Take physic, pomp

Argentina: Critics tend to forget how salary increases compare with high inflation…

…because if their petticoats slip and they mention the subject, dirty little secrets are let out. The following from Hernan Pablo’s incisive Argentina econoblog, Hache as it considers the period of 2001 (the financial crisis moment) to the beginning of 2014 in Argentina’s macro economy, considering private sector salaries:

“…from 2001, real salaries increased by 1,205%, while inflation increased by 920%. In other words, if somebody earned ArgP$1,000 they now earn ArgP$13,050, while goods that cost ArgP$100 now cost ArgP$1,020.”

Yes folks, you just read that right, no typos there: People in Argentina are better off now in real terms than they were before the high inflation environment kicked in. Go read all the note, plenty more food for thought there. This is the dirty little secret of econo-pseuds that jump to conclusions about high inflation economies, because if salaries keep up or even (in the case of Argentina) outstrip the rate of inflation, buying power of your average citizen is either unaffected or improves.
Here’s another example to think about. Who would you rather be?
1) Avg Joe bluecollar in USA, receives average pay increase of 2% per annum in an average 3.5% per annum inflation environment.
2) Avg José azulcollar in Argentina, receives average pay increase of 28% per annum in an average 25% per annum inflation environment.
Don’t think about it too long now, willyaz? And before you jump to conclusions about the dataset used by Hernan, the quoted 920% total inflation figure isn’t the official State beancouter INDEC version which is rightly considered a tissue of lies; that’s the parallel IPC version, the one that’s used to whack into INDEC by government opposition parties and the country’s constantly hostile mass media. Also drole is how Hernan is picking up on an article in anti-CFK newspaper La Nación and using its figures verbatim, a report that was designed to criticize the sitting administration.

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