First, wage-price spiral is not a problem until you have full employment and all resource utilization is fully occupied. In that case, GDP can only be driven by inflation. Strong unions can push through real wage increase and cut into the capitalist profit, which was why the UK went into an inflationary spiral as it did in the 1970s because the capitalists did not want to give up their profit. The Keynesians did not have an answer for that, hence the neoliberals came in and crushed the workers unions.

Second, I agree with you that under current neoliberal system, where full employment is not reached, there won’t be wage-price spiral. Hence, you won’t find it in the IMF study that Roberts quoted.

However, for any socialist who is serious about bringing full employment for the economy to ensure the prosperity of the working class, you cannot avoid this problem. As I already presented, you either go with Stalin’s mechanism or the MMT price anchor mechanism.

If you ignore this problem, you WILL get inflationary spiral as the Keynesians did, and the next thing you know, your government is overthrown. Again, ignore this at your own peril. So many left wing governments continue to regurgitate neoliberal model and see how they end up.

[–] Melkonian@lemmygrad.ml 2 points 3 days ago (2 children)

Any serious socialist would not be using capitalist economics and markets to determine prices.

[–] xiaohongshu@hexbear.net 8 points 3 days ago* (last edited 3 days ago) (1 children)

Tell that to the Soviet and Chinese economists and all the Marxist economists.

[–] Melkonian@lemmygrad.ml 1 points 2 days ago

Would if I could, but we've got the benefit of hindsight and modern computing. Not sure which Marxist economists you are referring to, but if they are reinforcing capitalist economic propositions they should be discarded. The UK could have gone another way during the inflation of the 1970s, but the same old tired nonsense was wheeled out and we got the old Thatcher classic "There is no alternative."