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Jaguar Inflation -- A Layman's Explanation of Government Intervention
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2014 Dec 25, 9:41pm 21,303 views 65 comments
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Heraclitusstudent
2015 Jan 5, 12:29pm
"probably either move to an other country"
if only we had extra-market institutions with the power to control corporations!
What would they even look like???
"or go bankrupt"
The profits you are showing are for companies that already moved abroad: for example Apple employs (through providers) maybe 10 times more people abroad than in the US. Production is off-shored.
The people remaining in the US are those for which the market dictates a good salary.
However do you think people doing manufacturing in the US can simply ignore foreign competition and raise wages - because they have such good profits they don't care? I think not.
tatupu70
2015 Jan 5, 1:08pm
I'm not sure I understand your point. Companies sell products in 1 market, employees are hired in an other. The room to raise wages is there, but it doesn't mean it's not a competitive situation.
Where they sell is irrelevant. The point is that even in a competitive marketplace, corporations are making HUGE profits that used to be paid to workers. It is obviously possible for those profits to be paid out in wages to the workers instead of in dividends to the owners.
Heraclitusstudent
2015 Jan 5, 2:26pm
It is obviously possible for those profits to be paid out in wages to the workers instead of in dividends to the owners.
You're asking for the few companies that make huge profits, like Apple, to hire factory workers in the US with wages above market just because they can?
You mean... in an utopic world where people willingly abandon their own interests? Assuming Apple does, would it even make a dent on wages in the US? Probably not unless all companies do. Even more utopic.
Is that your definition of possible?
What about other barely profitable US manufacturers? Would they also be forced to pay more than market? Decided by who?
tatupu70
2015 Jan 5, 2:32pm
You're asking for the few companies that make huge profits, like Apple, to hire factory workers in the US with wages above market just because they can?
I'm not asking for anything--I'm simply pointing out that it is NOT the competitive marketplace that is forcing companies to do this. It is because owners want to maximize their profits at the expense of the workers.
I'm also not saying it's the companies responsibility to raise wages--just that it's NOT because they have to--it's because they want to.
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EWI Editorial
I am tired of hearing people insist that the Fed can expand credit all it wants. Sometimes an analogy clarifies a subject, so let’s try one.
It may sound crazy, but suppose the government were to decide that the health of the nation depends upon producing Jaguar automobiles and providing them to as many people as possible. To facilitate that goal, it begins operating Jaguar plants all over the country, subsidizing production with tax money. To everyone’s delight, it offers these luxury cars for sale at 50 percent off the old price. People flock to the showrooms and buy. Later, sales slow down, so the government cuts the price in half again. More people rush in and buy…
http://www.globaldeflationnews.com/jaguar-inflation-a-laymans-explanation-of-government-intervention/