Yes. The main point is you need to follow both the asset base (how it is being financed), as well as the ancilliary revenue streams (coming from the assets). Its one thing to skew income to the group X. Its another thing to finance that with financial contracts, being paid for by another group Y. The latter is even more perverse from a perspective of social equity. Capitalism is (even for its most ardernt, free-market supporters) premised on ~proportional returns (ie, x% capital, pro-rata % share of earnings).[1] The liberal-left position is that this should skew somewhat[2].
The illustrated example is worse than both, it skews opposite, making a "sucker" class of the general group Y. If you are in group Y (no matter if you are on the right or the left), you should be thinking WTF, because it is not only contradictory to both principles, it's all self serving to X (incl. both left and right, etc).
I agree with the fact that most of the benefits are going to X, but I'm not at all sure that the cost is being borne by Y, where Y is defined by the poor and middle class. I say this because the reality is that the poor and a big chunk of the middle class in this country do not pay any Federal income tax, which is where the cost of this will be paid from. The lion's share of this will probably be borne in the end by Z, which are the upper middle class and wealthy with earned income who pay the highest marginal tax rates and a huge share of the tax revenue. In fact, the top 20% of households pay 94% of the Federal income tax [1]. They're the ones who are going to pay for this boondoggle, and while that does include hedge fund managers and Donald Trump, it also includes dentists and professors and small business owners.
Of course, this is all just debt right now, so who knows what will end up happening. But given the conversation happening in this country right now, I can't see a big change in the 20% / 94% number above.
Understood, but I'm simply defining Y as not X. Within y, the distribution may not itself be homogeneous. There is also the issue of the regressive (and pernitious) nature of inflation on the Y.
-- The $8 Trillion "bridge loan" that finances this? Split pro-rata, of course, amongst the lower and middle class.
I don't think it will be split amongst the lower and middle class at all really. Upper middle class will end up paying for this. Unless you count the potential for a long-term deleterious effect on our economy, in which case we all get to pay for it :)
