Mark Thoma is absolutely correct when he writes…
“The wealthy think it’s the same — in their minds they are the job creators, what’s good for the wealthy is good for America! — but it’s not.”
This is where I have to ask the question… So if loose monetary policy is good for the wealthy, then why support it? In your mind, you must still agree that they are job creators.
There is a contradiction. Economists seem to think that loose monetary policy will benefit the un-rich, but why can’t they see that this is not the case? Loose monetary policy is creating more imbalance of economic power than seen in a long time. This is not good for society.
So I find it intriguing that economists, and Mark Thoma is not the only one, put Fed policy into a different category from tax policy, financial un-regulation and political influence. Loose monetary policy is just another policy benefiting the rich… bringing undesirable consequences.
This is a moment where you might hear the phrase… “Well, don’t throw the baby out with the bath water.” The meaning is that we would still need loose monetary policy while we deal with other policies that directly benefit the rich. Well, loose monetary policy not only directly benefits the rich, it reinforces the other policies being criticized… and if you look closely, the creature being coddled in the bath water is not a baby, it is a rich person acting like a baby needing to be coddled.