Meanwhile, In Cloud Cuckoo Land
Case in point was today's productivity numbers that came straight out of cloud cuckoo land. The Bureau of Labor statistics today released numbers asserting that productivity rose 4.3%. Productivity is supposed to measure how much value workers produced both for themselves in the form of wages/salaries and other forms of compensation and how much value they produce for the companies they work for in the form of profits plus also the taxes that government receives. And even as productivity allegedly rose by more than 4%, real wages fell and so did real tax revenues (even excluding the effects of the so-called tax rebates). And corporate profits literally plummeted.
So how could productivity soar by more than 4% if all stakeholders see their real income fall (even plummet for shareholders). The short answer is that it can't, as long as we are using the proper and meaningful definition of productivity. The only way this is possible is if we use a meaningless definition of productivity that is unrelated to the actual value created by production, which is what is done.
If the U.S. government, and for that matter also other governments, wants to use such an irrelevant and meaningless number, then there is nothing we can do to stop them (apart from writing posts like this). But no economic analysts should treat them as in any way relevant.