The reason is that the effect on the reservation wage feeds through to private-sector wage bargaining almost immediately, while, at the same time, fiscal balances are also directly affected.
A family affair A poor average The red and the black ReprintsThe course of inflation, and interest rates, will depend partly on whether rising prices feed into wage demands.
For the present, Mr. Fields is back in his own apartment in Ronkonkoma with a 24-hour live-in home health aide who, for little more than minimum wage, feeds, bathes, cooks and cleans house for him.
But in July 2008 the ECB raised short-term interest rates because it feared that a rise in headline inflation would feed a wage-price spiral.
The bank governor, Toshihiko Fukui, and his deputy, Toshiro Muto, said last week that Japan's expansion would keep slowing "for the time being" and that the cycle of profits feeding into wages and consumption was "weakening".
In other words, today's labour market just doesn't follow the old-fashioned recipe in which falling unemployment rapidly feeds through, via wages, to inflation.
But until the recovery feeds into higher wages and rising living standards for ordinary Americans, the political payoff is likely to be limited.
The gulf in pay rates that now puts chief executives on 190 times average wages, feeds a widespread feeling of unfairness and the sense that the wealthiest are not shouldering their fair share of economic distress.
(Not to mention having a foreign policy that seeks to promote global stability, rather than generating the kind of regional instability that feeds extremism by waging illegal wars, for instance, or selling arms to regimes known to support the spread of extremist religious ideologies).
The wage barely feeds a married couple but there are few alternatives in these impoverished states.
