Trump Says U.S. ‘Quickly’ Running Out of Money on Small Business Loans

Date: 2020-04-07 19:49:16

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“We’re running out of money, which is a good thing in this case,” President Trump tells finance CEOs during a phone briefing on small-business loans. #Coronavirus #Covid19 #CoronavirusUS

The Treasury Department is asking Congress for $250 billion more to aid small businesses, and Senate Majority Leader Mitch McConnell said the Senate could act as soon as this week to pass additional funding.

Treasury Secretary Steven Mnuchin said in a tweet that he’s spoken with McConnell, Senate Democratic leader Chuck Schumer, House Speaker Nancy Pelosi and House GOP leader Kevin McCarthy about quickly securing the money.

Businesses have rushed to tap the $350 billion Paycheck Protection Program that was part of the massive $2.2 trillion stimulus passed by Congress in response to the economic crisis spawned by the coronavirus pandemic.

Stay-at-home orders across the country have particularly squeezed small businesses, which account for almost half of U.S. private employment.

McConnell said the Senate could approve more funding for the program during Thursday’s pro-forma session by voice vote or unanimous consent. That would avoid forcing all members to travel to Washington, but an objection from a single senator would cut off that option.

“Congress needs to act with speed and total focus to provide more money for this uncontroversial bipartisan program,” McConnell said Tuesday.

Read More: Senate Democrats Propose Hazard Pay for Essential Workers

Pelosi said she supported providing additional funding but didn’t commit to seeking quick approval without additional conditions.

That program “needs money right away, we know that,” she said on CNN. But she said the government doesn’t have data so far on who is receiving the money.

“We want to make sure that the program is administered in a way that does not solidify inequality in how people have access to capital, but instead a benefit to everyone who qualifies for it,” Pelosi said. “So we have certain considerations if we need to go forward with that.”

McCarthy said that he had spoken to Mnuchin and would support a request for additional money for the small business programs, saying that the House should act “swiftly” on the request.

Pelosi previously called for an extension of the PPP program as part of a next round of stimulus that also would include an unemployment insurance extension, more direct payments and relief for states and localities. She has estimated the bill would cost at least $1 trillion.

Republicans have thus far been reluctant to enact a wide-ranging phase four stimulus bill. Now that they and their core business supporters such as the U.S. Chamber of Commerce are demanding an infusion for PPP, Democrats could have leverage to obtain more unemployment insurance and direct payment for workers. Pelosi would have to weigh such an opportunity against the political costs of delaying aid to small businesses.

Read More: Fed to Provide Financing for Small-Business Stimulus Loans

Schumer on Tuesday unveiled his own plan for a next stimulus package. It would include massive “Heroes Fund” to give hazard pay of up to $25,000 each for workers including grocery store employees, transit workers and pharmacists who are risking their lives to stay on the job amid the coronavirus outbreak. That is also likely to have a price tag in the hundreds of billions of dollars.

GOP Senator Marco Rubio, chairman of the Small Business Committee, said he asked Mnuchin to make a formal request for at least $200 billion more for the program as soon as possible.

“There is a critical need to supplement the fund to ensure America’s more than 30 million small businesses will be able to access this critical lifeline,” he said in a statement.

White House Economic Adviser Larry Kudlow said on Fox News on Tuesday morning that as of Monday evening, about 178,000 loans for $50 billion had been processed. That amount hasn’t been given to businesses yet but rather is the value of loans SBA has registered and guaranteed for lenders to complete the process and disburse funds, according to a senior administration official.

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