Today’s topic is on saving small businesses impacted by the
lockdown.
In a word, don’t. Please
stop. Don’t do any more, for God’s sake.
Congress and the experts have done far too much
damage already. Everything they plan to do
going forward is just going to make things much, much worse and squander
billions needlessly.
Here’s why: if the goal is to save laid off employees from
going broke, we’ve already done that.
The cash payouts to every American, plus the ridiculously boosted
unemployment comp, are putting more money in a lot of people’s pockets than
they’ve seen when they were working.
If the goal is to save small businesses from going broke
that ship has sailed. Not only that, but
labor is usually the biggest expense for small businesses – if they’ve laid off
their employees, they don’t have that expense anymore. That’s why, for the life
of me, I cannot understand why the clowns in government and especially in
Congress are so enamored of the Payroll Protection Plan designed to cover
payroll expenses for small businesses.
Hello? Those
employees aren’t on the payroll anymore, are they? No, they were laid off and
are now collecting unemployment comp.
And, BTW, doing better financially.
So if you boil this down, the government wants to give loans
to small businesses to cover their payroll during the lockdown and if they keep
their employees on their payroll, even though they have no work for those
employees and those employees aren’t allowed to come to their workplace anyway,
the loan becomes an outright grant.
Have you spotted the logic problem? Why can’t Congress? Or
Trump, for that matter?
It's classic circular stupidity. Something you’d expect from
Democrats, but no, Republicans are not only pushing this, too, but want to add another
$250 billion to this boondoggle, because there’s been such a demand for the
loans. (The initial $350 billion is
almost gone.)
Of course, small businesses – and I use that term loosely as
you’ll see – are fighting to get those loans and whining and bitching about how
hard they are to obtain.
You see that on the news every night. Small businesses want
to stay open and keep their employees, but the government and the banks are
standing their way. The heartless bastards.
Many banks are requiring “business” owners to prove they
have a business to get a loan – like a tax ID or EIN. Some banks are giving a higher priority for
processing applications to customers with whom they already have a
business-banking relationship. How dare
they …
Oh the humanity.
It’s so restrictive that Nancy Pelosi said recently that in
the “next” coronavirus stimulus package she wants to loosen the rules so people
with no business history, those not knowledgeable enough to complete an
application, volunteer clinics, and nonprofits could also qualify for the loans
without going through the full vetting process.
(Planned Parenthood is technically a nonprofit, BTW.)
The other day the WSJ had an article on the hold up in loans
and one of the examples was a small business owner complaining how she spent
the entire morning going from bank to bank and no one was willing to help
her. Her business? She has a startup with 6-8 employees that
helps other organizations make their websites more accessible for the
disabled.
As a lender what would give you pause? It’s a startup? It’s not actually a real
business? Don’t those capabilities already
exist – for free – in practically every major web browser? Her startup is likely not producing an income
yet, and probably isn’t planning to?
Geez, I don’t know. I wouldn’t lend money to her. That’s just me.
But she heard banks were giving out money. Why couldn’t she
get some?
That’s the attitude. And never let it be said that a bad
idea can’t be made worse by politics.
Democrats and Republicans are floating the idea for a program
that would cover all payrolls – for people earning up to $100,000 a year –
until the lockdown is ended, which, according to the supposed experts in DC,
could last until 2023.
I did not make that up. It’s in today’s WSJ.
I have a much better and less costly set of ideas.
First, end the lockdowns and let most healthy people go back
to work. Reopen the schools. At this
point, some say from 20-50% of us already have been exposed and either not
developed any symptoms or automatically recovered. It’s also clear that the
virus isn’t as deadly for everyone. People
really at risk – those with underlying health issues – can be quarantined until
there’s a real vaccine more easily than a whole freaking country.
In the meantime, everybody else can wear masks, keep up social
distancing, wash their hands frequently, keep hand sanitizer and disinfecting
wipes handy and go about their daily lives. We’ve been doing it for a couple of
months already. If someone then displays symptoms of the
virus, put them in quarantine and test everybody around them. That’s not that
hard.
Next, stop the handouts. Period. No more free anything. No more bullshit giveaways to every scammer, wannabe
do-gooder, whining governor, industry group, and corporate weasel with their
grubby paws out. More importantly, don’t
print any more money to fund every elected or unelected government employee’s
wet dream of as utopian society. Put in realistic sundown clauses, like cutting
off funding in two months, in all the programs already passed.
If any Senator or Representative fights this, remember it
when they come up for reelection and vote their ass out. Now that I think about
it, vote them all out. All of them. They shouldn’t be in office, any of them,
anymore, after this shameful and reprehensible episode.
They’re the reason for all the new demands for additional bailouts
and giveaways. They are the reason why
we’re already spending $2.2 trillion to pay people not to work. Why we are
grossly overreacting to a “pandemic” that so far is less deadly than our normal
seasonal flu. Why we’re using this event
to push bigger government and socialist programs we don’t need and can’t
afford. And why we are spending billions
– yes billions – to fund favored businesses and other groups that have nothing
to do with combatting the virus. And they’re dreaming up new ways to spend even
more.
They need to be stopped.
In reality, we shouldn’t bail out anybody, especially not
those we always seem to be bailing out – like the auto companies, the airlines,
the banks – and this time most certainly not the cruise lines registered
elsewhere to avoid our taxes. Bailing them out won’t save jobs – they’ve
already laid off most of their employees already, and we’re giving those
employees unemployment benefits.
Every time we’ve bailed out some business or industry in the
past they’ve just used our money to boost profits and enrich their top
dogs. Screw them.
While we’re at it, there’s absolutely no need to save “small
business”; the small businesses that were going to make it have been working
through all this anyway, without government assistance. The landscapers. The home remodelers. The auto repair shops. There are a lot of people out there who have been
working, and a lot of people hiring and paying them.
Today, for example, we had somebody install solar tubes
in our house. Our next door neighbor had granite countertops installed today.
Last week another neighbor had solar tubes put in. Yet another neighbor has had a major construction
project going on at their home for several months. Obviously, a lot of small
businesses are still operating and paying their employees.
Outside the cities featured every night on the news, the
rest of the country has still been quietly working, unless some bureaucrat
forced their employer to close. Those of
us outside those cities all know this. For some reason, nobody in DC seems to
be aware of this.
Truthfully, and coldly, a lot of small businesses aren’t worth
saving; most have already cut all their employees, and sadly, most were already
going to fail sooner or later with or without the pandemic. Sure, we have heart for the woman who started
a company with her mahjong group to make yarmulkes for dachshunds, or the guy
who started a business with friends to breed exotic salamanders, but they’ll
probably fail. Giving them loans to prop them up now is like
giving a ventilator to a 105-year-old, 3-pack-a-day smoker with emphysema and advanced
heart disease just diagnosed with COVID-19 – it may make you feel good but it’s
pointless.
If we want to get the economy – and actually the country –
back we need to stop the politicians and DC experts from making it any worse.
If only we could lockdown all of them for a month or two …
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