Who got those PPP loans? The government doesn’t want to tell.
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Who got the more than $500 billion in Paycheck Protection Program loans that the CARES Act gave to businesses to ease the pain of the pandemic? We may never know.
Treasury Secretary Steven Mnuchin and National Economic Council Director Larry Kudlow say the information should not be released.
The Treasury Department is funding the CARES Act with taxpayer money. When the government shells out your taxpayer money, it usually tells you where it’s going.
“The accountability for who gets it, how much they receive and whether they’re entitled to it. That is a trust factor,” said Emma Coleman Jordan, professor of business law at Georgetown University.
The Trump administration said what we should care about is that the loans comply with the CARES Act. But who received them? The treasury secretary told Congress last week that it’s “proprietary information.”
Mehrsa Baradaran, a law professor at the University of California, Irvine, thinks there are a couple of other things at play.
“Part of this bill is they left it a lot up to banks. And it’s possible that they just don’t know where the funds went,” Baradaran said. “It’s possible that they do know, and they don’t want us to know.”
We do know where some of the money went — to big names like Shake Shack and Potbelly, which pledged to return the loans. But we only know that because they’re publicly traded companies.
“PPP was sold to the American public as loans to small business workers,” said Aaron Klein, a fellow at the Brookings Institution. “They’ve become grants to big business creditors.”
Grants, not loans, because businesses don’t have to repay them if they fulfill certain requirements, like rehiring staff. Klein said that makes transparency crucial.
“Failing to disclose who got this money undermines this response and future responses,” he said. Klein doesn’t just mean future bailouts. He means like tomorrow. Because there’s still about $130 billion left in the PPP pot.
COVID-19 Economy FAQs
Pfizer said early data show its coronavirus vaccine is effective. So what’s next?
In the last few months, Pfizer and its partner BioNTech have shared other details of the process including trial blueprints, the breakdown of the subjects and ethnicities and whether they’re taking money from the government. They’re being especially transparent in order to try to temper public skepticism about this vaccine process. The next big test, said Jennifer Miller at the Yale School of Medicine, comes when drug companies release their data, “so that other scientists who the public trust can go in, replicate findings, and communicate them to the public. And hopefully build appropriate trust in a vaccine.”
How is President-elect Joe Biden planning to address the COVID-19 pandemic and the economic turmoil it’s created?
On Nov. 9, President-Elect Joe Biden announced three co-chairs of his new COVID-19 task force. But what kind of effect might this task force have during this transition time, before Biden takes office? “The transition team can do a lot to amplify and reinforce the messages of scientists and public health experts,” said Dr. Kelly Moore, associate director for the Immunization Action Coalition. Moore said Biden’s COVID task force can also “start talking to state leaders and other experts about exactly what they need to equip them to roll out the vaccines effectively.”
What does slower retail sales growth in October mean for the economy?
It is a truism that we repeat time and again at Marketplace: As goes the U.S. consumer, so goes the U.S. economy. And recently, we’ve been seeing plenty of signs of weakness in the consumer economy. Retail sales were up three-tenths of a percent in October, but the gain was weaker than expected and much weaker than September’s. John Leer, an economist at Morning Consult, said a lack of new fiscal stimulus from Congress is dampening consumers’ appetite to spend. So is the pandemic.
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