Why does Maddie stand by and not do anything? How is she different from Peggy? (Was Peggy’s friendship important to Maddie? Why? Which lines in the text tell you this?)

Maggie doesn't like Peggy's making fun of Wanda. She doesn't enjoy with Peggy because she is poor herself. She feels embarrassed. Peggy's friendship is important to Maddie as Peggy is liked by everybody in the class. She believed that Peggy would never do anything wrong.
It is evident from these lines:
'She was Peggy’s best friend, and Peggy was the best-liked girl in the whole room. Peggy could not possibly do anything that was really wrong, she thought.'