There isn't enough there to fund the trillions in deficits.
As for who benefits from corporations doing well, did you know that something like 60% of Americans have investments in the stock markets and much of the rest have pension plans invested in stocks?
> The billionaire class also pays less taxes than any other income bracket in the country.
Obviously, they don't pay less than the 0% income tax bracket.
> As for Musk, if he didn't make a lot of money, SpaceX never would have been possible.
Sure, (1) every centibillionaire calculated that they would only do what they do if they got 100,000,000,000$ out of it, for (say) 50,000,000,000$ they wouldn't have gone through the trouble, and (2) no other human could possibly do what Elon Musk does[1]. Praise Space Jesus, hallowed be His name.
Give me a break...
[1] Hint: good marketeers are a dime a dozen.
Except everyone told Musk that what he was doing was impossible, and nobody else did it.
> good marketeers are a dime a dozen
Read one of the many biographies of Steve Jobs and then get back to me!
Except it's not in practice. Yes that's what's taught in academia, but is very often very wrong.
Supply shortages was the primary cause of our inflation two years ago.
Energy inflation then took over and also was the primary driver of inflation in the 1970s.
It's just a convenient short-circuit to blame it on wage inflation.
Concerns about wage growth is a primary reason why the Fed has been raising rates aggressively. They need to slow down economic activity so that wage gains cool. It's just politically toxic to say that explicitly, so they talk about other macro factors when pressed about it. Read between the lines here and you'll see that the Fed has been laser-focused on the wage-price spiral effect: https://www.bloomberg.com/news/articles/2023-03-01/best-bet-...
Yes I agree that is what is commonly taught. A causes B. And it's true A (broad wage gains) can and do cause B (inflation).
However it does not mean that B is usually caused by A. And that's the actual slight of hand that's happening here.
To understand simply look at these two graphs. Monthly inflation since April of 2020 and us unemployment rate since then.
https://www.statista.com/statistics/273418/unadjusted-monthl...
Notice annual inflation (presented monthly) grew enormously beginning around June of 2020. Peaking at 9% plus in June of 2022. It is now steadily falling and down around 5% and likely will continue to fall.
Now take a look at us unemployment during that same time. Unemployment shot up around the same time in 2020 (which should've caused significant disinflation according to the direct interpretation above which it didn't). It also has been consistent at around 3.5-3.6 percent for the past almost year+ and inflation has consistently fallen.
https://data.bls.gov/timeseries/LNS14000000
Looking at it, there is essentially no correlation with our actual experienced inflation and our actual experienced unemployment rate. If anything at times it was negatively correlated (the opposite of what was above).
Hence the reason I say, that it is the commonly spouted economic orthodoxy and it is what is taught and discussed, but you can see clearly it was not the cause of our recent inflation. Nor was it the cause of our 1970s inflation, and other instances of inflation. Frankly I'm shocked that economic orthodoxy hasn't caught up to this - and I'm starting to see some rumblings that following this episode in the 2020s it will. But if it does, the update will be motivated by popular culture / media discussion prompting it, which is extremely disappointing to see for any science field - regardless of whether it's a hard science or soft science.
So in short - A implies B, does not mean that B implies A. And that's essentially what is being discussed here. We experienced tons of inflation and it wasn't driven by wage growth. Stomping out wage growth is not solving he underlying problem. Energy costs and fixing the supply side is what would (and will address the root cause). Energy has mostly fixed itself (from it's peak) and supply is much better but still having some issues.
1. wage/price spiral
2. cost push
3. demand pull
4. speculators
5. profiteers
6. Vladimir Putin
7. Arab oil cartels
8. unions
The actual cause of inflation is the government helicoptering money all over the economy that has just been printed.
I.e. the Law of Supply & Demand applies to money just as it applies to everything else.