For years, the left has complained that the wealthy are getting wealthier and the poor are getting poorer. They've long advocated for ill-fated policies that re-distribute wealth. Prior to the 2008 financial crisis, wealth gap disparity was pretty popular, despite the fact that a record number of Americans owned their own homes.
Now, the fervor is beginning to return. We hear the President talking about Wall Street bonuses in one sentence, and foreclosures and the unemployed in another sentence. However, very little data on income disparity after 2009 is currently available (because it's so recent).
This led me to ask, could quantitative easing actually fuel the wealth gap?
Who Has Been Helped?
It's simple, we've created between $2 and $3 trillion since the recession started in an effort to avoid a deflationary spiral, curb unemployment, and return to growth. Yet, those who have been most effected by the recession haven't seen these benefits. A recent study found that only 7% of those who lost their jobs in the recession are back to where they were before the economy crashed. (As a side note, I personally lost two jobs in the recession, and am currently better off than I was in 2009. I take great pride in this, but it is my doing, not the Fed's and certainly not the federal government's).
It's obvious that money isn't increasing anything in the middle class and that makes sense. The Fed is going to give money to the wealthy, centralized institutions and rely on them to distribute it for returns across the country. They've been doing this for nearly 100 years. Therefore, it would make sense that the wealthy would have first access to the government printing press.
Purpose of the Argument
The reason I'm bringing this up is because it's my belief that quantitative easing has not been beneficial to our economy. Additionally, I'm concerned that any additional wealth gap created as a result of this, could lead to future ill-fated economic policies (essentially a horrible decision resulting from a bad solution).
The proponents of quantitative easing use just as phony reasoning as those who supported the stimulus. They argue that each saved us from a "worse ending." However, don't you think that hundreds of billions of dollars have a noticeable impact on our economy? We need to learn these lessons quickly, otherwise we are prone to greater (and more idiotic) economic policies.
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