Tuesday, March 30, 2021

Inflation: Who Matters? — Peter Radford

Apparently Wall Street bonuses have risen 1,217% since 1985. Quite what the significance of 1985 is I cannot tell, but the number itself seems to have the right feel. Having seen a few of those years first hand I can attest to the pace of increase from an anecdotal perspective.

More importantly, if we applied the same rate of increase to the minimum wage over a similar period it would stand at $44 per hour and not the current rather pathetic $7.25.…
For conventional economists, the only actual inflation that needs to be considered is wage inflation (Phillips curve).

The Radford Free Press
Inflation: Who Matters?
Peter Radford

1 comment:

Ahmed Fares said...

re: what happens when you ignore basic economics

Mandated "hero pay" will add up to about $0 an hour for some grocery store workers in Los Angeles. Grocers there are closing three stores in response to newly enacted legislation that requires them to pay their workers an additional $5 an hour during the pandemic.

"It's never our desire to close a store, but when you factor in the increased costs of operating during COVID-19, consistent financial losses at these three locations, and an extra pay mandate that will cost nearly $20 million over the next 120 days, it becomes impossible to operate these three stores," said grocery store chain Kroger in a statement given to CBS Los Angeles, announcing that two Ralphs-branded stores and one Food 4 Less location, would be shutting down.

The closures come after the Los Angeles County Board of Supervisors passed its COVID hero pay ordinance in late February. A near-identical $5-per-hour hero pay law was passed by the Los Angeles City Council in early March.

"The fallout from the misguided extra pay ordinances is enormous and politicians are to blame," said Ruben Guerra of the Latin Business Association in a Wednesday-issued press release. "Workers will lose jobs, and communities of color will be left with fewer grocery options and more food insecurity. Consumers in other areas where grocery stores are able to stay afloat will pay higher grocery bills."

source: 'Hero Pay' Requirement for Grocery Workers Results in Unemployed Heroes