Unsanitized: The COVID-19 Report for June 25, 2020

Sen. Ben Cardin on Boosting Small Business Support.
Plus, the unending first wave.

 

Sen. Ben Cardin (D-MD) wants to reserve unused PPP funds for additional
funding for small business. (Kevin Dietsch/Pool via AP)

First Response

First-time unemployment claims held steady

last week at around 1.5 million, three months after the beginning of the
crisis. Over 31 million Americans are still receiving some form of
unemployment with just a month to go until the expanded $600/week boost
ends. The Census Household Pulse Survey
shows large expected
losses in income coming, along with high food and housing insecurity.
More worryingly, small business revenue is showing signs of taking a
step back
in June, and that's before the full impact of rising cases. States
don't need to be formally locked down for people to just stay inside
because they fear the coronavirus.

This all comes as a June 30 deadline for applications for the Paycheck
Protection Program (PPP) rapidly approaches, with $130 billion still
left to hand out. It seems unlikely that all that money will fly out the
door in the final few days, or that Congress will pass legislation to
extend the deadline before the end of the month. So what happens to that
money, which Congress intended to go to keep workers on payrolls?

Sen. Ben Cardin (D-MD) is the ranking member of the Senate Small
Business Committee, and he has been working with a small bipartisan
group-committee chair Marco Rubio (R-FL), Jeanne Shaheen (D-NH) and
Susan Collins (R-ME)-on where to go next. "We want to make sure the
money [left over] is reserved for small business," Cardin said in an
interview with the Prospect. "The first round of aid for those that
followed the rules, their time has expired or will be expiring shortly.
It's time for us to act."

Cardin's legislation
,
which he's already introduced with Shaheen, would extend the
application period (or at this point, restart it) to at least December
30, giving the Small Business Administration the authority to go beyond
that if necessary. And it would build in a second round program for
companies that already got a forgivable loan and still need support, if
their revenues remain well below the norm. Cardin thinks that money
would be focused on smaller firms and those that rely on large
gatherings of people or visitors traveling from around the country, like
hospitality and tourism, catering, entertainment venues, and the like.

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It's been difficult for the committee to understand where the PPP fell
short or where it could be targeted in the future because of the lack of
transparency around the program. "We were not getting good information,
we have been flying in the dark as far as understanding where the money
is going." In addition, the continual changes to the program made it
hard for business owners to understand if the program worked for them;
another round of changes designed to make the funding more flexible just
passed a couple weeks ago. Changes to an eligibility rule

to let formerly incarcerated small business owners access funds just
happened this week.

Inability to get smaller businesses what they need to survive will have
ripple effects on local property taxes, as I discussed yesterday
.
Economic Injury Disaster Loans, which were also expanded in the CARES
Act, have been unsuccessful in rescuing very many businesses. "I think
there's been a bipartisan response, small businesses are the growth
engine of the economy, job creation and innovation," Cardin said. He
praised businesses who have figured out creative options to find
customers and get them goods and services, through home delivery or
other means. (This is one reason I think Amazon just got a bunch of new
competition
.)

"If we don't save these small businesses," Cardin said, "it'll be a
harder recovery for the economy."I asked Cardin about another June 30
deadline, the Trump administration ending federal support

for testing sites in areas of the country like Texas, which has
lawmakers in both parties

angry. "We're still in triage, in the first wave of the pandemic,"
Cardin replied.

"This is not the time to slow down. We have not even close to enough
testing to safely reopen the economy." He noted that he has talked to
health care providers on the verge of closing and nursing homes without
enough protective equipment. And he stressed the need to transition to
insourcing manufacturing of critical goods. "I hope we learned that we
not only need a better stockpile but a domestic supply chain," Cardin
concluded. "We need to work on that now to ensure it for the future."

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South by Southwest

So you probably heard that U.S. cases were at a daily high

yesterday. I think everyone will agree that this is a high for positive
tests, not infections; we're testing at much higher levels now than in
March or April, so we actually know a little more about the universe of
those with COVID-19. But the methods we were supposed to put in place
while locked down are completely failing us. Contact tracing in Austin,
Texas, now a hotspot, isn't working
,
because there are too many people moving around. You can contact trace
10 or 20 people but when it gets to 100 for each case and there are a
thousand cases a day, it's unmanageable.

Elective surgeries have been shut down again

in Texas, and Florida's governor has threatened to take business
licenses away

from those not practicing social distancing. Cities and counties like
Palm Beach are mandating mask wearing, leading to this epic county
commission hearing
,
with one woman managing to impressively shoehorn 5G, Bill Gates creating
the rona, Pizzagate, QAnon, and the "deep state" into one two-minute
comment. The force is strong in that one.

Marco Rubio was more pithy: "Wear a damn mask
."

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Days Without a Bailout Oversight Chair

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90
.
Ninety days and nobody is running the main oversight authority on the
bailout. I'll bet Tim Geithner is kicking himself
over this!

We Can't Do This Without You

Today I Learned

* No delegates at a mostly virtual Democratic National Convention
.
(NBC News)

* Enormous news about cracks in the wall

upholding the legislative filibuster. Top Biden ally Chris Coons says he
won't let post-pandemic initiatives be blocked. (Politico)

* New York City halts all major capital infrastructure projects
.
(The City)

* Dean Baker is more optimistic than I am

but always interesting on the post-pandemic economy. (CEPR)

* The lost years in schooling

will particularly hit hard. (Axios)

* Amazon approved

to get in on the food delivery game, with a stake in Deliveroo.
(Competition Policy International)

* A giant brush fire-causing fireworks display

at Mount Rushmore is just what we need. (Washington Post)

* I have been to Lopburi, a town that has monkeys like major cities have
pigeons. They've turned ornery without tourists to give them bananas
and have taken over the city
.
(The Guardian)

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