As economic aid talks between Republicans and Democrats and PPP stalled late last week, President Donald Trump released a series of executive actions in an attempt to create faster economic growth in the coming months.
His actions included a $400-a-week bonus payment, an eviction moratorium, and a delay in payroll tax liability for low- and middle-income workers. President Trump’s executive orders, according to experts, can’t alone generate enough funding to address COVID’s impact on the economy, and significant Congressional spending will be needed to supply full funding.
The federal government’s Paycheck Protection Program (PPP), which allowed businesses to preserve jobs, injected $523 billion into the economy, allowing small-business owners to stay afloat. The program expired over the weekend, and last week the government reported that nearly 1.2 million Americans were added to the unemployment tally that economists estimate at 30 million Americans currently.
Currently around $3.7 trillion has been injected into the economy by the U.S. Government according to Forbes.
Lawmakers are considering extentions to PPP, including letting companies whose sales have fallen by 35% or more get a second loan. Other considerations according to the New York Times are:
Expansion of low-interest loans offered by the Small Business Association (SBA);
Increasing tax cradits for companies that increase workers;
Bailouts for especially-hard-hit industries.
Last week the SBA began accepting applications from banks to have small-business loans forgiven.
A recent economic analysis by MIT concluded that the PPP preserved 1.4 million jobs through early June, with more than five million companies receiving loans averaging $102,000 each, and approximately half of American non-government jobs employed by small businesses.
States to pay a share?
Under president Trump’s order, the federal government is requiring states to pay for 25% ($100) of the potential $400 benefit per person in weekly aid. According to CNN, states must also “agree to enter into this financial agreement with the federal government for any unemployed person living there to get any of the additional benefits.”
How states will afford the extra cost is undetermined as many states have previously petitioned the government for financial assistance to the tune of $500 billion according to CNN.
President Trump’s memorandum also directed the U.S. Education Department to extend student loan relief granted in the CARES Act until Dec. 31. Loan payments are currently paused with interest suspended on federally-held student loans until Sept. 30.
In March, President Trump waived student loan interest by executive order and said borrowers could request a deferment on their payments, which later Congress put into law and automatically suspended monthly payments.
The current sticking point of the latest relief bill is Democrats aiming for approximately $3 trillion in relief while Republicans are aiming for something below $2 trillion.
Remaining small business relief
In addition to traditional SBA funding programs, the CARES Act established several new temporary programs for small businesses to address the COVID-19 outbreak:
- Paycheck Protection Program
- EIDL loans
- SBA Express Bridge Loans
- SBA Debt Relief
For more info go to: sba.gov/funding-programs/loans/coronavirus-relief-options.
For additional COVID relief resources for chiropractors go to chiroeco.com/coronavirus-covid-19.