Where will inflation stop?

In reply to pheller :

I've been having that argument with our company HR department over the last few months.  They are upset because I refuse to play the game that to me seems aimed at younger employees looking for advancement. I am already at a pay and responsibility level that far exceeds my expectations. I don't want to advance. I'm perfectly content to continue doing my job designing stuff while counting the days until I can retire. 

frenchyd said:

In reply to AaronT :

You are correct. But just stating it like it isn't easily solved. 
     Unions

    They raised wages high enough so a working father could send his children to college, provide a decent living, and an 8 hour work day, leaving much of the of the rest of the day  for rest and time with the family. 
  Today to achieve that requires 2&3 jobs and no time with the family. 

Oh, you mean the same unions that drove entire heavy industries overseas and burdened so many US products with wage / pension requirements and lack of quality control that they became completely uncompetitive?

Management was ALSO bad in that era, but let's not forget the unions that helped kill the golden goose.

In reply to AaronT :

I think it's a much less interesting take when you take a critical look at the question and the answer. The reason people don't get paid a living wage is because big businesses are a de facto part of the government. There's no incentive to pay more because there's no law requiring it. The businesses hold a disproportionately large power in wage negotiations, contrary to protestations of the invisible hand disciples. This is by design.

At a certain point beyond the amount of money needed provide safety and comfort you reach greed. It's much easier to handwave this away with education (which is code for perpetuating the gulf between the top and everyone else), the retirement home (is this supposed to resonate with anyone?), but the last one is hilariously tone deaf. I think my employees deserve to financially struggle, despite working hard, so I can pretend to be Jesus in Africa once every few years.

The implication is that these things are things only a few deserve to desire, right? And your friend is implying that his employees should not want or need to save for their children's education, or for a retirement home, or to feed themselves, wait, kids in Africa.
 

I posted a couple pages back a whole list of what various business types net. It's not a secret, or some government conspiracy, financials of the large corporations you are taking about are public record. Many LOSE money. If you want to point the finger at greed, point at the consumer. We want cheap stuff, so we outsource a lot of our jobs to countries where labor is cheaper. If you are going to complain about man's greed and unfairness to man, why stop at our border? The low wages you  complain about define wealth in many countries, why aren't you championing  the cause to even that out too? Make everyone equal. Which means your standard of living will drop. Sounds different when other people want you believe you worked for, doesn't it? 
 

Labor and our whole system of commerce is based on a simple principle. You trade your labor/skill/resources for other people's labor/skill/resources. Why should you get more from the deal than you contribute? The truth is, very, very few of us ever produce enough to match what we take in this country. Most advances in our society exist because of the efforts of very few. Many of those advances would not exist without incentive. We are as fortunate as we are because our society supports innovation. And we are able to capitalize on other countries that don't in the form of cheap goods. People argue that  people should own homes and new cars- why should someone build you a house, build you a car, grow your food, make your clothes, provide for your utilities, while you stack boxes or flip burgers? Nothing against stacking boxes or flipping burgers, but those jobs are not intended to support a family of 4. Unskilled labor is only worth so much. Go past the limit, and inflation erases any perceived gain, or the jobs are eliminated entirely. Hello self checkout.
 

There are countless people here that started at the bottom and succeeded. Yet they are ignored by the "life is rigged and unfair crowd." It's like getting instructed by a pro driver but ignoring him and blaming your tires. Every single one of us is lucky, winning the cosmic lottery to live here, now. Everyone has the opportunity to succeed. Some do it more quickly and easily than others. But for most of us it's an endurance race, not a sprint. But you will never succeed sitting in the pits complaining about your tires. 
 

When I said that people need to work to move up, I didn't mean only literally to management positions. As others have shared, lots of us are successful outside of management. Specialize in something. Learn a rare or valuable skill. You don't need college or a trade school (they help,) many employers will invest in employees that are willing and able to learn. Doing unskilled labor the best you can is great, but it's not going to move you up the ladder by itself. People have mentioned the trades. Yes, it's tough to swing a hammer or pull pipe your whole life. But there is a lot more to learn about construction than physical labor if you apply yourself. Lots of related less physical, more skilled jobs that pay very well.

In reply to Boost_Crazy :

That's a really excellent post. 

