> I'm only going to comment on this point. Erik: Recently, the wages of
> workers has been rising. However, over the last couple of decades, if you
> exclude other forms of income and wealth, the inflation-adjusted incomes of
> workers with few skills has indeed been stagnant. Is that the fault of the
> market? I would say no. Why?
Taxes have skyrocketed.
The majority of inflation is in those industries most affected by
government intervention, e.g. medicine and post-high-school
education. Since these industries are generally seen as not being a
major part of day-to-day life, people willingly accept wage increases
that match inflation in the *rest* of the economy.
The demand for "workers with few skills" is declining.
> Today's economy increasingly rewards those with skills, especially
> "symbolic" skills such as computer programming, language skills, legal
> expertise, etc. While, in the USA, less skilled workers have made no
> progress over a couple of decades, at least they are employed. In European
> countries, the very same factors are at work, but the result is high and
> persistent unemployment.
That's to be expected. If the demand for unskilled workers is
declining relative to the supply, the natural wages of unskilled
workers will (not may, not might, not could possibly -- WILL) fall.
There are three ways this can be expressed: (1) spreading
a reduced total wage over a similar number of workers, giving each
one lower wages; (2) keep the wage of each employed worker up, but
lay off a bunch of workers; (3) use armed force to transfer some
wealth to the pool available for unskilled workers, keeping their
wages and numbers up simultaneously -- by decreasing the wages, or
the number, of better-paid workers.
Minimum-wage laws, of course, prohibit option (1) from going beyond a
certain point.
> In our case, I would argue that the fault is not the market. Partly it may
> be an inevitable result of differences among humans and their abilities and
> culturally-influenced preferences (such that some refuse to learn the
> necessary skills). But much of it I would say results from a poor
> educational system that is weak at motivating students, lacks innovation,
> and fails to instill important skills. (I *know* this goes on because I
> teach students entering college who almost all lack logical skills, basic
> math, and any semblance of scientific education.)
That too. Increasing the supply of unskilled workers at the same
time that the demand for them is decreasing, doesn't seem the most
sensible action.
Not to worry, though -- friends and acquaintances who hire unskilled
workers, report that a high percentage of recent high-school
graduates don't even deserve to be called "workers". They are so
unprepared for the reality of the workplace that they will need a
substantial amount of remedial education before they are prepared to
matriculate at Hamburger University.
(Start with the day a manager at a local burger joint had two
interviews scheduled, both for 9 AM, and a new employee supposed to
start at the same time. Was she overbooking her time? Not to worry.
Of the three, only one showed up. One of the people to be
interviewed. Fifteen minutes late. The manager, from experience,
EXPECTED only one person to show up.)
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