The class struggle is who gets how much of output, or how much of per-capita output the median wage can buy.
If the ratio of per-capita output/median wage increases, then you have benefitted high earners and rentiers. If the ratio decreases, you have benefited "the average" worker. Just as employers cut labor hours to protect their financial holdings, so workers do not spend to increase their financial holdings. One wants to push the price of labor down, and the other wants to push the price of output down.
If the government steps in and purchases unwanted labor at a low support price, but purchases unwanted output at the market price, then it is systematically benefiting one side over the other. And it does not matter whether government is purchasing the output directly or via a benefit payment to labor. Unless 100% of government funded purchases result in wage boosts, you are still allowing capital to sell inventory to workers at prices higher than their wages allow, and end up anchoring median wages at a lower level in relation to output. As you continue this policy, the result is that the average wage can purchase less and less output, and the cost of living for the average worker increases, even though the price level need not. A slave society can have full employment and output.
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The header photo is a Creative Commons image (but was published in 1906, so it should be in the public domain).
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The Old Barkeep hails from Phoenix and lives in San Francisco, where he can keep an eye on things. This blog is his public notepad.
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