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Tuesday, August 07, 2018

Wages up

The Chamber of Commerce's worst nightmare is coming true.

Corporations are having to pay American workers American wages.

The Wall Street Journal reported, "U.S. workers received their biggest pay increases in nearly a decade over the 12 months through June, a sign the strong labor market is boosting wages as employers compete for scarcer workers.

"The Labor Department’s employment-cost index rose 2.8% in the year to June compared, the government said Tuesday. Wages and salaries, which account for about 70% of all employment costs, also rose 2.8% from a year earlier, the strongest gain for both measures since September 2008."

The strongest gain in a decade.

Another Obama legacy is dashed: stagnant wages.

Oh, the Journal immediately stoked inflation fear, reporting, "The wage gains suggest the steady drumbeat of rising inflation continues. What's more, a separate report from the Commerce Department Tuesday showed the price index for personal consumption expenditures, the Federal Reserve's preferred inflation measure, was up 2.2% in June from a year earlier and rose 0.1% from May. Excluding volatile food and energy costs, prices also rose 0.1% in June, and increased 1.9% from a year earlier."

Inflation is up 1.9% excluding energy and food, while wages rose 2.8%. That means American workers actually are coming out ahead for the first time in decades.

Inflation averaged 3.4% annually under Reagan. Actually, the deflation of 2008 and 2009 were the real problem. The collapse of the housing market wiped out years of the build-up of equity.

President Trump has upended cheap labor for the Chamber of Commerce by going after illegal aliens, and by imposing tariffs that make it more expensive to ship jobs overseas. The Tax Cuts and Jobs Act of 2017 has pushed unemployment below 4%. Unable to exploit illegal aliens, businesses have to pony up higher wages.

I'm happily retired but it does me good to see American workers enjoying more of the benefits of their labor. I like capitalism. I like free trade. Give the American worker a fair and fighting chance, and he will kick the world's butt.

We did it before. We'll do it again.

And if that gives the Chamber of Commerce the sadz, so much the better.

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11 comments:

  1. Starving the CoC will inhibit their ability to purchase RINO's. My own future senator, Romney will be out on the ice floe with Will and Kristol shouting at those of us on land.

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  2. And once again, expect zero coverage from the drive-bys. Null, nada, zip. If the Black Jesus had accomplished such a thing, it would lead. Bias in the media? The HELL you say!

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    1. Lead? My God, they'd be shouting it from the rooftops 24/7. The Dallas Cowboy cheerleaders would be shamed with the cheerleading the MSM would be doing.

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  3. Watch for increased family formation out of this. Something the big business guys don't want to see. One reason big business has bought into the idea of the atomized human and promotion of so-called alternative lifestyles is that unrooted people don't cause them trouble when they become unhappy. They just move on to the next short term gig, the next short term relationship.

    People with families, on the other hand, tend to put down roots. They buy homes. They form communities. And when they are unhappy they confront those responsible for their unhappiness, rather than simply moving on.

    This is a big reason for people on the right to favor breaking up big oligopolies and monopolies. Smaller businesses tend to mirror the aspirations of families.

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  4. The Chamber of Commerce is upset because their members have to pay their employees more because the market tells them to. They have no problem with the government telling them what they have to pay, oddly enough.

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    Replies
    1. This is more of the big business problem. Higher minimum wages are a barrier to entry for new, smaller businesses. The more entrenched, older, bigger business has less to worry about. They already have the government thing with a bit in its mouth and their hands on the reins, markets are outside their control. Markets are something they learn about in school. They hate markets.

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    2. Exactly. Antitrust laws were intended to guarantee access to markets and prevent monopolies and oligopolies, but soon the government discovered it would be easier to control a few big businesses than a lot of smaller ones. So, they allowed big companies to force the smaller ones out of business in exchange for what passes for regulatory control. That's how we end up with three airlines and four banks...

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  5. It is more like the Cespool of Commerce. I dispise this organization.

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  6. Wasn't the Fed under Obama to achieve 2% inflation? Didn't they say that would be the sign of a healthy economy?

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  7. The Chamber of Commerce would be delighted with open borders and the elimination of ICE. Boy how things have changed.

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  8. The Chamber of Commererce still exist?
    After they lost all credibility last year and joined the socialist movement, I thought they were in training in Siberia. They have been pretty quiet in their humiliation for some time. I wonder how it feels to be wrong so often, I don't really care but maybe the COC could write us a sad tale about their experience.

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