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That's a great example of the power of Orwellian naming. Only 25% of "Paycheck Protection" funds "trickled down" to workers, while 75% was hoarded by owners. I

That's a great example of the power of Orwellian naming. Only 25% of "Paycheck Protection" funds "trickled down" to workers, while 75% was hoarded by owners. If the objective is to get cash into the pockets of workers, you can just give it to them directly, and they'll get 100% of it. The only possible rationale for implementing a Rube Goldberg system like PPP is if you intend for the vast majority of the funds to get siphoned off by the wealthy long before it makes it down to workers.

vkou 4y ago
> If the objective is to get cash into the pockets of workers, you can just give it to them directly, and they'll get 100% of it. That objective was achieved by opening up the unemployment taps. The objective of PPP was to prevent the destruction of half the businesses in the economy, which would have had knock-on-effects that would have taken years and decades to fully unravel. Think of the bullwhip effect in supply chains that everyone's been bitching about for the past two years. Now, multiply it times ten, because half the participants in the economy collapsed, and their replacements have not gotten their shit together yet, and won't for another five years. Businesses collapsing, and ~identical businesses re-opening next year destroys massive amounts of value. The value was in the human knowledge, connections, contracts, and relationships between them and their suppliers/customers. You lose all of that. PPP was a stop-gap measure to reduce the # of these losses.
- MarkMarine 4y ago
  I think you're thinking of this in a binary sense, like we can either pay the business owners and they will <maybe> pay their employees and then it will be forgiven OR we let those people lose their job and go on unemployment. Those aren't the only options, but even if they were, in the semi industry it was fairly common for the whole company I worked for to shut down for a week or two if the semi economy isn't cranking. We all went on unemployment or took vacation, and came back to our jobs when the company opened again. But, unemployment isn't the only thing we can use, because it does have strings. We expect you to be looking for another job every week, and proving it. The social security system is setup to distribute money to every American with a social security number, in a far more streamlined system. There are also nice systems in place that limit the amount you get from social security in the case that you're earning more than a limit. I think social security being extended to all Americans, letting them stay "at" their job even if it was shut down, and setting a floor for income at this time which would make sure the business owners were also able to buy their basic essentials, but not Lamborghinis, would have been the right move. I understand this would require something to help businesses with rent while they were unable to operate. A national rent holiday to cover the emergency of the pandemic would be one idea, or bailing out the banks that were effected. The way this was implemented isn't the only way it could be implemented is all I'm saying, lots of countries did it other ways, and they didn't collapse in on themselves at the end of covid. The PPP program is not the only solution to keeping workers connected to their jobs, but it sure did create a lot of opportunities for fraud. There are podcasts that took hundreds of thousands of dollars of PPP money. A podcast.
  - vkou 4y ago
    Sure, there are other solutions, and you've given examples of decent ones (rent holidays, mortgage jubilees, etc), and in a better world, we would have undertaken them. We don't live in a better world, finance has a stranglehold on our politics, and PPP was a better alternative than no-PPP. There's much to criticise it, and I don't think it was the best among all possible options, but I do think it was vastly better than nothing (Or just paying people through UI, while their employers fold).
- panarky 4y ago
  > That objective was achieved by opening up the unemployment taps Unemployment compensation generally does not go to employed people.
buttercraft 4y ago
Unless it changed, PPP loan forgiveness required that you spend something like 80% on payroll.
- aqme28 4y ago
  You're commenting on a thread about widespread fraud in the program.
  - buttercraft 4y ago
    Yes, and I was responding to the parent's claims about the rationale behind the program.
- mring33621 4y ago
  'required'
- landemva 4y ago
  The money is fungible, so in my observation the owners pocketed it from a different part of the ledgers at the end of the year.

vkou 4y ago

> If the objective is to get cash into the pockets of workers, you can just give it to them directly, and they'll get 100% of it. That objective was achieved by opening up the unemployment taps. The objective of PPP was to prevent the destruction of half the businesses in the economy, which would have had knock-on-effects that would have taken years and decades to fully unravel. Think of the bullwhip effect in supply chains that everyone's been bitching about for the past two years. Now, multiply it times ten, because half the participants in the economy collapsed, and their replacements have not gotten their shit together yet, and won't for another five years. Businesses collapsing, and ~identical businesses re-opening next year destroys massive amounts of value. The value was in the human knowledge, connections, contracts, and relationships between them and their suppliers/customers. You lose all of that. PPP was a stop-gap measure to reduce the # of these losses.

MarkMarine 4y ago
I think you're thinking of this in a binary sense, like we can either pay the business owners and they will <maybe> pay their employees and then it will be forgiven OR we let those people lose their job and go on unemployment. Those aren't the only options, but even if they were, in the semi industry it was fairly common for the whole company I worked for to shut down for a week or two if the semi economy isn't cranking. We all went on unemployment or took vacation, and came back to our jobs when the company opened again. But, unemployment isn't the only thing we can use, because it does have strings. We expect you to be looking for another job every week, and proving it. The social security system is setup to distribute money to every American with a social security number, in a far more streamlined system. There are also nice systems in place that limit the amount you get from social security in the case that you're earning more than a limit. I think social security being extended to all Americans, letting them stay "at" their job even if it was shut down, and setting a floor for income at this time which would make sure the business owners were also able to buy their basic essentials, but not Lamborghinis, would have been the right move. I understand this would require something to help businesses with rent while they were unable to operate. A national rent holiday to cover the emergency of the pandemic would be one idea, or bailing out the banks that were effected. The way this was implemented isn't the only way it could be implemented is all I'm saying, lots of countries did it other ways, and they didn't collapse in on themselves at the end of covid. The PPP program is not the only solution to keeping workers connected to their jobs, but it sure did create a lot of opportunities for fraud. There are podcasts that took hundreds of thousands of dollars of PPP money. A podcast.
- vkou 4y ago
  Sure, there are other solutions, and you've given examples of decent ones (rent holidays, mortgage jubilees, etc), and in a better world, we would have undertaken them. We don't live in a better world, finance has a stranglehold on our politics, and PPP was a better alternative than no-PPP. There's much to criticise it, and I don't think it was the best among all possible options, but I do think it was vastly better than nothing (Or just paying people through UI, while their employers fold).
panarky 4y ago
> That objective was achieved by opening up the unemployment taps Unemployment compensation generally does not go to employed people.

buttercraft 4y ago

Unless it changed, PPP loan forgiveness required that you spend something like 80% on payroll.

aqme28 4y ago
You're commenting on a thread about widespread fraud in the program.
- buttercraft 4y ago
  Yes, and I was responding to the parent's claims about the rationale behind the program.
mring33621 4y ago
'required'
landemva 4y ago
The money is fungible, so in my observation the owners pocketed it from a different part of the ledgers at the end of the year.