Re(3): RE: Wages and Panic Buttons

Fabian Balardini balardini at
Thu Aug 5 15:06:27 PDT 1999

Everybody on this thread seems to agree that inflation is the result of the fight between capital and labor so I have a couple of questions:

1) if inflation is the result of unions vs capitalists intitutions fighting for a larger piece of the pie this implies that unions can be as strong and stronger that these capitalist institutions on the aggregate so then why they don't just overthrow the whole system altogether!!!!???? (and don't tell me that "well this is not as easy as it sounds, my son" because if you are arguing the above about inflation you are making the fantastic argument that individual capitals continue hiring workers over an extended period of time although their productivity remains below their wage so that they are force to increase prices without worrying about competition with other capitals creating an inflationary spiral. This is in complete contradiction to everybody's well known story of the reserve army of labor in Marx, so we should ask where does this theory largely adopted by leftists really originates. I would also like to remind you that Kalecki althought he was a comunist had a price theory based on neoclassical imperfect competition.)

2) if inflation is the result of the fight between labor and capital (which implicitly in every version of this theory is that unions are stronger than capital for sustained periods of time putting enough pressure on costs to make capital increase the mark ups so you get inflation) how do you explain the Argentinian, Bolivian, Brazilian and other latin american nations inflations during the 70-80's when all labor institutions were destroyed???????

Angelfire for your free web-based e-mail.

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