$2 Trillion Stimulus Stumbles Out Of The Gate As Trump Administration Fumbles Delivery
The Trump administration announced Friday that the government is struggling to move forward with new policies to reduce the economic devastation of the coronavirus pandemic. The news comes as the national unemployment rate has risen faster than it has in decades.
Congress last week authorized unemployment benefits, $1,200 payments to American households and billions of dollars worth of forgivable business loans meant to stave off layoffs. However, none of those policies has taken effect, to the frustration of their intended beneficiaries.
President Donald Trump and Treasury Secretary Steve Mnuchin said the so-called Paycheck Protection Program ― which will allow small business owners to ask banks for government-funded loans that would cover payroll costs and be fully forgiven if the company avoids layoffs for eight weeks ― would launch Friday. But, according to the Huffington Post, the nation’s biggest banks said they weren’t ready, and several business owners told the news outlet on Friday that they weren’t able to apply for the loans.
“It’s a lot like banging your head in to a wall and not getting anywhere,” said Scott Cavendish, owner of a craft brewery in Gastonia, North Carolina. “We reached out to four separate banks and all we get is, ‘If you’re interested, put your email here and we’ll contact you.’”
Meanwhile, the rebate checks coming to most Americans will take at least two weeks to land in bank accounts ― but that’s only for people who have filed a federal tax return in the last two years. Most people who haven’t filed recently will have to do so, but many have encountered glitches with online software that won’t let them file if they’ve had no taxable income.
Democrats are pressing the Trump administration to issue guidance to states on how to implement the bigger unemployment benefits to people who have lost jobs due to the pandemic. They also want states to rapidly expand access to the benefits by hiring more people to process claims, as several states have reported record levels of claims that have choked access to phone lines and websites.
“The administration must do more to get this support for workers and businesses as soon as possible,” Sen. Ron Wyden (D-Ore.) said Friday on a press call. “We’re learning people won’t get [$1,200 rebate checks] for months. … We won’t let that happen when it comes to unemployment insurance.”
“It’s gotta be quick. We don’t want a big bureaucracy,” Senate Minority Leader Chuck Schumer (D-N.Y.) on the call with reporters.
The development comes as millions of Americans are sitting at home without paychecks, and wondering how they’ll pay for food or rent.
As for the Paycheck Protection Program, the biggest bank in the U.S., JPMorgan Chase, said it needed more federal guidance before it would take applications. The second biggest, Bank of America, said it would only take applications from existing customers who had multiple accounts.
But Schumer sounded an optimistic note, saying he’d heard from several banks that they’re ready to go.
“We’re pushing them to go as quick as possible because businesses are teetering on the brink,” he said. “Speed is of the essence here. Making sure the banks move quickly and getting [the Small Business Administration] to work with the banks is vital. I think many, many banking institutions are very eager to be involved here.”