THE ECONOMIC PICTURE….Great economy we have going here:
Productivity rose by 4.7 percent in the non-farm business sector of the economy from July to September….Real hourly compensation, which adjusts wages and other benefits for inflation, fell 1.4 percent.
This isn’t really a surprise. As near as anyone can tell, productivity appears to be primarily a result of technology advances, and neither Democrats nor Republicans have very much to say about that. Compensation, on the other hand, is primarily a function of how tight the labor market is, and Republicans have long done the business community’s bidding by pursuing policies that keep the labor market slack. Democrats, by contrast, generally try to pursue full employment policies.
So if productivity is skyrocketing, but labor compensation is going down, where’s all that extra money going? Yes, you in the back? Bingo: it’s going to the class of people who are willing to turn around and tithe a portion of it back to the GOP and its allies in election years.
Nice racket, isn’t it?