Sunday, July 15, 2007

High Middle Class Standard of Living Causes Wage Stagnation

The American middle class enjoyed a significant improvement in its standard of living during the 1980s and 90s. But, it was too much.

There has always been an acceptable standard of living for the middle class. A middle class family should be barely able to feed, clothe, and educate itself, as well as providing for shelter and medical care. Whenever the middle class standard of living gets higher than this acceptable standard, wages stagnate until the middle class is brought back to its proper standard of living.

There were two primary reasons for a rising standard of living; the computer age and the rise of the two earner family. Now two earner families are necesary. Due to two incomes, middle class parents were able to add luxuries, such as travel and technology, to the acceptable standard of living. Wage payers have never been willing to provide their workers with luxuries.

So, wage payers now keep wage increases below inflation. When wages and inflation balance in the acceptable middle class standard of living again, wages will finally start increasing. Hopefully, the middle class will not slip too far below the acceptable standard of living.


RockStories said...

On what do you basis the level at which the middle class "should" be living?

GreyTheory said...

The basic acceptable standard of living has been a level which will prevent widespread strikes. Basically, although struggling, the ability to feed, cloth, shelter, educate, and provide healthcare for your children.

When children are ill, poorly fed, or without shelter, workers are willing to strike, interupting corporate profits.

Anonymous said...

This post smells like batshit to me, honestly. Where are you getting the notion that middle class families should be "barely able" to provide for themselves?