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MmeGigs -> RE: Why is it everyone knows the solution to economic problems? (11/30/2008 7:02:42 AM)
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ORIGINAL: celticlord2112
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How about living wages and reasonable prices?
Both of these are fictional and have no basis or bearing on economic reality.
I don't think that you have much of an understanding of economic reality. You appear to be rather long on theory and short on practicality. Seems to me that the very epicenter of economic reality is reasonable prices - figuring out what it costs to produce what you're selling and charging an amount that will cover your costs, provide a profit, and that customers will be willing to pay. How is that "fictional"? Isn't that what the market is all about?
The living wage - the amount of money it costs a person to pay for basic necessities - is pretty much central to economic reality. Right now we're using all kinds of government supports to achieve it for most of our workforce. That's what the Earned Income Credit and assistance programs for working people are all about. We tend to look at these things as handouts to poor folks, but they're actually indirect subsidies to business, allowing them to continue to pay less than the actual cost of labor.
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A free-market (i.e., working/functional) economic system
You forgot a key descriptor there - sustainable. In order for any economic system to be considered successful it has to be working and functional over the long term. Keeping prices low by paying your workforce less than a living wage is not sustainable. As you said in a post some threads ago, "labor" is (are?) human beings. People who don't have enough money to pay for food, shelter, clothes, transportation to and from work and such, or who have to work two or three jobs in order to get enough money are not going to be an efficient and productive work force. They're also not going to be very effective consumers.
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