My copy of the latest issue of Forbes magazine hit the mailbox after the Federal Reserve announced plans to hold the line on interest rates. Nonetheless, global economist David Malpassadvice is still worth highlighting.

The Fed’s progressive critics are calling for the Fed to keep current policies in place. That doesn’t make sense. The Fed’s seven-year zero-rate policy was supposed to be stimulative, yet income and wealth conditions for most Americans have gotten worse, while a narrow group in the upper crust has gotten much richer. By centralizing credit allocation the policies worsen the opportunities for African-Americans, other minorities, youth, those with fewer skills and those nearing retirement. Many are not only unemployed but also have been left out of the labor force, so they don’t show up in the unemployment rate.

President Obama’s “new norm” economy–slow, government-controlled growth dominated by the Fed’s giant system of allocating credit to the rich–should be a major focus of the economic and political debate. It’s become clear why near-zero rates don’t work. The policy creates a zero-sum game in which more credit goes to the most creditworthy–the government and the well-to-do–but less goes to others. Regulatory policy is limiting leverage, risk-taking and total credit, so the zero-rate policy causes a rationing process that misallocates credit and ends up hurting minorities.

The Fed has never really tried to explain this any differently. It doesn’t say it’s printing money, adding credit or leveling a playing field that’s been tilted toward Wall Street. It counsels patience, promises a trickle-down of wealth and jobs and parrots the annual assurances of big-government economists that the policy will work better next year.