10 ms·

So many complaints here. Based on the comments I think there is some misunderstanding about the nuts and bolts of this program. These are loans. They are two

by eric_b 6y ago

So many complaints here. Based on the comments I think there is some misunderstanding about the nuts and bolts of this program. These are loans. They are two year low interest loans. They have to be paid back unless some or all is forgiven. Forgiveness requires documentation on employees retained, wage history, and is capped at $20k/employee maximum. And of course a piece of that comes back to the government in terms of payroll taxes. Just because a company took a 1M loan, doesn't mean it will be 100% forgiven. For those complaining the companies don't "need" the money - I know many households who received $4k+ in stimulus checks that didn't need it. Should they not have taken it? And anyways, the whole point of this program was to get money to businesses quickly. Means testing takes time. Sure there are going to be some questionable loans. Some fraud too. But overall our government has spent a lot more money and gotten worse returns than the PPP.

ta17711771 6y ago
> unless some or all is forgiven. RIPE for favoritism, aka, corruption.
- eric_b 6y ago
  I don't think favoritism is a concern. The forgiveness guidance is not, to my knowledge, finalized. But what we've seen so far is pretty cut and dried. It's possible some people could convince their lender to forgive more than they should - but certainly those meeting the forgiveness criteria will get it. Corruption and fraud are certainly possible - though the lenders got paid from the government just for originating the loans. That is, they already made their money. There's no extra money in them over-forgiving a loan.
  - IG_Semmelweiss 6y ago
    Favoritism on the part of banks was real. Source - applicant for 4 separate, PPP loans that were eventually awarded. Banks are not stupid. They awarded funds first to their clients that had outstanding loans with them. That meant the banks' own portfolio was not impaired, thanks to influx of PPP
- marcinzm 6y ago
  Huh? There are rules that if followed allow for forgiveness. The rules will presumably be applied fairly and equally to everyone. That's about the exact opposite of favoritism.
  - resters 6y ago
    Fairly does not entail equally. Chances are there will be a political calculation done by whoever is in power at the time, and loans will be disproportionately forgiven in a way that offers the most political benefit. The approach taken will be touted as "fair" and the recipients "most deserving of forgiveness".
  - _curious_ 6y ago
    I don't see why @IG_Semmelweiss comment here is dead, it's not wrong...banks were incentivized to provide capital to their highest debtors / longest clients who otherwise were at greater risk of default and loss to the bank shareholders. It's not complicated, they acted in their best interest because there was by design nothing stopping them.
tinalumfoil 6y ago
> Should they not have taken it? I seriously considered not cashing my stimulus check until I talked to multiple well off people that cashed their dead relative's checks. There just isnt a cultural expectation in the US that you wouldn't take what you're given. EDIT: Rethinking my comment I'm giving myself too much credit. Since I never got a physical check, I couldn't have "not cashed it" if I wanted to.
- mc32 6y ago
  >’ cashed their dead relative's checks.’ Unless there is some weird allowance (widower/widow inheritance, etc.) wouldn’t this be straight fraud? I know in some countries people don’t report their relatives’ deaths in order to keep receiving their benefits, but obviously that’s illegal too.
  - A4ET8a8uTh0 6y ago
    Short answer is likely yes. Long answer is that depending on individual bank policy regarding depositing 3rd party checks, relationship with tellers/branch manager/what have you, or whether person verifying exceptions for remote deposit is sleepy that day, it may very well end up being undetected. And thats checks. ACH is a whole different can of worms. In a sense, I am glad it is getting some scrutiny as clearly people who did not need the money benefited ( likely at the expense of people who really needed it - the currently public fraud cases are pretty amazing already ), but I am worried that this kind of scrutiny will make people hesitant to apply in the future just to avoid the headache.
    - mc32 6y ago
      Doing some of that could get people into lots of trouble. Not sure if they could get them with wire fraud if it’s a physical check but at least financial fraud, impersonation, faking a signature, caching someone else’s check, etc...
  - michaelmrose 6y ago
    It is straight fraud good for years in prison.
cj 6y ago
