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Comment by logicchains | Hacker News Reader

It's very simple: the pay at TSMC is shit by American tech standards and Americans capable of doing the job generally have much better-paying options. Paying US-competitive salaries would basically double TSMC's labor cost.

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Yeah, this is just simple principles: Garbage in, garbage out. If you're only offering little more pay than an entry level fast food worker, your quality and productivity will match that.

The real theme of the post-08 crash is "no one wants to pay americans anymore". And it's only been spreading from industry to industry as the billionaires figure out how to cut american labor but benefit from american consumerism.

That can only work, of course, until the American consumer is tapped out. The you get another crash.

America does have cost disease, but it’s from more than just politicians spending too much. It’s also things like NIMBYs restricting housing supply or the insane bureaucratic explosion in health care.

It's simpler principles: cost of living is different in different countries, and politicians generally get votes for promising to spend money (raising the cost of living) or doing other COL-raising activities, rather than to save it (thus potentially lowering it).

There are no solutions; only trade-offs. And the US, like many first world countries, has picked trade-offs that raise the average COL.

Cost of living never goes down if productivity is going up

Why is that? If I replace a team of 20 admin staff with 3 admin staff and Microsoft Office licences to replace a paper filing system with a digital one, haven't I raised productivity and lowered prices?

Productivity increases -> wages go up -> "30% of salary on rent" goes up -> rent goes up -> cost of everything goes up

We could arrest pretty much all cost of living growth if all renters (both businesses and individuals) just decided not to continuously agree to pay higher prices for the same land/apartments/buildings.

> Productivity increases -> wages go up -> "30% of salary on rent" goes up -> rent goes up -> cost of everything goes up

Yes wages might go up (someone who can use Sharepoint[0] is probably more efficient than someone who can use a physical filing system) but you need far fewer people to do it. So costs can still go down.

> We could arrest pretty much all cost of living growth if all renters (both businesses and individuals) just decided not to continuously agree to pay higher prices for the same land/apartments/buildings.

I agree that most of cost of living is housing-related, but rent price increases are a function of population increasing faster than housing. That's the thing to address.

[0] or something good

I didn't say the costs of individual items or services never go down, I said the "cost of living," i.e. broad-based growth in costs over long periods of time, goes up with productivity.

> I agree that most of cost of living is housing-related, but rent price increases are a function of population increasing faster than housing. That's the thing to address.

Yes we should build a whole lot more and it will slow residential price growth, but no, in general this will not actually reduce the cost of living. For example, this doesn't address the increased competition (i.e. increased prices) for commercial spaces, which gets baked into every coffee, garment, or meal you purchase.

Okay, but coffee and meals are luxuries to purchase, not necessities. And it's extremely clear that the thing that's rocketed up in price, and delivered less and less over time, has been housing. We (e.g. here in the UK) now pay far more than our grandparents did for smaller dwellings. This is the main cost of living increase. And it's baked into all goods you buy far more than commercial rent, because every employee in the supply chain has to be able to afford to live.

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