In Focus: Trump’s Disastrous Coronavirus Response, Volume #9

The coronavirus pandemic in the United States continues to worsen because of President Trump.

Volume #9: Trump’s Corrupt Recovery Leaves Small Businesses High and Dry

The economic downturn is the sharpest since the Great Depression. Tens of thousands of small businesses have already shuttered, and the ones who are able to remain open are struggling more than ever. Small business sales expectations have plummeted to the lowest level in history.

It didn’t have to be this bad. Small businesses face a grim outlook in the midst of the coronavirus pandemic, but they have been pushed over the brink by two things: Trump’s delayed and insufficient response to the virus, and his corrupt recovery effort that favors the wealthy and well-connected over small businesses that need the most help.

Trump’s failed implementation of the Paycheck Protection Program (PPP) has left millions of small businesses still waiting for a desperately needed lifeline. Most small businesses can’t get loans at all.

  1. The Trump administration’s decision to run funds for small businesses through big banks ended up preferencing larger firms with cozy relationships, leaving community banks to dole out a much smaller portion of the pie.

  2. The botched rollout of the program and constant rule-shifting about the funds, including the late addition of loopholes that favor large companies, confused and frustrated small business owners who need the loans the most.

  3. Those hardest hit are often minority and women-owned businesses, but Trump failed to provide them sufficient guidance or allocate funds to those underserved communities as was intended.

As a result, only 7 percent of small businesses had received funds by the end of April, and large corporations have vacuumed up more than a billion dollars in funds that were meant for small businesses.

Small businesses are the backbone of our economy. We cannot fully recover until our small businesses recover. Small businesses owners should be able to rely on their government in the time of need, but Trump’s corrupt recovery has left them high and dry.

Trump’s lopsided distribution of PPP funds has left the majority of small businesses in the lurch.

  • Nearly a month into the PPP program, only 7 percent of small businesses had received funds.

  • PPP loans weren’t targeted to the areas or industries hardest hit by the coronavirus.

Trump botched the rollout of the PPP program. It was riddled with glitches and the website crashed almost immediately, frustrating small business owners who are still waiting for this desperately needed lifeline. 

  • Reuters: “The U.S. government’s $350 billion small-business rescue program was plagued by paperwork and technical issues.”

  • The Small Business Administration’s proprietary lending portal went down minutes after it reopened for the second round of PPP loans.

Trump changed the rules governing the implementation of the PPP, shifting the way the program was laid out in the law. These changes frustrated small businesses and could harm their businesses.

  • The Trump administration imposed strict rules on the PPP program that could actually leave small business owners worse off.

  • Vox: “Essentially, a program aimed at helping alleviate the financial burden small businesses are facing right now could ultimately add to it.”

Trump’s uneven distribution of the funds cast aside women and minority business owners.

  • The SBA inspector general found that Trump’s implementation of the PPP left out underserved communities and could saddle small businesses with debt.

  • The Trump administration failed to instruct lenders to prioritize underserved communities, as called for under law.

  • Up to 90% of minority and women small business owners were shut out of receiving PPP loans.

  • A survey of 500 Latino small business owners showed that only 97 respondents who applied for PPP loans got any funding at all in the first round.

Meanwhile, Trump allowed large corporations to take more than a billion dollars in funds meant for small businesses.

  • Nearly 300 publicly traded companies received more than $1 billion meant for small business through the PPP program, including several companies that paid their executives more than $2 million.

  • 41 publicly traded companies with at least two months of operating expenses in cash-on-hand applied for $104 million PPP loans.

  • While the Trump administration imposed strict rules on small business recipients that made the loans burdensome, it did nothing to stop big banks from favoring the wealthy.

Trump favored providing PPP loans to well-connected businesses with ties to him and his campaign.

  • A company whose largest shareholder is Trump’s campaign manager received a nearly $800,000 PPP loan.

  • A data firm for Trump’s campaign got a $2.85 million loan — nearly 14 times the PPP loan average.

  • Fossil fuel firms linked to Trump got $28 million in PPP loans.

  • Three companies with connections to the Trump administration received a total of $18.3 million under the program.

  • Another company with close ties to the Trump administration received a $5.5 million loan.

  • One Trump donor’s hotel — the biggest recipient of PPP funds — got $96.1 million meant for small businesses.

In Focus: Trump’s Disastrous Coronavirus Response, Volume #8 – Volume #10

In Focus: Trump’s Disastrous Coronavirus Response, All Volumes