Edit: Removed my comment, the original comment was refuting the $20k cap, but I misinterpreted the parent's comment when first reading it. Sorry!
- eric_b 6y ago
  https://home.treasury.gov/system/files/136/3245-0407-SBA-Form-3508-PPP-Forgiveness-Application.pdf https://home.treasury.gov/system/files/136/3245-0407-SBA-For... > if a 24-week Covered Period applies, does not exceed 2.5 months’ worth of 2019 compensation for any owneremployee or self-employed individual/general partner, capped at $20,833 per individual; and > if the Borrower has elected an 8-week Covered Period, does not exceed 8 weeks’ worth of 2019 compensation for any owner-employee or self-employed individual/general partner, capped at $15,385 per individual.
  - deleted 6y ago
    [deleted]
_fullpint 6y ago
my original comment was misinformed
- latortuga 6y ago
  There's still PPP money left so I'm not sure what your point about the finite sum is.
  - digitaltrees 6y ago
    There is money left because people were scared shitless after the SBA threatened criminal prosecution for misleading certifications. The problem is that issued a statement redefined the certification after the fact and made it much more strict and than when they were initially released. All of the sudden a bunch of people thought accepting the PPP funds would land them in Jail. Go to the reddit PPP or small business threads and you’ll see tons of people returning funds and expressing fear. It’s important to note that the SBA issued its announcement after the public outrage of large companies receiving PPP. They have since back tracked and issued a blanket protection from audit for loans under $2M but the damage was done and the $130B hasn’t been touched since.
    - vmception 6y ago
      > They have since back tracked and issued a blanket protection from audit for loans under $2M anything I can read about that?
      - e1g 6y ago
        https://www.journalofaccountancy.com/news/2020/may/sba-safe-harbor-for-ppp-loans-under-2-million.html https://www.journalofaccountancy.com/news/2020/may/sba-safe-...
    - ryanwaggoner 6y ago
      To be fair, this is mostly conjecture on your part. Reddit threads aren't a good way to get a handle on what millions of businesses of all different sizes are doing or why.
icedchai 6y ago
These loans may as well be grants. Any company with even a half decent accountant will make sure that most of the loan amount is forgiven.
throwaway_USD 6y ago
>These are loans. They are two year low interest loans. They have to be paid back unless some or all is forgiven. This is a highly politicized way to frame PPP loans. Its more like: "These loans are forgiven, unless you scammed the government." These loans were specifically designed to be forgiven, a minimum of 75% of the loan was to be for payroll and if used for payroll (what it was supposed to be used for) that portion of the loan will be forgiven. >Just because a company took a 1M loan, doesn't mean it will be 100% forgiven. Again this is so carefully worded to send a false signal...true "it doesn't mean" it will be 100% forgiven. But again the goal is for at least 75% to be forgiven up to 100%. The idea is businesses were supposed to get a loan with 75% allocated to payroll expenses and the extra 25% to approved non-payroll expenses (example: rent) and the portion used for payroll should be 100% forgiven...which in many cases will be the full amount of the loan, because many businesses didn't add an extra 25% for non-payroll expenses and just took the forgivable payroll portion. Basically the only reason/way these loans would be repaid is if business took out the loans and spent the money on non-payroll expenses...that should be fraud and result in jail not a nice cushy 1% interest rate for people committing fraud.
- hn_throwaway_99 6y ago
  Totally agree, and I think this is important to emphasize. I was involved in researching the requirements for a PPP loan for a nonprofit. I can guarantee that the vast majority of businesses (like 95%+) took out these loans with the intention they would never be paid back. Indeed, that was a feature, not a bug, of the whole "loan" program. If you took out the loans to keep employees on staff (and did so), then you had to fuck up hard to not have the loans be forgiven. So it kind of irks me to see some people frame this like a large percentage of these loans will be paid back. Not only is that not the case, it was never intended to be the case.
  - throwaway_USD 6y ago
    >So it kind of irks me to see some people frame this like a large percentage of these loans will be paid back. I constantly see this..."its not free money, its a loan, and the money will be paid back with interest, just like in 2008." No, its free money for businesses, many of which will fail and let their employees go anyway. Then you hear people claim how somehow it was a victory to keep people off unemployment for 8 weeks, but not a single person can explain why that is such a benefit. Its sort of like saying hey when Corona virus began I stopped flights from Country X and saved 10's of thousands of lives...maybe deaths were delayed but there is no evidence they were prevented.
