The Paycheck Protection Program was part of the CARES Act, passed to help keep small businesses afloat during the social distancing and the economic shutdown during the Covid-19 Pandemic. Funds can go to both small businesses and independent contractors whose work/hours/income have been reduced. As someone who does independent contracting work as a software developer for a local technology company, I am one of the people who was going to be relying on the program to help support my family during the shutdown.
Banks were told that the loans were supposed to come on a “first come, first served” basis. That was not my experience. I was flat out told that despite my qualifying as a small business, that I couldn’t apply til later. Independent contractors, ready to get these funds, were thrown to the back of the line.
The hotel and restaurant industry lobbied to get an exception for chains with fewer than 500 workers per location. This is another part of the problem. Is it possible that these businesses who can lobby to get exceptions so that they can drink from the same trough as the little guys would also be able to muscle their way in and drink it all up before anyone else got a sip?
The CARES act included inspectors general and other oversight to deal with problems in how these funds would be awarded. Donald Trump has problems with inspectors general and he removed one of them who was charged with being the head of the Pandemic Response Accountability Committee (PARC).
Could businesses be trusted to access these funds or would greed win the day? (I think you know the answer.) According to the link above:
Fogo de Chao received $20 million in PPP loans for two locations. How on earth are two locations using that much money?
Ruth’s Chris Steak House had two subsidiaries get $10 million each from JP Morgan Chase. The Ruth’s Chris parent company had $86.6 million in cash on hand. Loans are capped at $10 million but nothing stopped them from getting multiple loans.
Taco Cabana, Potbelly, Kura Sushi, and J. Alexander’s also got loans for multiple millions of dollars that they did not need.
Shake Shack received loans but then returned them. Does that make them any better because they acted on their greed and only gave it back once they were pressured into doing so? The intent to be horrible is still there and they only reversed course when caught. That does not make them any better in my book.
With the hyper-partisan way that Congress works, it is not surprising that they couldn’t reach deals on making sure that we had adequate protections so that legitimate small businesses, independent contractors, and others who needed the money would be first in line before the big dogs got their turn at the trough. This is not to excuse hyper-partisanship in Congress. However, it is a shining example of the greed that takes place. In a time where we are supposed to come together as a nation, these creeps pushed us aside to take from others.
The only answer that we have as people living in the USA is to say no to these establishments who pushed the little guys out of the way to get aid that they did not need. When the pandemic is over (or even before, in those cases where businesses offer some sort of pickup or delivery service) we need to be supporting the small businesses and avoiding the greedy establishments like the plague. Let’s keep ourselves socially distant permanently from these companies listed here.
Do you know of other companies that were not listed here that took money it didn’t need in the PPP? Comment them below. I will make sure to highlight them on my podcast.