Congress Could Pass $250B Legislation Targeted At Helping Small Businesses As Early As This Week
Heavy requests for the previously approved $350 billion in loans push lawmakers to consider augmenting the original $2.2 trillion package with a smaller bill geared to help small businesses. Meanwhile, the Small Business Administration struggles with an aging system while under immense strain from the influx of emergency loan requests. In other news: Democrats eye Medicaid incentives for the next stimulus package; a comparison of the stimulus packages to the 2008 bailout; how much Trump hotels could benefit; and more.
The New York Times:
With Demand Soaring, Congress Weighs Adding $250 Billion In Small-Business Aid
Rushing to shore up a $2 trillion economic stimulus effort that is already under strain, Congress could move as early as this week to approve another $250 billion in aid for small businesses, after the Trump administration asked for additional funds to support an overwhelming demand for help. The request for a quick infusion of more money, which Republican and Democratic leaders acknowledged was necessary, signaled a recognition among lawmakers and the administration that the historic economic stabilization package enacted only two weeks ago to help businesses survive the economic damage of the coronavirus pandemic did not go nearly far enough. (Cochrane and Tankersley, 4/7)
The Wall Street Journal:
Lawmakers, White House Vow To Quickly Provide More Small-Business Loans
Senate Majority Leader Mitch McConnell (R., Ky.) said he was aiming to pass a bill by the end of this week. With lawmakers out of town, Mr. McConnell will need agreement with Senate Minority Leader Chuck Schumer (D., N.Y.) to pass the measure through unanimous consent or a voice vote. Lenders have been inundated with applications for the funds since the program launched on Friday. (Duehren, Rudegeair and Davis, 4/7)
The Hill:
Phase-Four Virus Relief Hits A Wall
Pressure is building on Congress to pass another round of coronavirus relief legislation, but Republicans and Democrats have different ideas about what’s needed and how fastDemocrats want to move swiftly while GOP aides warn it’s unlikely a fourth bill will pass before May. (Bolton, 4/7)
The New York Times:
Small Business Aid Program Stretches Agency To Its Limits
Five days after the start of a $349 billion emergency effort to get money into the hands of small businesses, the agency at the heart of the program is emerging as its biggest bottleneck. The Small Business Administration, lightly staffed and working with aging technology, has been caught unprepared for the onrush of demand from desperate small-business owners who urgently need these loans as the coronavirus stalls the economy. In a boom year, the agency backs $30 billion of small-business loans — about the same amount that banks are now seeking on behalf of their customers in a day. (Flitter, McCabe and Cowley, 4/7)
ABC News:
'Hot Mess': Small Businesses Besieged By Problems Getting Coronavirus Loans
Michael Shemtov is struggling to keep his small cafe in Charleston, South Carolina, afloat. He has already shuttered nine of his restaurants in that state and Tennessee amid the financial fallout of the coronavirus pandemic, with a total of 300 staff now out of work through no fault of their own. For Shemtov, who is now down to a skeleton crew of 10 employees at The Daily and is struggling to hold on, getting a loan from the federal government’s new $350 billion government-backed, low-interest loan program, known as the Paycheck Protection Program (PPP), means the difference between life and death for his business, a sentiment echoed by scores of small businesses across the country whose owners spoke with ABC News. (Turner, Parks and Kolinovsky, 4/7)
Politico:
Bankers Plead With Trump: Fix Small Business Rescue Plan
Frustrated bankers on Tuesday directly appealed to President Donald Trump to fix problems with a Small Business Administration system that is holding them back from issuing $350 billion in government-backed loans designed to avert mass layoffs during the coronavirus pandemic. Trump discussed the state of the so-called Paycheck Protection Program on a teleconference with several of the biggest U.S. banks and small lenders. Attendees on the call included the CEOs of Bank of America, Citigroup and Goldman Sachs. (Warmbrodt, 4/7)
Politico:
Dems Eye Medicaid Incentives For Next Coronavirus Rescue Package
Democrats are considering a new strategy to win over Obamacare holdouts in the states: generous enticements to expand Medicaid in the next coronavirus rescue package. In an interview, Sen. Doug Jones (D-Ala.) is hoping that any future relief measure from Congress includes his bill with Sen. Mark Warner (D-Va.) that would fully pay for states to cover working-age adults for three years, just as the government did for early expansion states in the first days of the Affordable Care Act. (Levine, 4/7)
Reuters:
Wobbly U.S. Fiscal Response Could Deepen Coronavirus Recession
The U.S. government’s massive effort to nurse the economy through the coronavirus crisis was billed as a send-money-and-don’t-sweat-the-details flood of cash to people and businesses in a $22 trillion system that has ground to a halt. So far, the checks are not in the mail. From technological glitches to confusion over the fine points of policy, the delays are mounting. The federal government’s muddled response risks deepening and lengthening a recession already historic for the speed of its onset. (Schneider and Lawder, 4/8)
ProPublica:
How The Coronavirus Bailout Repeats 2008’s Mistakes: Huge Corporate Payoffs With Little Accountability
In 2008, the first of the once-in-a-lifetime economic calamities of most of our lifetimes engulfed the country and the world. Now, just over a decade later, we get to experience the second. How well the country responded to the 2008 global financial crisis is still subject to debate. After the crisis peaked in September 2008 and the government intervened with various bailout programs, the financial system and corporate America stabilized. Corporate profits were rising again by the second half of 2009. (Eisinger, 4/7)
ProPublica:
Yes, Trump Hotels Do Appear To Qualify For Coronavirus Bailout Benefits.
Last month’s $2 trillion bailout bill barred President Donald Trump, his family or other officials from benefiting from one of the law’s giant loan programs. But as reporters noticed, there was no such language included for other elements of the bailout. Some provisions of the bailout are particularly beneficial to businesses like Trump’s. There is no evidence that any provisions in the bailout were written specifically to benefit the president. It’s also not known whether the Trumps will seek such aid. (Cramer, 4/8)
NBC News:
Retail Has Been On Life Support — Coronavirus Could Pull The Plug
With hundreds of thousands of stores closed nationwide, the coronavirus pandemic is accelerating dramatic changes across the retail industry that had been underway well before the viral outbreak hit the U.S., according to analysts. "Retail has been on life support," said Ian Ross, principal of the commercial real estate investment firm Somera Road. "Dozens of these companies were on the verge of financial collapse, and I have a hard time believing they're not going to collapse because of this." (Miranda, 4/7)
