Did you know? The Patriot Post is funded 100% by its readers. Help us stay front and center in the fight for Liberty and support the 2022 Year-End Campaign.

Nate Jackson / April 22, 2020

More Money Coming, but Will Small Businesses Get It?

Big banks seem to have prioritized big businesses in allocating forgivable PPP loans.

A longrunning story during the Great Coronavirus Shutdown has been the efficacy (or lack thereof) of the Paycheck Protection Program (PPP), the $350 billion portion of the CARES Act for the Small Business Administration (SBA) to back loans for small businesses to keep more Americans on the payroll. That money was a smaller part of the massive $2.2 trillion “phase three” aid package. All told, Congress has approved roughly $3 trillion in coronavirus aid, with perhaps almost that much more to come — all on top of a 2020 budget that was already approaching $5 trillion. Staggering.

First, we’ll tackle the political wrangling. After two weeks of Democrat obstruction over unrelated demands, Congress authorized another $321 billion for the PPP and yesterday the Senate passed by unanimous consent a total package of $484 billion. The House will vote Thursday.

“I am just sorry that it took my colleagues in Democratic leadership 12 days to accept the inevitable,” Majority Leader Mitch McConnell said Tuesday. “They shut down emergency support for Main Street in a search for partisan ‘leverage’ that never materialized.”

Actually, some of that leverage did materialize. Republicans gave up on a “clean bill” of only PPP funding, while Democrats won roughly $160 billion in totally unrelated money for hospitals and testing (hence the dollar discrepancy above), even if they failed to secure more bailout money for state governments.

Second, we’ll note the bigger story: Who’s getting the money.

The PPP ran out of money last week after processing “14 years worth of loans in less than 14 days.” The Dispatch reports, “According to Treasury Department data, 1,661,367 loans — 74 percent of which came in at $150,000 or less — were approved by 4,975 different lenders. The average loan disbursed was $206,000.”

Why did the money disappear so quickly?

A significant part of the answer is something we pointed out right from the beginning: Some relatively big businesses gobbled it up.

According to the Associated Press, at least 94 publicly traded companies received aid, and some have “market values well over $100 million.” The Wall Street Journal reports it was more than that, adding, “Twenty of the 103 [publicly traded] companies employed more than 500 people.” Those big companies raked in big cash, too.

When most of us think of small businesses, we think of the mom-and-pop shops around town that employ a relative handful of people, not publicly traded chains. Businesses employing 100 or fewer workers constitute 98% of firms and account for roughly 50% of the workforce. Yet because the SBA considers any operation with 500 or fewer to be “small,” most of the PPP money went to fairly sizable operations that perhaps weren’t as desperate for cash as the little guy.

The law was supposed to distribute money on a first-come-first-served basis. But big banks seem to have shuffled big customers to the front of the line — leaving small businesses at the back — as alleged in class-action lawsuits filed against Bank of America, JPMorgan Chase, U.S. Bank, and Wells Fargo. When truly small businesses did succeed in obtaining loans, it was through smaller community banks. (Democrats claim to have added stipulations specifically allocating $60 billion of new funding to small banks.)

By contrast, individual relief payments were prioritized for those with the lowest income. It certainly seems like it would have been prudent to do likewise for truly small businesses.

All this said, it’s important to note that this isn’t to distinguish between the workers whose jobs were saved. An employee of a bigger company needs that job every bit as much as the one working in a small store front. It is simply to say that too many small businesses in critical condition ended up being left out while some of the bigger fish were fed.

Update 4/24: National Review reports, “The Treasury Department said Thursday that it was asking approximately 150 publicly traded firms to repay nearly $600 million in loans they received from the federal program designed to help small businesses cover expenses and payroll amid the coronavirus pandemic.”

Start a conversation using these share links:

Who We Are

The Patriot Post is a highly acclaimed weekday digest of news analysis, policy and opinion written from the heartland — as opposed to the MSM’s ubiquitous Beltway echo chambers — for grassroots leaders nationwide. More

What We Offer

On the Web

We provide solid conservative perspective on the most important issues, including analysis, opinion columns, headline summaries, memes, cartoons and much more.

Via Email

Choose our full-length Digest or our quick-reading Snapshot for a summary of important news. We also offer Cartoons & Memes on Monday and Alexander’s column on Wednesday.

Our Mission

The Patriot Post is steadfast in our mission to extend the endowment of Liberty to the next generation by advocating for individual rights and responsibilities, supporting the restoration of constitutional limits on government and the judiciary, and promoting free enterprise, national defense and traditional American values. We are a rock-solid conservative touchstone for the expanding ranks of grassroots Americans Patriots from all walks of life. Our mission and operation budgets are not financed by any political or special interest groups, and to protect our editorial integrity, we accept no advertising. We are sustained solely by you. Please support The Patriot Fund today!


“Our cause is noble; it is the cause of mankind!” —George Washington

The Patriot Post is protected speech, as enumerated in the First Amendment and enforced by the Second Amendment of the Constitution of the United States of America, in accordance with the endowed and unalienable Rights of All Mankind.

Copyright © 2022 The Patriot Post. All Rights Reserved.

The Patriot Post does not support Internet Explorer. We recommend installing the latest version of Microsoft Edge, Mozilla Firefox, or Google Chrome.