economy .
In an ideal capitalist society , there needs to exist recognition of individual achievements as well as room for social mobility , or what is often called the “ ladder of opportunity .” Therefore , it is extremely important to balance out the systemic inequality with measures such as , but not limited to , a progressive tax system to give the lower economic classes more opportunity .
The Federal Reserve Bank is a unique monetary organization operating on a dual mandate : Full employment and low inflation . To this end , the Federal Reserve buys or sells government securities at the needs of the economy . For example , when the economy is deteriorating , the FRB would purchase bonds from commercial banks to increase the money supply , lower interest rates , and encourage investment - thereby stimulating the
Such a practice brings more benefits to the top 1 % of the population than any other sector as illustrated in the graph below . This is due to the nature of the Open Market Operation . Because the Federal Reserve earns its income from the interest charged on government securities , the wealthy groups gain access to even more wealth from their conduct . Thus , the majority of the monetary policies are unable to mitigate the problem of income inequality , and can actively worsen it .
Money earned from monetary policies rarely reaches those who are genuinely struggling economically . Income inequality should not be brushed off as a necessary mischance , as it leads to many social implications . The public should realize that timeliness , transparency , and conscientiousness are key to mitigating this crisis . If we seek and act to preserve the global economy , the world might be able to recover .
23 | SLAS TIMES