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For Decades, Wages Haven’t Kept Up With Inflation: Why?
You constantly hear that, for decades, wages haven’t kept up with inflation. You are now hearing that wages REALLY aren’t keeping up with inflation because inflation is super high.
That should give you a hint. The reason wages aren’t keeping up with inflation is that our money is being devalued. It wasn’t just the last couple of years that the Federal Reserve has been printing money; it is almost always creating/printing currency to some degree. And they’ve printed a lot of money since we left the quasi-gold standard (Bretton Woods), so perhaps that has something to do with it? That’s my hypothesis. Does my hypothesis lack simplicity? Explanatory power?
Everyone is having their wages devalued due to inflation, and I’m not telling you to feel sorry for someone who makes a lot of money.
But why are some people not making a lot of money and likely wouldn’t even if there wasn’t a lot of inflation? Because their job isn’t in very high demand. That doesn’t mean I want anyone to be poor. The solution is to try and get people into skilled work. Merely increasing wages by government decree is just price controls. Supply and demand is an economic law, so don’t fight it. You might as well revolt against the law of gravity: that’s how insane some people sound about this issue.
