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Commodities inflation hits the poor more. They pay more on things like food and gas which have commodities predominantly as inputs. The richer people buy more
by lamontcg 4y ago
Commodities inflation hits the poor more. They pay more on things like food and gas which have commodities predominantly as inputs. The richer people buy more stuff which has higher labor inputs.
At the same time though long-term commodities inflation is cyclical, while wage inflation tends to be sticky. If wage inflation actually causes raises in wages for working class people and isn't just contained to SWEs then long-term this is likely beneficial and would lower disparity in the long run. But this would take a decade of wage-price inflation. Short term it is a regressive tax.
But the Fed is trying to go back to the conditions of the past 40 years where wage inflation has been capped at around 2% which will just squeeze the lower classes even more.
- wahnfrieden 4y agoRight, I'm talking within the context of american policy. The fed wages class warfare, pardon the stale terminology, for the sake of the economy