Boost_Crazy said:

Labor and our whole system of commerce is based on a simple principle. You trade your labor/skill/resources for other people's labor/skill/resources. Why should you get more from the deal than you contribute? The truth is, very, very few of us ever produce enough to match what we take in this country. Most advances in our society exist because of the efforts of very few. Many of those advances would not exist without incentive. We are as fortunate as we are because our society supports innovation. And we are able to capitalize on other countries that don't in the form of cheap goods. People argue that  people should own homes and new cars- why should someone build you a house, build you a car, grow your food, make your clothes, provide for your utilities, while you stack boxes or flip burgers? Nothing against stacking boxes or flipping burgers, but those jobs are not intended to support a family of 4. Unskilled labor is only worth so much. Go past the limit, and inflation erases any perceived gain, or the jobs are eliminated entirely. Hello self checkout.

An interesting theory, as personally distasteful as I find this "great men of history" sort of approach to economics, it has good logical consistency to it, but I have two issues with it - first I suspect you have some variables wrong, in that you're artificially misallocating productivity, and two if your theory IS correct, then the economy actually requires unsustainably cheap labor from people who are practically forced to do it because they're trapped in bad situations (fun point, I have actually heard a business owner openly argue that this is in fact the case, that this is just how the system works).

Onto the first issue, I suspect flipping burgers or stacking boxes should produce enough value to support a livable wage - not necessarily sustain a family of 4 single-handed, but decently support one person or maybe two on a tight budget. This has happened in a few countries at various points throughout history, and is still happening in a few countries today, mostly in Scandinavia and Europe, and the only reason it isn't is that outside of those situations the productivity of the company's output has been misallocated onto those Few Great Men, who according to economic stats have seen their wealth explode over the last few decades while wages for the workers fall or remain stagnant at best, especially as a share of overall productivity. And what is so special about those Great Men that makes them worth so much? Is a day of high-level managerial work really worth more than a year toiling away at most any other profession? We've had CEOs make plainly disastrous decisions that lead companies into ruin (WeWork and Nokia stand out) while collecting more money than any worker could gross in a lifetime. Does being a CEO require more knowledge than being a doctor or an engineer or a full-stack web developer? I suspect not.

Giving a few people a lot of excess wealth can do a lot of bad things to the economy, the more money you give a person the greater the percentage of that wealth will go into cash savings and investments rather than goods and labor, and the more they will spend outside the country. In short, wealth concentration takes money out of play for most of the economy, while wider-spread wealth, especially on the lower end of the economic ladder, will spread rapidly to other workers and stays local.

Onto the second issue, if your theory is correct and we need some people who have no other options to work in grinding poverty or even work themselves deeper into poverty ("Gig economy," looking at you) to keep the economy as we know it afloat, isn't that a moral failing in the system we should address? That's drifting dangerously close to indentured servitude and we know there are working alternatives.

Trucking costs are down.  Lots of direct to consumer brands are having hiccups. 
 

correction coming. 

In reply to Fueled by Caffeine :

Timeframe?

In reply to 1988RedT2 :

I wish my crystal ball was that good. Sorry man 

In reply to GameboyRMH :

Do you shop based on price or do you buy based on which company takes the best care of their employees? 

I can promise you, that no one cares if I'm nice to my employees or not. There's not a line on an estimate sheet that says I pay the best or am the nicest. It all comes down to cost. 

Fueled by Caffeine said:

In reply to 1988RedT2 :

I wish my crystal ball was that good. Sorry man 

C'mon man!  I have a lot of confidence in your prognosticatory talents.

Toyman! said:

In reply to GameboyRMH :

Do you shop based on price or do you buy based on which company takes the best care of their employees? 

I can promise you, that no one cares if I'm nice to my employees or not. There's not a line on an estimate sheet that says I pay the best or am the nicest. It all comes down to cost. 

 

 

If an employee is nasty to me because he is pissed at the boss, I can and have taken my business elsewhere. I might actually pay a little bit more to not have to deal with that kind of clusterberk. If your low cost employee actually looks like he is homeless and just hired off the street, and might be an excessive user or recreational pharmaceuticals, I might just hesitate letting him into my house to fix something or let him work on my expensive car.

Toyman! said:

In reply to GameboyRMH :

Do you shop based on price or do you buy based on which company takes the best care of their employees? 

I can promise you, that no one cares if I'm nice to my employees or not. There's not a line on an estimate sheet that says I pay the best or am the nicest. It all comes down to cost.