deleted 6y ago
[deleted]
mbesto 6y ago
> Forgiveness requires documentation on employees retained, wage history, and is capped at $20k/employee maximum. And of course a piece of that comes back to the government in terms of payroll taxes. Just because a company took a 1M loan, doesn't mean it will be 100% forgiven. I think your misunderstanding is that the rules actually get followed. What happens when everyone in the scheme comes back and says "the economy is shit, we can't pay that regardless" or more optimistically businesses that have 100's of employees that simply plea with the government that they can't repay their loans, but should be given 100% forgiveness in the spirit of "keeping unemployment low". It's far too political to introduce/enforce anything that makes unemployment numbers worse. It's like a "too big to fail" on a much larger order of magnitude. > the whole point of this program was to get money to businesses quickly. Means testing takes time. Sure there are going to be some questionable loans. Some fraud too. But overall our government has spent a lot more money and gotten worse returns than the PPP. I consider rape less evil than murder so hey I guess I shouldn't be so critical of rapists! Look, I know those things aren't totally analogous, but the point is that it's OKAY to be critical of the government, especially when a government program benefits those who need it the least.
- digitaltrees 6y ago
  Why would it be a problem to redesign a social policy in the social interest? So what if everyone one comes and says PPP needs to be amended to do better in service of the country. Isn’t that what we want. It’s a good thing that they increased the spending period from 8 weeks to 24. Most restaurants were closed by state orders and were faced with forcing employees to come off unemployment (and employees resisted because unemployment was way better for them as they got an extra $600 week on top of regular pay) only to then pay them to stay home. Instead, by extending the spending window we give restaurants a fighting chance to have money to start operations again when it’s safe. Let’s tone down the rhetoric a bit, in no way are PPP loans close to rape or murder in magnitude of harm so it’s an inflammatory analogy with no purpose. In terms of the actual problems with PPP and percent of bad loans. Think of the counter factual. Would you rather have 1% bad loans or a wave of bankruptcies and layoffs triggering a depression that last 10 years? What about 10% bad loans? 50%? The PPP was well designed and administered under the circumstances. Let’s make improvements because we are not out of the woods yet. But let’s not scape goat or focus on the edge case problems and then destroy all of the benefits prevented harm.
JPKab 6y ago
There's a lot of weirdness lately about people expecting companies to not take the money. The virus wasn't any company's fault. The choice to respond to the virus by shutting down the economy wasn't any company's fault. Previous epidemics in human history have been dealt with by simply accepting a death rate that modern society, via government policy, has chosen to not accept. This was an unprecedented response that no business could have predicted. Why do so many of us view businesses who pay employees as the enemy? Agreed 100% on the fact that many of us on this board got stimulus checks that were later spent on mountain bikes or other luxury items. Members of the privileged keyboard class didn't need them at all. People who work with their hands ought to be pretty pissed off they simply didn't get double what they got while we received nothing.
- digitaltrees 6y ago
  I agree with this. Any argument about moral hazard is out the window. Any argument about this being like “too big to fail” is misapplied. Banks in 2008 created the crisis and their risky loan portfolios and balance sheets. No company created Covid or state shutdowns. Let’s come together with a spirit of generosity and cooperation. Not petulance and resentment.
  - freehunter 6y ago
