>The rate of real wage increase is still positive, though more like 2%
>than last year's 3%. He's been talking about the diminishing pool of
>available workers for at least a year and a half now. He knows that
>if the unemployment rate hugs 4% for much longer, there's going to be
>a lot more of this stuff.
What stuff! Continuing declines in the rate at which real wages are increasing!! The best way to get the increase in the real wage at 1% (aside from admitting how much inflation has been downplayed) would be to push the unemployment rate down to 3%. Seriously! Perhaps the good news will push potential immigrants over the hump; the forbidding news will force capital to speed up its ability to relocate. The paradox of a declining official unemployment rate will be a further increase in the supply of available labor power and greater competition in the labor market. It's a new economy after all.
> He's paid to do the long-range thinking for
>capital, after all.
They can think (maybe) but they can't plan. There is a fine essay by
Gabriel Kolko in Science and Society from 1979 on the myth of the long term
intelligence of the ruling class. In one of Poulantzas' most interesting
chapters "The Myth of the Moloch State" in *State, Power and Socialism* he
argues that the capitalist state's inability to enter into the hard core of
the relations of production make long term planning impossible, reducing
the state to ad hoc responses to crises the source of which it dimly
understands.
>
>>It is easier for Greenspan to do this in the idiom of fighting wage led
>>inflation than to openly admit that he is trying to ward off the greatest
>>equity crash in history, which will bring the world economy down with it.
>
>
>Why didn't 1987's crash do that?
Because Japan had liquidity then?!
Rakesh