I think this thread pretty much speaks for itself.
Jason and Cambria, for some bizzare reason, have tried to mislead people as to what I said on the last thread.
They are charging about saying that I want to force up pay rates in a recession. Like they are implying that I wanted the government to force up wages. Or to get the unions to force up wages. When the whole thread is about falling nominal wages.
This is an important issue because people correctly note that GDP equals national income. And they correctly note that if you reduced consumer spending and government spending therefore GDP would fall and therefore national income would fall. Hence wages would have to fall if everyone were to remain employed in the situation where Gross domestic revenue sayed flat.
Well this is all true. But if Gross Domestic revenue was flat and all these things happened, consumer prices would fall far faster than nominal wages. They would both fall but consumer prices would fall much faster. Hence it is in the natural way of things for our real incomes to grow even as our nominal incomes would be falling.
“Bird’s an idiot.
Raising nominal wages in a recession with downwards tending prices is lethal to the economy.”
So far neither of these two have backed away from this lie that I claimed we ought to try and push up nominal wages in a recession. Truly these people are bizzare.