Why Government Mostly Helps People Who Need It the Least…Even During a Crisis
In January 2020, the NASDAQ stock market’s index stood just under 10,000. In the March crash, it fell to 7,000. As of July 10, 2020, it hit 10,600. The U.S. government’s economic policies produced a “recovery” for the rich who own the vast bulk of stocks. Their holdings are worth more now than before COVID-19 hit us. The other major benchmarks for securities, the Dow Jones Industrial Average and the Standard and Poor 500, show similarly dramatic, slightly smaller recoveries.
Massive government economic intervention—what most of its current beneficiaries have always denounced—subsidized those recoveries. The Federal Reserve pumped unprecedented amounts of new money into the U.S. economy after mid-March. That money poured into the stock market and fueled its rise. The U.S. Treasury provided unprecedented direct cash supports to much of corporate America.
Over the same time, government economic support for the working class was too little, too late, and totally inadequate to what could and should have been done. In their unequal impacts, government economic policies were cruel and unjust. In this, they resemble government public health policies. With under 5 percent of the world’s population, the United States accounts for about 25 percent of COVID-19 cases and about 24 percent of COVID-19 deaths globally. All but the most ideologically blinded (and government supporters) know what such a statistic means.
I focus here on how the government’s economic policies affected corporations versus employees, the rich versus the middle class and the poor. Direct government support sustained most corporations. Bigger and richer corporations hire more and better lobbyists, make larger actual or potential donations to politicians and parties, and so on. They thus got big portions of government help. In general, the pandemic and crash hurt medium and small businesses more than big ones, while the latter got disproportionate government help.
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