    Those things didn't cause covid, but they did cause the companies to be unable to handle the crisis. The outrage is mostly centered around companies who are wildly profitable and/or spend tons of money on stock buybacks and dividends instead of planning for an inevitable disaster. Look at this: in 2019 Delta Airlines spent around $2b buying their own stock [1]. They also spent $300m buying their own stock in March 2020. In April 2020 they received $5b in government assistance [2]. What if instead of spending billions of dollars to improve their stock price, they saved some of that money in case they ever had a crisis to deal with? It's not like this is the first time the airlines have been bailed out before, either. 9/11 wasn't that long ago. [1] https://ycharts.com/companies/DAL/stock_buyback https://ycharts.com/companies/DAL/stock_buyback [2] https://finance.yahoo.com/news/major-u-airlines-accept-government-015610935.html https://finance.yahoo.com/news/major-u-airlines-accept-gover...
vsareto 6y ago
>I know many households who received $4k+ in stimulus checks that didn't need it. Should they not have taken it? I'd rather have some of the waste money going to families over businesses for once. Families have to worry about loss of income and loss of health during this. Businesses just have to worry about income. Families are more fragile and should be prioritized.
- dfxm12 6y ago
  Yeah, I don't understand the obsession with means testing support through such a crisis. Forgetting the issues with means testing in general [0], in this specific case, you can genuinely go from not needing it to needing it pretty quickly. 0 - https://en.wikipedia.org/wiki/Means_test#Criticism https://en.wikipedia.org/wiki/Means_test#Criticism
- codegeek 6y ago
  I am not necessarily disagreeing with you but a lot of small businesses in the US survive on thin margins and the owners also don't make a lot of money necessarily. So it is not always the case that a company only has to worry about income. They have to worry about paying employees, ensuring they can meet payroll (which in turn helps families of those workers), keep liabilities in check and many other issues. I am totally with you when it comes to companies with deep pockets but a lot of very small businesses are really just a group of individuals trying to survive together.
  - balls187 6y ago
    The outrage is that the money didn't go to small businesses, but rather large ones who had the means to cheat the system.
    - robhunter 6y ago
      Why would there be outrage? There is $130b+ in PPP remaining for small businesses and it's incredibly easy to apply now.
bane 6y ago
https://www.nbcnews.com/business/business-news/here-are-some-billionaires-who-got-ppp-loans-while-small-n1233041 https://www.nbcnews.com/business/business-news/here-are-some...
technothrasher 6y ago
> and is capped at $20k/employee maximum Only owners are capped at $20K. Employees are capped at $46K over the 24 week period, which works out to be that any employee making $100K or less annually is full covered under forgiveness.
deleted 6y ago
[deleted]
Nelson69 6y ago
I think this program is generally well intentioned. I directly know organizations that benefited from it and it absolutely helped cushion the blow of initial lock-down. I also think that any time the US federal government is offering out free or low cost money it is imperative that we look closely and carefully, especially when the program was thrown together in a week or two. "Need" is probably not the way to look at this, anytime there is "free money" there will be incredibly wealthy businesses and organizations with "need." There is a school of thought that you should "always need" free money. I think that's just business. I think the actual distribution is where you look. It would be completely foolish, ATMO, to believe that every organization, bank, and business were treated equally or fairly in this process. We already know that banks like Cross River handled what appears to be a disproportional amount of the approved "loans," presumably because they are a slick fintech business. When the dust fully settles, I would be shocked if the distribution of the funds or the forgiveness was in any way egalitarian, the country just isn't. I fully expect that it will be another mechanism in which certain classes benefit from the US system and others will have been overlooked. And maybe there will be another excuse, minority owned small businesses may not have been as "well banked" as others or something and your choice of bank will be another differentiator. I've heard a couple stories of orgs that didn't even get applications from their banks until the fund was depleted. There will be some great success stories too, I'll reiterate that I think the program is based in good intentions. I just can't see it being executed fairly though, not when they're actually debating on whether the Bubba Wallace noose was a "hoax" or not and the president chimes in...
aleksandrm 6y ago
Care to elaborate how could a household receive 4k plus in stimulus? Was it 4 different people who had earned 99k or less in one household?
- dragonwriter 6y ago
  > Care to elaborate how could a household receive 4k plus in stimulus? Married couple with up to $150K AGI ($2,400) + 4 dependent children ($500 × 4) is $4,400.

