A colleague keeps sending me articles about the dangers of inflation, including this op-ed today by Larry Summers. What's a good way to refute the argument Summers is laying out. I don't really know econ/finance stuff particularly well.
A colleague keeps sending me articles about the dangers of inflation, including this op-ed today by Larry Summers. What's a good way to refute the argument Summers is laying out. I don't really know econ/finance stuff particularly well.
I think we agree here, then. Of course the labour value and use value doesn't change, only the price, hence inflation.
I think you should read the whole pamphlet. Price doesn't mean anything and fighting for higher wages when they've been supressed for so long is just fighting for the old value of your labor and not something that will cause a negative rate of profit.
So there's the thing. In value terms, there is paid labour, there is surplus value, and there is land labour.
If you increase the value term of wages, you will decrease surplus value. That means that the profit rate will fall.
Labour previously did not buy any more commodities as it does now. On average they stayed the same for decades, that is, in the US.
What did become more expensive are things such as housing prices, education, healthcare, and public services decreased.
Because of this increasing wages at least in the US of everyone across the board will reduce the profit rate, if it doesn't then it will cause inflation, ie, not increase at all in value terms.
The value term of labour in the US in commodities didn't decrease, it just stopped increasing while rent seeking increased and consumed more of that outside of the relationships of production.