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Workers have suffered worsening terms of trade, in which the prices of things they buy (i.e., consumer goods and services) have risen faster than the items they produce (consumer goods but also capital goods). Thus, if workers consumed microprocessors and machine tools as well as groceries, their real wage growth would have been better and more in line with productivity growth.
—Lawrence Mishel, The Wedges Between Productivity and Median Compensation Growth, www.epi.org, April 26, 2012.
Dr. Mishel is the liberal conservatives love to hate.
Said conservatives are compelled to read the work he and his team at the Economic Policy Institute generate because it goes deeper … further.
Further, or how far we have regrettably come, is distilled here as Mishel destroys the cautious mythology of our national productivity.
Exactly when does technological progress touch the three-quarters of these states-united lost in an education dust bowl?
Even worse, tag team Mishel’s “wedges” with this profound, short, and terse must-read from Booth’s Raghuram Rajan. (Thank you, B. Ritholtz of The Big Picture for a massive heads-up on Mishel and our nation’s wedge.)
It is time to get serious. Read Rajan; read Mishel. Buy a Summit V Series Vertical Mill, all 2,200 pounds, and consider the potential of America. Discuss.