This week’s podcast: Banking on inequity

Congress spent hundreds of billions of dollars to rescue small businesses hurt by the pandemic. But Paycheck Protection Program money disproportionately went to White neighborhoods, leaving communities of color behind.

We analyzed more than 5 million PPP loans. Here’s what we found. 

Amid the chaos of the COVID-19 pandemic last spring, the federal government debuted one of the largest financial bailouts since the Great Depression. The Paycheck Protection Program has given more than $770 billion in forgivable loans to businesses all over the country since last April.  

For many companies, the money was crucial for keeping workers employed when business as usual came to a sudden halt. But in a new investigation, we found that racial disparities have plagued the program. 

We looked at how neighborhoods connected by one street in Los Angeles – Manchester Boulevard – fared with PPP loans:

• In Playa del Rey, a census tract that is majority White, 61% of businesses received PPP loans. 

• In a majority-Asian corner of Monterey Park in the LA area, about a third – 37% – of businesses received PPP loans. 

• In one corner of Inglewood, which is majority Black, 32% of businesses got PPP loans. 

• In a predominantly Latinx stretch of South Los Angeles, 10% of businesses received PPP loans.

These striking disparities were part of a national pattern. In the vast majority of metro areas with a population of 1 million or more, the rate of lending to majority-White areas was higher than the rates for any majority-Latinx, Black or Asian areas. 

Why did this happen? Read the full story, which was co-published on the front page of the Sunday Los Angeles Times: Rampant racial disparities plagued how billions of dollars in PPP loans were distributed in the US

Donate $50 today and we'll send you a copy of In/Vulnerable, our comic book about inequity in the time of a pandemic.

Which neighborhoods in your city were neglected by the Paycheck Protection Program?

After successfully suing the federal government for detailed PPP data along with other news organizations, we wanted to know if there were racial disparities in how these loans were distributed. Finding this out was tricky because the government did not initially include a demographic questionnaire in the PPP application. That meant banks did not consistently keep track of data on the race and gender of borrowers. 

So data reporter Mohamed Al Elew looked at PPP loans by census tract. He compared the racial makeup of each census tract across the country to the total number of loans in that area, as well as other business data, to determine which neighborhoods were helped and which were left behind. Reveal’s analysis is the first-ever look at how PPP loans were distributed at the census tract level nationwide across racial groups. 

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Maria Feldman is director of operations at Reveal. She focuses on overseeing the office, technology infrastructure and business solutions. And also taking care of her snuggly dog, Walter. 

Listening: I've been listening to really upbeat pop music lately. Dua Lipa's album has been on repeat, but also Elton John's greatest hits – anything that keeps me humming throughout the day. 

Reading: I'm a baker at heart, and I've been reading a lot of great recipes lately. One I'm excited to try is for orange-almond bostock – it's kind of like a croissant meets brioche. 

Watching: I've been obsessively rewatching “The Nanny” since it was added to HBO Max in April. I loved the show as a kid because Fran Fine seemed so glamorous, cool and loved Barbra Streisand as much as I do. Watching as an adult is great because it's actually wittier than I noticed before.

This newsletter is written by Sarah Mirk. Have any feedback or ideas? Send them my way.