Small Business Aid Program is Reeling; It Needs More Money ASAP
Author: Greg Valliere
April 8, 2020
THE EVIDENCE IS OVERWHELMING: The $349 billion small business program is in trouble, bogged down by red tape and confusing directives to banks, which are moving glacially — if at all — to get money to companies that need it immediately.
THE COMPUTER GLITCHES AND OTHER SNAFUS eventually will get ironed out, perhaps by the end of April. But there’s another problem that has to be addressed much sooner: the small business program is woefully underfunded, and Congress will have to authorize another $250 billion ASAP.
SENATE MAJORITY LEADER MITCH McCONNELL said yesterday that he would seek unanimous consent on Thursday for an extra $250 billion, but he blindsided Democrats, who are eyeing even more assistance. We had thought that a fourth aid bill would move later this spring, but small businesses need massive help within days.
THERE’S A CLEAR CONSENSUS TO APPROVE THE EXTRA FUNDING, but there are two potential snags: First, could there really be a clean bill, considering all the other demands for more aid? Second, most members of Congress don’t want to come back to Washington, but one lone lawmaker could demand a vote — not unanimous consent — which would require members to travel back to the Capitol Hill petri dish.
THE TRUMP ADMINISTRATION clearly wants more small business funding, amid reports that the Small Business Administration is reeling and unprepared for a torrent of applications. The agency is woefully understaffed, with antiquated computers (excellent article on the SBA in the New York Times this morning).
PRESIDENT TRUMP ADMONISHED REPORTERS for not being “nice” this past weekend in their questions about the chaotic small business aid rollout, which is beginning to resemble the botched roll-out of Obamacare. But this is a disaster, to use one of Trump’s favorite words, and his aides know it.
WITH THE FEDERAL RESERVE PROMISING to provide liquidity to virtually every segment of the economy and the markets, we feel reasonably confident that the country can avoid a Great Depression. But a crucial element of Washington’s massive fiscal aid is small business assistance — and if this continues to look chaotic and unhelpful, chances of a V-shaped recovery will diminish.
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