cross-posted from: https://lemmygrad.ml/post/4173165
Finance bros be like
this post was submitted on 03 Apr 2024
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The wage-price spiral makes no sense on any level, since businesses will always sell their goods at the highest price they sustainably can, counterracted both by competition and demand reduction, with the only argument against this being that a summary rise in the minimum wage will increase the amount people are able to spend on goods across the board, and then there would be a nominal rise in prices but economic relations would remain the same, so nothing should be worried about.
An increase in wages by itself leads to a decrease in profit as a rule, but the claim that it also leads to a similar real increase in prices can only be true under monopoly, where a company that has complete control over a good must raise its prices to keep up with a pay increase demanded by workers within the company, and we know this is far from the rule as even companies with large monopolies like Amazon spend considerable resources to prevent worker organizing.