Faster wage growth is simply not compatible with high fiscal deficits

If all demands were met (we look at the situations of the United States and the euro zone) in the wake of the COVID crisis, there would be both: Faster wage growth , in particular in economic sectors that pay low wages, in order to reduce inequality; High fiscal deficits, due to the need for high public spending in numerous areas. But faster wage growth would bring inflation and higher interest rates, which are incompatible with continued high fiscal deficits. A choice must therefore be made between wage increases and fiscal deficits. For the time being, policymakers have opted for fiscal deficits.