by eric_b 6y ago

ta17711771 6y ago

> unless some or all is forgiven. RIPE for favoritism, aka, corruption.

eric_b 6y ago
I don't think favoritism is a concern. The forgiveness guidance is not, to my knowledge, finalized. But what we've seen so far is pretty cut and dried. It's possible some people could convince their lender to forgive more than they should - but certainly those meeting the forgiveness criteria will get it. Corruption and fraud are certainly possible - though the lenders got paid from the government just for originating the loans. That is, they already made their money. There's no extra money in them over-forgiving a loan.
- IG_Semmelweiss 6y ago
  Favoritism on the part of banks was real. Source - applicant for 4 separate, PPP loans that were eventually awarded. Banks are not stupid. They awarded funds first to their clients that had outstanding loans with them. That meant the banks' own portfolio was not impaired, thanks to influx of PPP
marcinzm 6y ago
Huh? There are rules that if followed allow for forgiveness. The rules will presumably be applied fairly and equally to everyone. That's about the exact opposite of favoritism.
- resters 6y ago
  Fairly does not entail equally. Chances are there will be a political calculation done by whoever is in power at the time, and loans will be disproportionately forgiven in a way that offers the most political benefit. The approach taken will be touted as "fair" and the recipients "most deserving of forgiveness".
- _curious_ 6y ago
  I don't see why @IG_Semmelweiss comment here is dead, it's not wrong...banks were incentivized to provide capital to their highest debtors / longest clients who otherwise were at greater risk of default and loss to the bank shareholders. It's not complicated, they acted in their best interest because there was by design nothing stopping them.

tinalumfoil 6y ago

> Should they not have taken it? I seriously considered not cashing my stimulus check until I talked to multiple well off people that cashed their dead relative's checks. There just isnt a cultural expectation in the US that you wouldn't take what you're given. EDIT: Rethinking my comment I'm giving myself too much credit. Since I never got a physical check, I couldn't have "not cashed it" if I wanted to.

mc32 6y ago
>’ cashed their dead relative's checks.’ Unless there is some weird allowance (widower/widow inheritance, etc.) wouldn’t this be straight fraud? I know in some countries people don’t report their relatives’ deaths in order to keep receiving their benefits, but obviously that’s illegal too.
- A4ET8a8uTh0 6y ago
  Short answer is likely yes. Long answer is that depending on individual bank policy regarding depositing 3rd party checks, relationship with tellers/branch manager/what have you, or whether person verifying exceptions for remote deposit is sleepy that day, it may very well end up being undetected. And thats checks. ACH is a whole different can of worms. In a sense, I am glad it is getting some scrutiny as clearly people who did not need the money benefited ( likely at the expense of people who really needed it - the currently public fraud cases are pretty amazing already ), but I am worried that this kind of scrutiny will make people hesitant to apply in the future just to avoid the headache.
  - mc32 6y ago
    Doing some of that could get people into lots of trouble. Not sure if they could get them with wire fraud if it’s a physical check but at least financial fraud, impersonation, faking a signature, caching someone else’s check, etc...
- michaelmrose 6y ago
  It is straight fraud good for years in prison.

cj 6y ago

Edit: Removed my comment, the original comment was refuting the $20k cap, but I misinterpreted the parent's comment when first reading it. Sorry!

