People above average (way less than half of the population) are working less for more reward. How? They are investing time for their better future either with more work or with learning. The positive effect is that the above average worker will find a higher paying job (in real inflation corrected terms) than the average ones because he or she has a higher economic value. They will significantly raise the non-weighted statistics for average income. The negative effect is the widening income scissors between these two groups, which as we already learned from history can lead to falling civilizations.
The average worker will work the same amount or less for the same or less (in real buying power) money. To prove this statement, here is an example:
Let’s imagine that a typical worker wants to buy the latest (in forreign currency ever more expensive) Iphone. Most of them can’t afford to pay one from their monthly salary, so they need to decide. Either work harder/more or to get a loan. An average worker doesn’t want to work more. Why? Because they don’t feel the importance. They see for generations that the price tags rise faster than their income even if they work harder, so they accept it “as it is” and they choose the easier way.
For decades now (in western countries) most choose to get a loan for even small things, like for an Iphone. But with buying expensive things and with it deepening into ever more loans they are getting more and more dependent on their current job. Soon they will be afraid to ask for more money (above CPI correction) because they might lose their job and in that case they could not pay their bills. With real inflation (not CPI) their salary real worth is getting slowly but surely wiped out and they can barely pay their loans, not to mention the increasing house, food, transport and leisure prices.
People living in the bottom of the Maslow pyramid can be controllable. Stuck in this situation they are not educating themselves, they hope for real help from their elected politicians (which never comes). The nowadays easy reachable cheap loans are just speeding these processes up.
With these terms and with a high time-preference thinking it will urge them to find easy ways for getting instant happiness (endorfin) in a wide range from Netflix to Sugary foods, pushing them further and further away from investing and not wasting time. It’s a lifetime trap which is embedded in the FIAT system.
The positive effect that these cheap loans will boost sales and shows (falsely) the economy is growing. The negative effect is that these debts will never be paid back and this thinking will likely never change in this group, so we are making future generations more and more in debt.
In a sound-money environment the above average worker will make even more income (at least at the beginning of the tranzition). The average worker will not get cheap loans and they learn to work hard for important things in their life. In the meantime they experience the most important thing. The ever increasing worth of their salary. With this experience they will change their time-preference for a lower one because they will choose wisely which things they really need to buy, knowing “tomorrow” their money will be worth more. Raising children in a low time-preference environment will wipe the earlier “average ones” thinking and will speed things up towards conversion of the population to a flourishing civilization.