Starbuck wrote:

Doug,

If we raised everyone salary 25%, the net income gain in spending power
would be 0%.

???

You should try and grasp the concept of "marginal rates of change."

If everybody's salary was raised 25% in an instant, and prices remained
constant *at that same instant* then there would very very definitely an
increase in "spending power." It would taper off as prices rose, but
probably would take a while to reach 0.0 if indeed it really did
(increased spending tends to increase investment in production which
tends to increase technology etc etc).

It's not quite the Red Queen's Race, but it's close.

I can see you're another economist wanna-be... did you get your
tremendous expertise from the same "Everything You Need To Know About
Economics In One Easy Lesson" website as that last joker?

DSK