eric_b 6y ago
https://home.treasury.gov/system/files/136/3245-0407-SBA-Form-3508-PPP-Forgiveness-Application.pdf https://home.treasury.gov/system/files/136/3245-0407-SBA-For... > if a 24-week Covered Period applies, does not exceed 2.5 months’ worth of 2019 compensation for any owneremployee or self-employed individual/general partner, capped at $20,833 per individual; and > if the Borrower has elected an 8-week Covered Period, does not exceed 8 weeks’ worth of 2019 compensation for any owner-employee or self-employed individual/general partner, capped at $15,385 per individual.
- deleted 6y ago
  [deleted]

_fullpint 6y ago

my original comment was misinformed

latortuga 6y ago
There's still PPP money left so I'm not sure what your point about the finite sum is.
- digitaltrees 6y ago
  There is money left because people were scared shitless after the SBA threatened criminal prosecution for misleading certifications. The problem is that issued a statement redefined the certification after the fact and made it much more strict and than when they were initially released. All of the sudden a bunch of people thought accepting the PPP funds would land them in Jail. Go to the reddit PPP or small business threads and you’ll see tons of people returning funds and expressing fear. It’s important to note that the SBA issued its announcement after the public outrage of large companies receiving PPP. They have since back tracked and issued a blanket protection from audit for loans under $2M but the damage was done and the $130B hasn’t been touched since.
  - vmception 6y ago
    > They have since back tracked and issued a blanket protection from audit for loans under $2M anything I can read about that?
    - e1g 6y ago
      https://www.journalofaccountancy.com/news/2020/may/sba-safe-harbor-for-ppp-loans-under-2-million.html https://www.journalofaccountancy.com/news/2020/may/sba-safe-...
  - ryanwaggoner 6y ago
    To be fair, this is mostly conjecture on your part. Reddit threads aren't a good way to get a handle on what millions of businesses of all different sizes are doing or why.

icedchai 6y ago

These loans may as well be grants. Any company with even a half decent accountant will make sure that most of the loan amount is forgiven.

throwaway_USD 6y ago

>These are loans. They are two year low interest loans. They have to be paid back unless some or all is forgiven. This is a highly politicized way to frame PPP loans. Its more like: "These loans are forgiven, unless you scammed the government." These loans were specifically designed to be forgiven, a minimum of 75% of the loan was to be for payroll and if used for payroll (what it was supposed to be used for) that portion of the loan will be forgiven. >Just because a company took a 1M loan, doesn't mean it will be 100% forgiven. Again this is so carefully worded to send a false signal...true "it doesn't mean" it will be 100% forgiven. But again the goal is for at least 75% to be forgiven up to 100%. The idea is businesses were supposed to get a loan with 75% allocated to payroll expenses and the extra 25% to approved non-payroll expenses (example: rent) and the portion used for payroll should be 100% forgiven...which in many cases will be the full amount of the loan, because many businesses didn't add an extra 25% for non-payroll expenses and just took the forgivable payroll portion. Basically the only reason/way these loans would be repaid is if business took out the loans and spent the money on non-payroll expenses...that should be fraud and result in jail not a nice cushy 1% interest rate for people committing fraud.

hn_throwaway_99 6y ago
Totally agree, and I think this is important to emphasize. I was involved in researching the requirements for a PPP loan for a nonprofit. I can guarantee that the vast majority of businesses (like 95%+) took out these loans with the intention they would never be paid back. Indeed, that was a feature, not a bug, of the whole "loan" program. If you took out the loans to keep employees on staff (and did so), then you had to fuck up hard to not have the loans be forgiven. So it kind of irks me to see some people frame this like a large percentage of these loans will be paid back. Not only is that not the case, it was never intended to be the case.
- throwaway_USD 6y ago
  >So it kind of irks me to see some people frame this like a large percentage of these loans will be paid back. I constantly see this..."its not free money, its a loan, and the money will be paid back with interest, just like in 2008." No, its free money for businesses, many of which will fail and let their employees go anyway. Then you hear people claim how somehow it was a victory to keep people off unemployment for 8 weeks, but not a single person can explain why that is such a benefit. Its sort of like saying hey when Corona virus began I stopped flights from Country X and saved 10's of thousands of lives...maybe deaths were delayed but there is no evidence they were prevented.

