I’ve been wondering this question for a while. Ignoring current events, why is a little bit of inflation desirable?
I do understand that it’s done to “stimulate” the economy so people don’t let their cash rot in a checking account, but isn’t it a zero-sum game? Everybody says that money is not meant to stay where it is, rather, should flow through the economy. But if the economy always needs injections of liquidity because otherwise it fails, isn’t the economy broken?
I feel like there’s something I can’t comprehend about that.
Let me add: I’m an engineer. By reason of existence, my work involves improving how we do stuff. My work involves helping people work more efficiently, use fewer resources, cost less etc. We should be doing more, with less because the tools and methods get better. So why do things keep getting more expensive? I don’t grok inflation. Not a bit of it.
Theoretically wages should be getting bigger to at least keep up with inflation (due to improving technology and the like they should be beating it), but in practice capitalist greed means it doesn’t always work that way.
The right way to look at how expensive things are is to normalize prices to other things that also change with time, for example wages and expectations.
A car may be more expensive now than in 1960, but the car is faster, safer, more comfortable, and more people have one now.
Same with many improvements- an iPhone today is more expensive than a Nokia 3210 was in 2000, but it has more features and more people have one.
It is against human nature to stay where we are and just use improvements to reduce the amount of work we need to do. We want to have more. That may be a bad thing for sustainability, but we typically expect our governments to support that kind of progress, hence the dual mandate of the central bank to maintain economic growth with a high level of employment and a low level of inflation.
To be clear though since the industrial revolution and until WWII improving technology has both improved quality of life and reduced working hours. The fact that working hours have stagnated at around 40/week is a historical exception that doesn’t get fully or even mostly explained by “we have more and better stuff;” if that was it we should be working 20 hour weeks by now. For more see David Graeber on the subject.
There is a lot of inequality that plays into this.
If you think about 90s Goldman Sachs style of 80-100 hours weeks, no weekends, no holidays culture that dictated “work ethic” expectations in American white collar jobs, to the post covid hybrid work and “quiet quitting” culture: I think the typical white collar worker works way fewer hours than 20-30 years ago, even though contracts said 40 hours the whole time. Anecdotally, a cushy office job at individual contributor level can be apparently kept while working maybe 1-2 hours a day. I know those are not typical, but it’s way more common than it used to. And my perception is that taking weekends and holidays off became normalized, and nobody is virtue signaling anymore that they worked the whole weekend, even if they did. People take their vacations.
Now that doesn’t mean the hours of hourly workers, healthcare workers, construction workers, service and restaurant industry workers, etc, are getting shorter, but as I said, that is more a social equality problem than anything about the economy or inflation rate specifically.
Okay you’re basically right that effective necessary (so discounting bullshit) white collar working hours are declining, but also you should really read the book I linked. It expands on what you said here on multiple levels, and I suspect you’ll find it somewhere between interesting and enlightening.
I’ll check it out!
But lots of things do get cheaper. You can buy a fucking miracle device like a smartphone for a weeks work. Everything you want gets cheaper, everything you need gets more expensive.
Can of coke cost a penny. Now it’s closer to a buck?
yes, because that’s how we have organized things.
we could make housing a commodity, but we have chosen not to do so. we have made it an investment. not every economy in the world works this way, or has, historically.
and generally we rampantly resist the idea of commodifying housing, education, healthcare, and other resources. but we’re OK doing it in other areas. these are largely political and social choices about what we perceive as having value and how that value should function and how those goods should be distributed.
I’m also an engineer, and in my experience a reduction of blue collar workers gives only a temporary reduction of the work force; soon enough there will be more cost controllers, HR business partners and officers for all kinds of non value adding stuff. In my country we’re at the point where the people with bizarre job descriptions on LinkedIn are always posting about how to effectively employ the work force.
Basically what you said, but as a book-length argument with evidence and other fancy stuff.
right, and what if you think this book is bullshit itself?
this concept that some jobs are ‘real’ and others are ‘fake’ is just class-confirmation bias that has no basis in economic reality. Sure you might think a teacher deserves to make 250K because their job is ‘real’ and a investment banker doesn’t deserve 2.5million, but the truth is people generally value the investment banker far more than the teacher and the 1000x pay is reflective of that, especially as the teacher doesn’t help them increase their own wealth.
forced pretense and bullshit is how most of the world works, this idea some there is some perfect world where you don’t have to pretend to care about nonsense to advance your career is delusional, there is no such world.
So clearly you’ve not read the book, which I mean fair enough but then at least try to understand what the argument is before disagreeing with it based on dogma. Here’s how it defines a bullshit job:
The idea being that the person actually doing the work is in the best position to tell if their work actually means something.
Good assertion, I hope you’re ready to defend it against…
The book is full of exciting testimonies like this. Which is to say, the assumption that bullshit jobs don’t exist is clearly false.
Investment bankers actually wouldn’t fit the definition in thr book anyway, but also hell no? Plenty of people want there to be more teachers in the world, or at least would consider that to ve a good thing out of hand. I struggle to think anyone ever thought the world needs more investment bankers. Besides, education is the best investment an average person can make by a long shot.
Just world fallacy. Just because something is normal doesn’t make it not bullshit, but also clearly a farmer or factory worker’s career doesn’t inherently involve pretending to care about nonsense. You should really read the book, if only to disagree with it in a more educated manner.
“other people’s jobs are bullshit, but not mine”
inherently contradicts “The idea being that the person actually doing the work is in the best position to tell if their work actually means something.”
The argument is bullshit itself. But this book isn’t trying to make a coherent argument, it’s trying to sell books by appearing to people’s resentment that their job is important and everyone else’s is stupid and worthless. Which pretty much everyone believes because we are all egotistically biased.
I don’t need to read the book. The ‘argument’ has been around forever in various forms. ‘bullshit’ jobs have always existed and will always exist, and are just a product of ignorance and idealism that the world would be ‘better’ without them. Everyone hates administrators and bureaucrats and support staff and thinks they shouldn’t have to exist and ‘get in the way’ of them doing ‘real work’.
You know what another bullshit job is? firefighting. last time I checked most firefighters aren’t putting out fires every hour of everyday they work…
You legitimately have no idea what you’re talking about and I’m starting you doubt you’re even reading my replies in full. Unless you’re willing to give me a point by point counterargument like a normal person, this conversation is over.