
High Wages versus High Savings in a Globalized World - mooreds
https://carnegieendowment.org/chinafinancialmarkets/75972
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downrightmike
You can only screw the working class so long before the lack of a middle class
will no longer prop up the economy and you can't recover. If the vast number
of people can no longer consume and you need them to, but they do not have the
resources after decades of being forced to save, because they never have
enough to consume and add back to the economy, the economy won't recover. And
this: "Germany’s Hartz reforms are the most obvious recent example, and I
think Germany in the 1930s is another. In the former case, after the labor
reforms, wage growth dropped significantly below GDP growth, driving down the
household share of GDP in exchange for an explosion in the share of business
profits." It makes it sound like the profits went to the workers not the
business, but that isn't logical.

