You can't help soften the blow of inflation by giving people more money! That will just cause more inflation and make everything worse!

We've all heard it a thousand times, giving normal working class people, especially poor people, more money will only make everything worse by causing more inflation. Somehow this will leave the majority worse off than if nothing had been done.

This is considered common sense among liberal-conservatives but as leftists we instinctively know that it is bullshit. Maybe higher wages and benefits would increase inflation but the net total is that the working class would be better off than before.

Instinct is not a very convincing argument though so how do you argue the case against the wage inflation spiral to liberal-conservatives?

  • RION [she/her]
    ·
    2 years ago

    From this article:

    Even under a worst-case inflation scenario where every penny in extra pay that results from moving the federal minimum wage to $15 by 2027 is passed on in the form of higher prices, the result would be a five-year stretch of inflationary pressure equal to 0.1% per year (or about 1/100th of the increase we’ve seen since 2021), then the inflationary effect would return to zero.

    Also, if increasing the minimum wage caused inflation such that the original increase would be eclipsed by increasing prices, why would the minimum wage ever be raised? But it has, a bunch of times.