Deflation

…AND CHEAPER…:

Homes Today Vs. 1956 – What’s The Difference? (NICOLE MURRAY, 4/14/26, The Mortgage Note)

To start, American homes today are larger. Jeremy Horpedahl, an associate professor of economics at the University of Central Arkansas, recently told The Mortgage Note that new single-family homes are twice as big in terms of square footage compared to 1956.

“Believe it or not, it costs roughly the same per square foot,” Horpedahl said.

Beyond that, Horpedahl says it’s all about the amenities. For example, in 1956, only 50% of new homes were equipped with a garage. In 2024, 96% were. The percentage of homes with central air systems and appliances has dramatically increased as well.

Contra the Left/Right, our affluence is staggering.

…AND CHEAPER…:

Economists Once Dismissed the A.I. Job Threat, but Not Anymore (Ben Casselman, April 3, 2026, NY Times)

In a working paper published this week, a team of researchers surveyed economists about their outlook over the next five and 25 years. Most expect the economy to grow a bit more quickly as A.I. improves, but not to diverge substantially from historical patterns. If the technology improves rapidly — a possibility they consider unlikely but plausible — they envision a far more drastic scenario with faster growth but also greater inequality and the disappearance of millions of jobs.

“Economists are certainly taking A.I. seriously,” said Ezra Karger, an economist at the Federal Reserve Bank of Chicago who was one of the study’s authors.

IT’S IMPOSSIBLE TO OVERSTATE DEFLATIONARY PRESSURES:

Corporate Adviser Says the Ideal Number of Human Employees at a Company Is Zero (Joe Wilkins, Mar 8, 2026, futurism)

That, at least, seems to be the contention of Daniel Miessler, an outspoken cybersecurity engineer and AI booster. In a rambling post on his personal blog, Miessler takes the position that human workers are already obsolete, so the best thing we can do is accept it and fall in line with the AI revolution.

“My favorite way of capturing this: the ideal number of human employees inside of any company is zero,” he wrote. “That is the number that they’re trying to get to.”

He’s not just using hyperbole, he takes pains to clarify.

“When I say zero, I mean zero workers,” the AI wonk told Fortune in a followup interview. “As in factory [or] machine jobs. Like regular working people.”

…coupled with renewable energy.

…AND RICHER…:

Are Americans Getting Richer? (Washington Post Editorial Board, Feb 20, 2026)

The premise of the index is simple: how many hours do you need to work, compared to the month or year before, to be able to afford the “basket of goods,” which is a standard set of household items and services that comprise the Consumer Price Index used to calculate inflation.

The “time price” is how many hours of work it takes to purchase the basket of goods. The “abundance” is how much of the basket one hour of work can buy. The story told by the index is a very good one: since recordkeeping began, “abundance” for average private sector workers comes out to a net increase of 13.8 percent.

…AND CHEAPER…:

Your Fridge Is Bigger and Cheaper Today, Thanks to Global Trade and Innovation (Jeremy Horpedahl, 11/26/25, Cato)

In 1984, the average hourly earnings for production and nonsupervisory workers (representing about 80 percent of the private workforce) stood at roughly $8.32. Acquiring the Kenmore would thus require approximately 163 hours of labor, equivalent to more than three full workweeks.

By contrast, a comparable 2024 model from a major retailer like Home Depot—matching size and features—retailed for $998 in nominal terms in 2024, when I last checked it, a direct reduction without inflation adjustment. With average hourly earnings in 2024 at about $29.85 for the same worker category, the labor investment drops to around 33 hours. In relative terms, refrigerators have become nearly five times more affordable, reflecting efficiencies from global supply chains, automation, and competition.

Interestingly, that fridge has increased in price sharply since 2024, almost certainly in part because of trade policy, and is currently listed at $1,658—even so, it is still much cheaper when measured in time prices, requiring just 53 hours of labor, compared with 163 hours in 1984 (and you can probably find a Black Friday deal on it too).

NO ONE WILL MISS JOBS:

Middle managers fade as AI rises (Emily Peck, 7/07/25, Axios)

There are now nearly six individual contributors per manager at the 8,500 small businesses analyzed in a report by Gusto, which handles payroll for small and medium-sized employers. That’s up from a little over three in 2019.

“It’s happening broadly across the economy,” Nich Tremper, a senior economist at Gusto, told Axios.
For small companies, a lot of this happened through attrition, he says. “Rather than replacing a manager, an existing one will just see an expanded scope.”

The massive inefficient expansion of management was how white men integrated women and minorities into the workforce without giving up our own jobs.

CAPITALISM IS IN ITS INFANCY:

The AI Efficiency Trap: When Productivity Tools Create Perpetual Pressure (Knowledge Wharton, July 05, 2025, Fair Observer)

Three-quarters of surveyed workers were using AI in the workplace in 2024, but instead of experiencing liberation, many found themselves caught in an efficiency trap — a mechanism that only moves toward ever higher performance standards.

Imagine thinking that creating wealth ever more cheaply is a problem?

INFLATION IS A FUNCTION OF WAGES:

US wage patterns during and after the pandemic: Insights from a novel data source [Jeff Nezaj (ADP Research), Nela Richardson (ADP Research) and Liv Wang (ADP Research)
Working Papers 25-5]

This paper adds to a growing body of evidence on the underlying determinants of pandemic and postpandemic wage patterns by leveraging private-sector payroll records from ADP Inc., a dataset that comprises more than 25 million employees, or about 1 in 6 workers in the United States. The paper finds that the pandemic’s disruption of industry sectors and workers drove large swings in pay growth as lower-wage workers left the labor force in the spring of 2020 and were hired back a year later. It also triggered a shift to larger year-over-year pay gains that so far have endured, albeit with some moderation.

CAIN WON:

Abundance and Its Discontents (James Livingston, 3/07/25, Project Syndicate)

[T]he vision Klein and Thompson offer makes the idea of abundance sound like what awaits the Tribulation Force of the Left Behind film franchise, whose members prove they are worthy of joining the Raptured in heaven by working hard against the anti-Christ on Earth. The abundance we need and deserve cannot be incentivized by monetizing it and attracting private investors and contractors emboldened by relaxed regulations and officials who are willing and able to bend the rules. Nor does it have to wait on the arrival of another “political order” that will deliver the goods because it tells a “better story,” as per the historian Gary Gerstle’s periodization of the US political party system (eagerly cited by Klein and Thompson). Abundance is here and now, abiding in the simple fact that economic growth doesn’t require more savings, more work, and more fossil fuels (and thus the incineration of the planet), because growth – at any pace – no longer demands larger inputs of either capital and labor.

It’s impossible tyo overstate deflationary pressures.

REDUCING LABOR IS PRODUCTIVITY:

Automate the Ports (Eric Boehm | 10.4.2024, reason)

But whether they are open or closed, many American ports rank among the least efficient in the entire world. The ports in New York, Baltimore, and Houston—three of the largest of the 36 ports that could have been shut down by the ILA strike—are ranked no higher than 300th place (out of 348 in total) in the World Bank’s most recent report on port efficiency. Not a single U.S. port ranks in the top 50. Slow-moving ports act as bottlenecks to commerce both coming and going, which “reduces the competitiveness of the country…and hinders economic growth and poverty reduction,” the World Bank notes.

That so many American ports are struggling to keep up with the rest of the world should be unacceptable.