Companies increase pay rates at lower rates than inflation, so overtime the value of what people actually get paid become less and less. Employees fight back by working slower, accomplishing less, and become generally lazy. The phenomenon that starting salaries for companies are non-negotiable is a sign of this "matured" labor market.
The only counter example in recent memory to this gradual, but inevitable, decline into economic malaise is Silicon Valley in the late 1990s. It was just a few years before the dot com bubble that the labor market saw much fluidity. Everything: salary, benefits, stock options for joining a high tech company can be negotiated. Yet it was only a brief respite, then the labor market regressed back to the mean.
The British train system, built by Empire wealth and money, and if it breaks down today, the contemporary U.K. economy cannot afford to build a new one.
The U.S. highway system, the best in the world and built back in the 1950s. There are no projects of such magnitude that the U.S. government is investing in today.
In a sense we are living on inherited legacies. The government no longer invests, yet collect the same amount of taxes. Ex. the telephone tax. If the private sector is suppose to supplant government investment, where are the tax cuts to the people?
Perfect markets, rational behaviors... the stuff of dreams.
