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Are Wages Too High?

Bernie Sanders appeared on CBS' "Face the Nation" Sunday, sharply criticizing Donald Trump while attempting to appeal to Trump's supporters.

Look, many of Trump's supporters are working-class people. And they are angry. And they're angry because they are working longer hours for lower wages. They're angry because their jobs have left this country and gone to China or other low-wage countries.…

Meanwhile, interestingly enough, John, this is a guy who does not want to raise the minimum wage. In fact, he has said that he thinks wages in America are too high.

Trump attacked back on Twitter, calling Sanders' accusation a lie. Yet Trump actually did say wages are too high during the Republican debate in Milwaukee last month. Asked by Neil Cavuto, "Are you sympathetic to the protesters cause since a $15 wage works out to about $31,000 a year?" Trump gave this reply.

Around the 27 second mark you can hear his summary, "Taxes too high, wages too high, we're not going to be able to compete against the world." Trump's answer reflects his business instincts, in which "competing" means accumulating the highest profits for corporate owners.

This view would not go over well with the average Trump supporter, who, as Sanders notes, feels "angry because their jobs have left this country and gone to China or other low-wage countries."

Surprisingly, though Trump expressed this view more than a month ago, no one has challenged him until now.

But only a day after Sanders' attack, Trump has made an about face, claiming he actually believes wages are "too low" and good jobs are "too few".

Although the headlines now proclaim Trump to be a flip-flopper, it's theoretically possible to believe wages are simultaneously too high and too low. That is, if American workers expect higher wages for doing the same jobs that foreigners will do for less money, it really is difficult to compete on that playing field. On the other hand, a highly educated workforce can compete by creating jobs that demand creativity and critical thinking skills. These jobs pay higher wages because the number of qualified candidates is smaller.

Another way we can compete is by using advanced manufacturing technology, improving the productivity of all workers. If our productivity is five times that of a Chinese factory, our workers can still be competitive at five times the salary of their Chinese counterparts.

But instead of pointing out the productivity gap, Trump initially insisted wages are too high. Now, realizing that his supporters believe the opposite, he's happy to say they are too low. Don't expect any nuanced analysis from Donald Trump.

It's too early to know how this will affect the Trump campaign going forward, but the publicity over the minimum wage can only be positive for Sanders.

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