deleted 6y ago

[deleted]

mbesto 6y ago

> Forgiveness requires documentation on employees retained, wage history, and is capped at $20k/employee maximum. And of course a piece of that comes back to the government in terms of payroll taxes. Just because a company took a 1M loan, doesn't mean it will be 100% forgiven. I think your misunderstanding is that the rules actually get followed. What happens when everyone in the scheme comes back and says "the economy is shit, we can't pay that regardless" or more optimistically businesses that have 100's of employees that simply plea with the government that they can't repay their loans, but should be given 100% forgiveness in the spirit of "keeping unemployment low". It's far too political to introduce/enforce anything that makes unemployment numbers worse. It's like a "too big to fail" on a much larger order of magnitude. > the whole point of this program was to get money to businesses quickly. Means testing takes time. Sure there are going to be some questionable loans. Some fraud too. But overall our government has spent a lot more money and gotten worse returns than the PPP. I consider rape less evil than murder so hey I guess I shouldn't be so critical of rapists! Look, I know those things aren't totally analogous, but the point is that it's OKAY to be critical of the government, especially when a government program benefits those who need it the least.

digitaltrees 6y ago
Why would it be a problem to redesign a social policy in the social interest? So what if everyone one comes and says PPP needs to be amended to do better in service of the country. Isn’t that what we want. It’s a good thing that they increased the spending period from 8 weeks to 24. Most restaurants were closed by state orders and were faced with forcing employees to come off unemployment (and employees resisted because unemployment was way better for them as they got an extra $600 week on top of regular pay) only to then pay them to stay home. Instead, by extending the spending window we give restaurants a fighting chance to have money to start operations again when it’s safe. Let’s tone down the rhetoric a bit, in no way are PPP loans close to rape or murder in magnitude of harm so it’s an inflammatory analogy with no purpose. In terms of the actual problems with PPP and percent of bad loans. Think of the counter factual. Would you rather have 1% bad loans or a wave of bankruptcies and layoffs triggering a depression that last 10 years? What about 10% bad loans? 50%? The PPP was well designed and administered under the circumstances. Let’s make improvements because we are not out of the woods yet. But let’s not scape goat or focus on the edge case problems and then destroy all of the benefits prevented harm.

JPKab 6y ago

There's a lot of weirdness lately about people expecting companies to not take the money. The virus wasn't any company's fault. The choice to respond to the virus by shutting down the economy wasn't any company's fault. Previous epidemics in human history have been dealt with by simply accepting a death rate that modern society, via government policy, has chosen to not accept. This was an unprecedented response that no business could have predicted. Why do so many of us view businesses who pay employees as the enemy? Agreed 100% on the fact that many of us on this board got stimulus checks that were later spent on mountain bikes or other luxury items. Members of the privileged keyboard class didn't need them at all. People who work with their hands ought to be pretty pissed off they simply didn't get double what they got while we received nothing.

digitaltrees 6y ago
I agree with this. Any argument about moral hazard is out the window. Any argument about this being like “too big to fail” is misapplied. Banks in 2008 created the crisis and their risky loan portfolios and balance sheets. No company created Covid or state shutdowns. Let’s come together with a spirit of generosity and cooperation. Not petulance and resentment.
- freehunter 6y ago
  Those things didn't cause covid, but they did cause the companies to be unable to handle the crisis. The outrage is mostly centered around companies who are wildly profitable and/or spend tons of money on stock buybacks and dividends instead of planning for an inevitable disaster. Look at this: in 2019 Delta Airlines spent around $2b buying their own stock [1]. They also spent $300m buying their own stock in March 2020. In April 2020 they received $5b in government assistance [2]. What if instead of spending billions of dollars to improve their stock price, they saved some of that money in case they ever had a crisis to deal with? It's not like this is the first time the airlines have been bailed out before, either. 9/11 wasn't that long ago. [1] https://ycharts.com/companies/DAL/stock_buyback https://ycharts.com/companies/DAL/stock_buyback [2] https://finance.yahoo.com/news/major-u-airlines-accept-government-015610935.html https://finance.yahoo.com/news/major-u-airlines-accept-gover...

