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May 12, 2017


Peter K.

I understand the point of the blog post and share you view about the BBC and corporate media. But I don't have a firm grasp of the macro situation in the UK. If there is labor market slack would more fiscal and/or monetary policy tighten up things?

About the U.S., Greg Ip wrote yesterday in the Wall Street Journal:

"Instead of worrying about robots destroying jobs, business leaders need to figure out how to use them more, especially in low-productivity sectors. Someday robots may replace truck drivers, but it's much more urgent to make existing drivers, who are in short supply, more efficient. Clean energy advocates boast about how many people work in solar power when they should be trying to reduce the labor, and thus cost, involved.

The alternative is a tightening labor market that forces companies to pay ever higher wages that must be passed on as inflation, which usually ends with recession."

A tightening labor market should provide workers with more bargaining power so that workers share in productivity gains instead of it all going to capital.

If there is too much inflation, the central bank will raise rates too much too fast which will cause a recession and throw people out of work. Yellen is trying to kill jobs now by rationing demand/credit and raising rates.


Or just comfortable old guard lacking incentive to keep up?

Gerard MacDonell

I love the concept of emergence, which is new to me, to my shame. I read about it in The Big Picture, by Sean Carroll.

From my novice perch, I want to say that emergence opposes essentialism, perhaps along the misplaced focus on specific events that you identify.

People -- including macro economists -- love to identify an essence, which may or may not refer to anything existing in the actual world, and then to agonize about how to apply it.

A simple example of people being confused by this bad habit is the debate over "monetization." Is this or that policy initiative "monetization" or not?

Who fracking cares? Just focus on the likely effect of what was actually done or proposed. Almost the entire discussion of h money, for example, can be set aside by insisting that an essence need not be an actual thing, you know.

derrida derider

Its absolutely true that politicians (for government) and CEOs (for business) and generals (for war) matter far less than people think they do - least of all as much as they themselves think they do. And that this belief leads to undue respect for authority at all levels.

But I aint ready to go to the other extreme and think either individual human agency or blind luck doesn't matter at all. Do you really think wage stagnation in the UK would be as extreme since 2007 if certain individuals hadn't seen a chance to try and dismantle the welfare state to build a Britain fit for "people like us"? Or that a few strategists running a less incompetent and complacent "Yes" campaign would not have made the small necessary difference to the Brexit vote?


"First, real wages have stagnated ever since 2007 – long before Brexit was heard of."

I think that if you look at the ONS figures for real (using the BoE inflation calculator) median male weekly earnings, you'll find that they actually decreased between 1997 and 2015 - an 18 year period. So much for Blair and Brown.


Hours and earnings figures here


Inflation calc here


Median male weekly wage 1997 is £356.90, calculator says that would need to be £596.10 in 2016, actual median male wage 2016 is £577.80. Therefore median male worker was better off in 1997 - and I haven't even got on to rents and house prices.

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