Both are factors. I've been drastically scaling back my Amazon purchases over the last few years because of how they treat their employees for example. I've also been avoiding computer manufacturers found to have ties to Chinese slave labor.

Edit: Also I don't use any "gig economy" apps, mostly for the same reason but privacy is also a factor there.

I think part of our challenge right now is that 35% of the economy is more able to purchase foreign made "stuff" and are highly price conscience consumers with little care about service or where something is made.

They don't own a home, so they have little need for local labor, and when they do, they scoff at the price (auto mechanic, medical bills, restaurants) - this drives them towards finding the cheapest possible solution or incurring debt to avoid it all together (buying a new car when an old one is perfectly good, avoiding paying medical bills, going for fast food instead of sit down.) 

It's easier to afford video games, the newest phone, a big tv and a bunch of streaming channels than it is to purchase a house. As the house becomes more out of reach, the interest in climbing the wage ladder falls off, and people just become content with the stuff they've got. This creates a race to the bottom. 

Less available debt (or no easy money) could motivate some of the population to climb the wage ladder, but the folks at the top still have to be willing to pay them. 

In reply to GameboyRMH :

You are assuming the "great men of history" are the CEOs who are currently being paid high salaries. In almost all cases, they most certainly are not. 
 

The inventors of products like Coke, the iPhone, and the automobile are the "few great men" who have produced enough to match what they take in. Not overpaid CEOs. 
 

And yes, our economy is absolutely based on having "cheap labor from people who are practically forced to do it because they're trapped in bad situations".   It's a world economy. There are plenty of people who will work cheap (by our standards) so the wealthy (us) will buy the products they build with their labor. 
 

You may have stopped buying from Amazon, but you didn't stop buying. And those computer components you buy are made by people who work in places that don't regulate the negative impact of the work on worker health and safety. 
 

There is almost zero chance you can buy a pair of shoes that were not made in the equivalent of a sweat shop. 

In reply to 1988RedT2 :
 

Cost per mile drop is small, but significant due to high diesel prices.

SV reX said: There is almost zero chance you can buy a pair of shoes that were not made in the equivalent of a sweat shop. 

It is very, very hard.

I am also very weary of the "Great Person" concept. There are a few that really, really deserve it. Savvy inventors and business people who really innovated and changed the world somehow. Yet as I look back many of those are built heavily on the backs of others...bad working conditions, low worker pay, union busting. Not to mention how many businesses end up as downright fraud ... mortgage bonds, Enron, Trump, Ponzi, Wells Fargo, VW Dieselgate, MCI Worldcom... at the helm at all of these were some big personalities that were too big to fail. We all paid the price.

Fueled by Caffeine said:

In reply to 1988RedT2 :
 

Cost per mile drop is small, but significant due to high diesel prices.

An interesting read.  Thank you.

In reply to Paul_VR6 (Forum Supporter) :

Again, there was nothing in BoostCrazy's post that said ANYTHING about who was at the helm of what company. 
 

He said, "The truth is, very, very few of us ever produce enough to match what we take in this country. Most advances in our society exist because of the efforts of very few."

For what it's worth, there are 39 people in my company with the same job title I have (commercial construction supervision). I am 60. Only 2 of them are younger than me.  1 is 81.
 

My company hires experience, and so does every construction company in the country. Almost every company I know would hire a 60 year old man right now who understood the industry.  Frenchy, with your experience, you could have easily transitioned to construction supervision. 

You applied for the wrong jobs.

Yes, you are the poorest millionaire I know. 

SV reX said:

You are assuming the "great men of history" are the CEOs who are currently being paid high salaries. In almost all cases, they most certainly are not. 
 

The inventors of products like Coke, the iPhone, and the automobile are the "few great men" who have produced enough to match what they take in. Not overpaid CEOs.

So if these obscure inventors are the "few great men" and the justification for maintaining a highly unequal economy is supposedly to give them extreme incentives, why aren't they the ones making all the money rather than CEOs? Are accidentally creating a class of capitalist neo-royalty and an impoverished underclass of not-so-voluntary workers just an unfortunate side-effect of the system required for inventors to quietly become moderately wealthy? I would argue both that there are better solutions and that inventions tend to be made of many smaller inventions, so to lump all of the credit for them onto the single inventor of the a product is another case of misattributing productivity. Cars and modern smartphones are also both excellent examples of devices that are hard to attribute to an individual inventor because the concept had been tried and refined over time by many different inventors independently.