vsareto 6y ago

>I know many households who received $4k+ in stimulus checks that didn't need it. Should they not have taken it? I'd rather have some of the waste money going to families over businesses for once. Families have to worry about loss of income and loss of health during this. Businesses just have to worry about income. Families are more fragile and should be prioritized.

dfxm12 6y ago
Yeah, I don't understand the obsession with means testing support through such a crisis. Forgetting the issues with means testing in general [0], in this specific case, you can genuinely go from not needing it to needing it pretty quickly. 0 - https://en.wikipedia.org/wiki/Means_test#Criticism https://en.wikipedia.org/wiki/Means_test#Criticism
codegeek 6y ago
I am not necessarily disagreeing with you but a lot of small businesses in the US survive on thin margins and the owners also don't make a lot of money necessarily. So it is not always the case that a company only has to worry about income. They have to worry about paying employees, ensuring they can meet payroll (which in turn helps families of those workers), keep liabilities in check and many other issues. I am totally with you when it comes to companies with deep pockets but a lot of very small businesses are really just a group of individuals trying to survive together.
- balls187 6y ago
  The outrage is that the money didn't go to small businesses, but rather large ones who had the means to cheat the system.
  - robhunter 6y ago
    Why would there be outrage? There is $130b+ in PPP remaining for small businesses and it's incredibly easy to apply now.

bane 6y ago

https://www.nbcnews.com/business/business-news/here-are-some-billionaires-who-got-ppp-loans-while-small-n1233041 https://www.nbcnews.com/business/business-news/here-are-some...

technothrasher 6y ago

> and is capped at $20k/employee maximum Only owners are capped at $20K. Employees are capped at $46K over the 24 week period, which works out to be that any employee making $100K or less annually is full covered under forgiveness.

deleted 6y ago

[deleted]

Nelson69 6y ago

I think this program is generally well intentioned. I directly know organizations that benefited from it and it absolutely helped cushion the blow of initial lock-down. I also think that any time the US federal government is offering out free or low cost money it is imperative that we look closely and carefully, especially when the program was thrown together in a week or two. "Need" is probably not the way to look at this, anytime there is "free money" there will be incredibly wealthy businesses and organizations with "need." There is a school of thought that you should "always need" free money. I think that's just business. I think the actual distribution is where you look. It would be completely foolish, ATMO, to believe that every organization, bank, and business were treated equally or fairly in this process. We already know that banks like Cross River handled what appears to be a disproportional amount of the approved "loans," presumably because they are a slick fintech business. When the dust fully settles, I would be shocked if the distribution of the funds or the forgiveness was in any way egalitarian, the country just isn't. I fully expect that it will be another mechanism in which certain classes benefit from the US system and others will have been overlooked. And maybe there will be another excuse, minority owned small businesses may not have been as "well banked" as others or something and your choice of bank will be another differentiator. I've heard a couple stories of orgs that didn't even get applications from their banks until the fund was depleted. There will be some great success stories too, I'll reiterate that I think the program is based in good intentions. I just can't see it being executed fairly though, not when they're actually debating on whether the Bubba Wallace noose was a "hoax" or not and the president chimes in...

aleksandrm 6y ago

Care to elaborate how could a household receive 4k plus in stimulus? Was it 4 different people who had earned 99k or less in one household?

dragonwriter 6y ago
> Care to elaborate how could a household receive 4k plus in stimulus? Married couple with up to $150K AGI ($2,400) + 4 dependent children ($500 × 4) is $4,400.