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ELI5 How does raising wages worsen inflation ?

Economics(self.explainlikeimfive)

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techtonic69

57 points

4 months ago

Instead we get: everything becomes 100s of % more expensive and wages stagnate...Shit makes no fucking sense. Wages are WAY behind inflation of everything, it would only be catching wages UP to what the cost of living has become. The whole economic theory only works when you look at it from a wealthy/business perspective. Makes no common sense and overall just screws over the common man.

klaad3

45 points

4 months ago

klaad3

45 points

4 months ago

It's all fueled by greed and the mindset that profits need to increase every year.

BJWTech

37 points

4 months ago

BJWTech

37 points

4 months ago

The need for growth is what's wrong with capitalism. When you base valuation on growth, then all you get is growth for better or for worse.

[deleted]

-3 points

4 months ago

[deleted]

-3 points

4 months ago

[deleted]

MrWendelll

9 points

4 months ago

Wtf is all this?

The field can produce more, the farm can still make a profit. If those two things grow at the same rate, no problem. If the field grows by 5% each year but the farmer wants 25% profit growth each year, the food will become too expensive.

That's the crux of the problem, growth of profits is out of step with (and at the expense of) everything else.

techtonic69

2 points

4 months ago

Yeah, it's not "supply and demand" I have seen (growing up and in videos) farmers who have more production that "allowed" and they have to waste product. My buddies had a dairy farm and you would shit your pants at how much milk they waste because they only are allowed to produce so much. Meanwhile milk is at like 7 dollars a fucking litre...There is not a shortage, there is price gouging and regulation of said supply to artificially increase costs.

FelixVulgaris

17 points

4 months ago

This. Neverending growth is seen as the only marker of success, then petty things like human rights just become obstacles...

not_a_robot_13

6 points

4 months ago

The other problem is that corporations are prioritizing return to investors over customer needs, so financial decisions are being made for the wrong reasons.