Most jobs are selling your time in exchange for money. If your time is mostly fungible compared to someone else's time (ie. most low-skill labor), then I'd say all the algebraic equations expressed in the OP are true. He is essentially modeling supply/demand curves of typical scenarios involving "human capital."

In the past, the value of human capital -- the amount you got paid for selling your time for money -- used to be more lucrative. At one point nearly half of Americans were in a labor union, which artificially constrained the supply of human capital so it would be worth more. Conversely, our previous industrial revolutions required a great deal of human capital (building factories, sewers, etc), generating lots of demand that would keep the value of human capital high. Due to political and technological changes, this is basically no longer the case.

If you're a software engineer, then none of these models apply to you because you are high-skill labor (also sometimes called "talent.") You're paid for your time, but your productivity can be orders of magnitude higher than your pay. In the OP's "expendability of labor" graph, the "sweet spot" is enormous. In my nearly ten years as a software engineer, I've seen colleagues laid off/fired for all sorts of reasons, but none of them were due to, "well we did the math, and we decided your production is not worth your salary." I've seen layoffs where the executives literally admitted they would make less revenue/profits due to the lost productivity of the laid off workers not offsetting the savings in salary, but they had to hit a certain "profit percentage" or some other absurd reason that justified the layoffs.

In any event -- I've thought a lot about the macro-society impact of this new model of economy, if we're truly destined for a world where human capital is just not that valuable. My interest in politics and healthcare has largely been based on this -- what should we consider "subsistence living," and what happens if we reach an inflection point where most jobs paying for human capital are below it?

It's possible, of course, that this will all be moot, and our next industrial revolution will have a huge demand for locally-based human capital (e.g. a "renewable energy industrial revolution scenario," where there is a huge demand for laborers that can install solar panels on houses, or something), and the median income for Americans will increase. Or it's possible for a more gradual shift to happen (e.g. the graying of the baby boomers causes a gradual increase in demand for local caretakers of the elderly). But I'm not sure it's a good idea to just assume that will happen.