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>Governments etc. argue As they should. that's how it works and they are correct. Employees should argue against that and demand more if they dare. The job o

• ClumsyPilot 3y ago
  > Central bank is to increase interest rates until unemployment rate increases I might be old fashioned, but last time I checked, government's job was not to drive down living standards. Maybe their job is to ensure that a resource-show like rising energy prices does not hit, by majing economy rsillient and relying on diverse suppliers
  • redeeman 3y ago
    > I might be old fashioned, but last time I checked, government's job was not to drive down living standards. thats because you have been reading the government marketing materials instead of looking at what they do
  • dghlsakjg 3y ago
    They didn't say government. They said Central Banks, which in most places are semi-disconnected from elected government since you don't really want anyone playing politics with Central Bank policy. Central Banks are generally tasked with setting one single, but very powerful, variable: interest rates. There's thought to be a pretty strong causal relationship between interest rates and unemployment. The central bank absolutely knows that jacking up interest rates will, in the short term, drive down living standards. The trade-off is that it will also drive down inflation, which causes much bigger drops in living standards in the long term. ... Or so the theory goes.
    • revelio 3y ago
      In practice central bankers are unelected politicians. Their mandates are set by politicians, they aren't actually bankers in the normal sense of the term, and what they do is attempt to plan the economy in service of politically set goals. If central bankers were really independent of politics then they would of course have refused to print any money to fund COVID measures like lockdowns on the grounds that they are responsible solely for inflation and employment, so if governments wanted to do that they'd have to pass emergency taxes. Obviously no central banker said that. They were all immediately on board with letting politicians do whatever they wanted.
      • nabla9 3y ago
        > Their mandates are set by politicians. You say as it's a bad thing. The mandate is public and set by politicians selected by people. This "it's all bad" because politics stuff is jut nihilism.
        • revelio 3y ago
          I didn't intend for it to be read as either good or bad. Actually I think it's a good thing. Government employees should not see themselves as independent of politicians.
  • nabla9 3y ago
    You can get 100% employment only if wages are too small. That's really bad for living standards. There is so called "Natural level of unemployment" and NAIRU (Non Accelerating Inflation Rate of Unemployment) typically between 3% and 5%.
• bumby 3y ago
  I think the OP was referring to how governments tend to be conciliatory to actors just responding to market forces in one side of the debate and not the other. Jon Stewart had a good interview with Larry Summers on this (although I realize he’s no longer in the government). Stewart’s point was that the govt/central bank tends to make excuses for letting corporations benefit from “market forces” but do more to actively thwart workers for using those same forces to their own benefit.
• JumpCrisscross 3y ago
  > job of Central bank is to increase interest rates until unemployment rate increases This is incorrect. The job of the Fed is to maximise price stability (which it defines as 2% inflation) and minimise unemployment (which it defines as the natural unemployment rate, to which we are close). There has basically never been a time when the Fed wanted unemployment to go up. (Keep in mind: unemployment != wage increases, though the two are related as are prices.)