The supply and demand of wage growth

Soon to be Melbourne. Source.

A comment on last week’s hawt chicks & links from a reader with an unpronounceable name:

“In a world where we continue to experience labor shortages I might agree with Carlson, but the future we face indicates millions of jobs erased by automation.”

Worker salaries around the West have in general seen much stagnation over the past few decades. But this has not been caused by automation. Rather, it is down to a combination of bad trading policy that has destroyed manufacturing as a base as well as wholesale immigration. The laws of supply and demand are real bitches when it comes to this sort of thing.

An example that I find illustrative is what occurred in the Netherlands after the Second World War. With large parts of the country devastated and the economy moribund, hundreds of thousands of Dutch emigrated to countries like Australia in search of work. Then the economic boom of the 60s occurred and suddenly there were not enough workers to go around. Because of this, wages increased. Businesses didn’t like having to pay all these wages to the suddenly uppity lower classes so they lobbied the government to bring in thousands of immigrants from countries like Turkey.

Their excuse was that suddenly the Dutch did not want to work jobs that were beneath them such as cleaning toilets or sweeping the streets. The real reason was that in an ultra-competitive job market in order to attract people to do those jobs the wages would have to be increased to a level that businesses did not want to pay.

Not that they couldn’t pay; they just did not want to.

So hordes of immigrants from incompatible cultures were brought to Holland to do the jobs that no sane Dutchman wanted to do. Apart from the social upheavals associated with such a decision, the other major consequence was the effect that this had on wages. Wage growth plateaued as competition for new employees fell. The same thing has happened in many other countries around the world.

(Note; I haven’t even mentioned the effect that welfare had on this but keep in mind that there are many other factors at play as well.)

The conservative party in Australia won the recent unwinnable election partly because the working class has had enough of seeing wages driven down by the political classes’ fixation with whole scale immigration. For the political class, immigration is crack cocaine; once they get a taste they just cannot stop. Here in the USA the two sides of politics are currently arguing over which types of immigrants should come in. The Republicans want some standards while the Democrats scream that this is racist and we must bring in absolutely anyone with a pulse.

But nobody that counts is raising the point about why we need any immigration at all. It’s simply taken for granted that we must bring in more and more people, no matter that the present infrastructure is close to collapsing under the weight of numbers that it simply was not designed for. Whether that be roads, schools, hospitals, or airports, our countries already have far too many people. What possible benefit could bringing in more people have?

Well, it could continue the trend of keeping wages down. If you keep wages down and inflation continues its merry trend then eventually the proles will be ripe for manipulation into a 1917-style revolution. The thing that socialists hate above all else is any upward mobility of the lower and middle classes. If people are doing well then they can’t be tricked into socialist revolutions. Everything that the left has done over the past 50 years has been carried out with this aim in mind. Climate change is simply the latest version – beggar the populace with climate taxes until they’re happy to rise up in the streets for the glorious revolution, comrades.

Here in the USA the job market is going gangbusters for the simple fact that Trump is fixing the trade imbalance side of the problem. Almost every business that I drive past or walk into in Louisiana has a sign up stating that they’re hiring. I’ve never seen anything like it. And as a result wages are going up for the first time in years. But imagine what the effect would be if there weren’t 22 million illegal immigrants in the country? And imagine the effect if legal immigration was not anywhere close to the present numbers? Why, wages would be off the charts. Comrades.

This is why cries about the dangers of losing worker jobs to automation are feeble cries in the wilderness. Fix the immigration addiction and we won’t have any problems with job losses for generations to come. Nothing exists in isolation and our present economic circumstances are a creation of 50 years of careful manipulation with one end goal in mind.

This is why they hate Trump so much. Trump has shown that it can be undone, and easily so once you get the ball rolling. All we need to do is to progress to the next step and stick the hardcore socialists up against a wall.

This article was originally published at, where Adam Piggott publishes regularly and brilliantly. You can purchase Adam’s books here.