SV reX said:

And yes, our economy is absolutely based on having "cheap labor from people who are practically forced to do it because they're trapped in bad situations".   It's a world economy. There are plenty of people who will work cheap (by our standards) so the wealthy (us) will buy the products they build with their labor.

I wouldn't necessarily describe hiring labor more cheaply from countries with lower labor costs as exploiting people trapped in bad situations. Example, some Indian chefs I once met who were making around US minimum wage (in a place with a very high cost of living) but were just exploding with happiness because for them it was a massive windfall, they were making far more money than they'd ever seen in their lives and were sending a lot of it back home to support their families. The fact that they were all roommates packed into an apartment within walking distance of where they worked so they could afford to get there was a minor footnote to them. Maybe it wasn't good for the local labor market but the chefs thought they were being very handsomely rewarded, they were far from forced into that job, it was an opportunity they were overjoyed to have. What's definitely not good is hiring anyone anywhere in the world with a wage that they can't fully support themselves on, a job they only take because there are no better options available, which is quite common in the first world as well. An example of that would be the call centers in 3rd-world countries that have harsh working conditions and unremarkable local pay.

SV reX said:

You may have stopped buying from Amazon, but you didn't stop buying. And those computer components you buy are made by people who work in places that don't regulate the negative impact of the work on worker health and safety. 
 

There is almost zero chance you can buy a pair of shoes that were not made in the equivalent of a sweat shop. 

This sounds like nirvana fallacy. If most of the computer components I buy are made in Taiwan or South Korea, those treat their workers better than a Foxconn factory which in turn is better than the companies that simply use slave labor from Xinjiang. Improvement is worthwhile without perfection.

The vast majority of shoes are made in places that could be reasonably described as sweatshops, but it's actually quite easy to buy some made in the first world, even by well-compensated workers - they just cost 2-6x as much and you can't pick them up in an ordinary department store.

In reply to SV reX :

Construction is one industry. Largely dominated by men. Specifically men who have swung enough hammers at nails, pulled enough wire, dug enough ditches, to be able to be critical of the young guys still doing it. What of a female 55+ candidate in your industry? 

It's a bit naive to say "ageism isn't a thing because I don't see it in my company." 

You work for a good company. That's probably an outlier. 

EDIT: In my company, we value experience for sure, and many women are moving up the ranks, despite their age. We recently hired a woman in her 50s to run one of our districts. That ruffled a lot of feathers among men who thought they deserved it more.  I just have a hard time believe every industry, every employer will extend that offer to every older candidate. 

Ageism is so bad in IT, it's just an accepted fact in the industry that once you're past 50 or so, nobody is ever going to hire you, and some companies may go out of their way to squeeze you out (see the IBM "dinobabies" scandal). Your options for dealing with this are to "bunker up" - get a secure IT job before you reach that age and hang onto it until you retire, almost certainly in IT management - or to start your own business. I knew this before getting into it and just figured I'd take the latter option at some point because I'm not interested in management.

In reply to pheller :

I lost certainly didn't say anything about agism. 
 

Yes, my industry is dominated by men. No, it doesn't really have much of anything to do anymore with experience. 
 

I am of the opinion that woman would be better construction superintendents, and have pitched a proposal outlining it to my company. I suggested a very viable path to hiring retiring homeschool moms as construction superintendents. Under consideration. 
 

Don't assume quite so much about construction. The industry is changing rapidly. It's not what you think it is. I have strongly encouraged both of my daughters to pursue careers in construction.

Of course, none of this has anything to do with what I said. I encouraged Frenchy that HE could have considered a career in construction supervision, and that his age would not have been a detriment.  

In reply to GameboyRMH :

Nope. Not a nirvana fantasy. 
 

Based on my own experiences in both the chemical industry and living in a couple third world countries. 
 

Yes, many of the individuals are being paid much more than they could make locally. No, they are not protected by safety protocols such as OSHA. 

When I was in the chemical industry, the products we had manufactured overseas were specifically because the manufacturing processes were too dangerous to be allowed in the US (and many of the waste products were being dumped into waterways by our overseas producers). Our overseas site visits and audits were unpleasantly revealing. Several of those chemicals were used in the manufacture of semi-conductors. 
 

Do you really think those products produced overseas are safe to manufacture?  THAT sounds like a nirvana fantasy...