I see this continuing assumption that businesses of any sort always maintain minimum profits distributed so efficiently that any increase in worker pay always translates to increased product cost, perhaps because of an assumption that the owner class either is not taking an 'arbitrage' style profit, or cannot possibly seek to be competitive through taking less owner profit.

The rest of the argument I'm quite sympathetic to. It just always puzzles me, this assumption that labor share will always destroy itself by turning into exactly increased costs, as if owner profit was either nothing, or completely non-negotiable.