Productivity and Wages

The Associated Press had an article today titled 'Productivity Slows, Wages Post Increase' which aroused my ire by its wording:

Productivity is the key factor determining rising living standards. Strong growth in output allows businesses to pay their workers more without having to raise the cost of their products, which fuels inflation. But the current numbers raise concerns because they show wage pressures rising as productivity growth slows.

Productivity growth, which had been weak for two decades, began to rebound in the mid-1990s, reflecting the benefits produced by the spread of computers in the workforce.

What is wrong with that?
Economists act like Wages are almost an Enemy, which can only be countered by increases in Productivity. A real Truth would state that a concentration on Productivity leads to Labor exhaustion and Labor burnout, brings too critical managerial evaluation of Labor cadres, and is the wellspring of Downsizing, Layoffs, and Offshoring. Another Truth states Wages are responsive to Standard of Living conditions, not vice versa, with Wage demands developing pressure only under increased Living Costs. Robert J. Shiller has an article in which he describes the difference in Chinese and American prospective on Savings. It stands as obvious that while Chinese labor has less Consumer Products which they can buy, it cannot be the sole reason their Savings rate is so much higher. Chinese labor must receive a greater percentage of their actual Productivity than do American laborers. The real wellspring of Productivity is in the form of Business Profits, which may seem only to rise at the same relative rate as Wages, but devolves upon a much smaller economic class.

Don Bondreaux has an article which described a BLS report put out recently. Two important Quotes:

It's important to note that throughout the 20th century, the share of the average household's income spent on non-essential items increased steadily, although noticeably slowing down between 1984-1985 and 2002-2003.

It's surprising that average household annual expenditures changed its trajectory in the mid-1970s from one of rather modest decadal increases before then to much more dramatic increases since then. (It's true that these data are in nominal dollars, but the continuing hefty increases in household annual expenditures post-1975 seem not much muted by the collapse of inflation rates from the mid-1980s on.)

This records the fact cultural aspersions devoloped raising nonessential Consumer products to the level of Necessities. This raised real Living Costs. The Report, itself, details the porportion of Living Costs devoted to different sectors all rose along with Wages and Prices, but did not vary significantly in percentage of total Income. The sum total results in a Spector when the real percentage of Wage Income to Total Income has actually dropped over the Century. Conservatives make much of the fact so many own their own homes, but it is also true that the greatest majority hold the greatest amount of their equity in their homes. This ends with the necessity of lower Incomes gouging each other (because of real value of their Housing) to obtain any advance in their equity, and still requiring an alternate form of housing. lgl