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Try checking reality, Spuddo!

The result is that his company has, by forcing a below inflation pay rise on its workers, but by imposing inflation level price increases on its customers, seriously increased its profits, and so the well-being of those who share them (the shareholders) at cost to its workforce.

In response you will hear all sorts of excuses. These will include things like ‘but pension funds own shares, so this benefits the workers after all’ and ‘but it’s not a lot’ and that those complaining are ‘engaged in class warfare’. But those claims are nonsense.

Pensions funds used to own a lot of shares, but don’t nearly so much these days. And who cares if ‘it’s not a lot’ when it means workers get 5% and shareholders get 20%? Pointing that out is not ‘class warfare’: it is commenting on what’s happening.

As the potato says, economies must add up. If this is happening then and therefore the labour share of GDP must be falling.

The UK labour share of income was 59.8% in Quarter 4 2021, compared with an average of 59.0% pre-coronavirus; on a calendar year basis, the labour share of income ticked up for the fifth consecutive year to reach 60.0%.


11 thoughts on “Try checking reality, Spuddo!”

  1. Richard Murphy says:
    July 29 2022 at 12:15 pm
    You are not using real world data

    PPI is not consistently 24% for a start

    Politely, you’re making the data up

    I am just offering an example


  2. Another blogger suggested I should learn more about Liz Truss. Wickedpaedia says this: “… she qualified as a Chartered Management Accountant”

    Could she outspud The O’Spud?

  3. Bloke in North Dorset

    Whenever I thought I was worth more than I was being paid I started looking around the job market for either more money or a more interesting job.

  4. Why do ecomomies have to add up?

    Does it irk, trusting government statisticians who ignore error terms and error propagation, and impute (i.e., make up) half of GDP anyway? Or is our blogger just using rhetoric, and he really knows GDP is purely performative: it takes on a meaning independent of reality, as a kind of mass-halucinated magical number?

    If you put proper confidence intervals around GDP and labor surveys, then propagate those error terms through the calculation to get share of GDP or whatnot, can you tell any story you feel like?

  5. rsm
    Because in this case, we are talking about given entities’ share in the whole. If one group gets XX% another group gets YY% then the last group must get “(100 – XX – YY)%. That’s a tautology.
    For the rest of your dribble, I suspect you are the first human to fail the Turing Test.

  6. dcardno

    If you include standard error, is your XX% really XX% plus-or-minus 10%, or 50%, or greater?

    Thus, doesn’t “(100 – XX – YY)%” yield a range that is so wide, any interpretation is warranted by the data?

  7. rsm – no: you can observe that the data is weak, and not use it, or caution that the conclusions are not strong, but once you use the data there is no other way to interpret it, wide error ranges or not.

  8. rsm (not banned, apparently)
    Of course not – but what you aren’t allowed to do is say “piece A is 1.0m ± 0.02m long, and piece B is 1.01m ± 0.2m long, therefore Piece B is longer” – and that’s what ‘any interpretation is warranted by the data’ is doing.
    You can make any assertion you like; you just can’t argue that it came from the data. Instead, you have to argue that the data does not support any conclusion

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