“Here is the reality,” said Sen. Bernie Sanders in his analysis of Donald Trump’s strong electoral victory and support from some traditional Democrats: “The working class of this country is angry, and they have reason to be angry. We are living in an economy today where the people on top are doing phenomenally well while 60 percent of our people are living paycheck to paycheck.”

Household data spanning 2019-22 support Sanders’ argument. The Federal Reserve found substantial increases in average net worth for all income levels except the poorest 20% of families (though the Fed doesn’t adjust these figures for how much of the accompanying federal debt we’ll each bear). In any case, according to the senator, greed was the main culprit. I think a fair portion of the blame lies with misplaced generosity.

Greed is ever-present in human affairs, but those years included something unique: Massive government efforts to soften the blows of COVID-19. Paradoxically, this helped the rich get richer and contributed to the 2024 political climate.

The government’s stimulus program—much of which ended up as generous but perhaps unintended taxpayer gifts to the wealthy—and Fed interest rate cuts led to rising real estate prices and substantial gains in stock market values. More dollars in the economy meant each dollar was worth less as inflation took off. Higher-income households are less damaged by inflation than working-class people who spend most of their income on goods and services.

Meanwhile, contrary to plans, federal programs disproportionately transferred billions to owners and managers of businesses across the nation rather than to hourly workers. On top of that, a lot of COVID-relief money, paid for in no small part by current or future working-class taxpayers, simply got wasted.

A review of the situation by Cecilia Rouse, Brookings Institution president and chair of the Council of Economic Advisors from 2021-23, offers a revealing and disturbing analysis. Rouse focuses on both the disastrous effects of the pandemic and assessing the massive $4.5 billion in stimulus packages delivered by the Trump and Biden administrations.

Though just four years ago, it bears mentioning that as President Joe Biden took office, some 460,000 Americans had been killed by the pandemic. Before the pandemic’s end, 1.2 million U.S. lives would be taken. The economy’s shutdown brought a devastating disruption to daily life. Rouse points out that in April 2020, “the number of Americans living under stay-at-home orders reached more than 300 million.” Weekly claims for unemployment compensation rose from a typical level of 207,000 in March 2020 to 6,137,000 in April.

Stimulus poured in, we learned to better protect ourselves and things quickly started improving. Employment recovered in record time. The nation dealt with one of the most severe, but thankfully short, disruptions in modern times.

But given the damaging bout with inflation that followed, was the stimulus too large? Was the waste, fraud and abuse too much? Did working class people get a fair share? Or was the system tilted so that higher-income people gained too much?

Rouse examines two specific programs. The $800 billion Paycheck Protection Program (PPP) provided forgivable loans to small businesses and nonprofits to retain workers, meet payroll and insurance costs, and keep the doors open. The Economic Injury Disaster Loan (EIDL) program provided larger loans payable over 30 years. Some 1 million firms received PPP loans and 3.9 million obtained EIDL loans.

Researchers show that two-thirds of the PPP’s forgivable loans went to business owners and shareholders, not to employees or wage earners. The General Accountability Office indicates that fraud totaled $64 billion out of the $800 billion. Estimates of fraud under the EIDL program indicate that $136 billion was siphoned off.

Other research indicates that PPP loans cost between $169,000 and $256,000 for each job saved, more than twice the annual wage of the workers effected. With owners and executives at the top siphoning off money, protecting workers was neither simple nor affordable.

Let us hope that our nation never faces another tragic pandemic. But if it does, let us also hope that our government doesn’t take actions that enable the rich to get richer while the poor get poorer in more ways than one.

Should working-class voters be angry about greed, or at those who enabled it?

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Bruce Yandle is a distinguished adjunct fellow with the Mercatus Center at George Mason University, dean emeritus of Clemson University’s College of Business & Behavioral Science, and former executive director of the Federal Trade Commission.

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