Here's what’s in the $2 trill. coronavirus stimulus deal for business

dublinbay z6 (KS)

"Early Wednesday morning, Senators Mitch McConnell and Chuck Schumer announced a massive $2 trillion stimulus deal set to be the largest economic stimulus package in modern American history as it faces the novel coronavirus outbreak.

"This is a wartime level of investment into our nation," McConnell said.

The deal is set to include a range of far-reaching provisions. Everything from $1,200 government checks for individuals to hundreds of billions of dollars to fight the crisis are included.

But the most contentious part of the negotiations were clearly provisions to send over half a trillion dollars directly to impacted businesses.

[. . .]


For the airlines a ‘special provision’

“We're going to back the airlines 100%,” President Trump said last week about one of the industries hit hardest by the ongoing crisis.

The deal reportedly includes $50 billion specifically for passenger airlines, $8 billion for cargo airlines, and $17 billion “for firms that are deemed important to national security.”

[. . .]

Either way, the airlines were singled out for special treatment because “airlines do provide significant resources and national security issues,” Mnuchin said Monday, adding, “I believe that's something that's very important to Americans.”

Billions more for businesses

Other impacted industries, from the cruise industry to hotels to restaurants, have a range of ways to get government cash.

Previous stimulus efforts put $50 billion aside for the Small Business Administration. That “money's already starting to be approved,” an SBA official told Yahoo Finance last Friday.

This deal ramps things up aggressively with hundreds of billions of dollars in loans now expected to be available in the coming weeks and months.

[. . .]

“This is not a program where you are going to the SBA, you are not going to a tent somewhere in a disaster area or some government office or some government website,” he said on the Senate floor over the weekend. “You are going to a bank, to a financial institution.”

The banks will then, according to the plan, be able to process cash assistance quickly, either through the SBA or through a new program that will be set up specifically to administer some of this money. The deal reportedly includes a $367 billion fund for the small business loan program as well as a $500 billion fund for a new lending agency.

What’s still a bit of a mystery is exactly how this new lending agency will work. Sen. Pat Toomey (R.-PA) has been a central negotiator on this portion of the package and gave some insight into how this “big credit facility” will work on Sunday on NBC.

He said the facility will have two components: One will be administered by the Treasury Secretary with direct loans for a short list of “seriously distressed and absolutely essential companies,” likely including airlines.

The second component will be much bigger and be “a broad-based credit facility that will be available across categories, across sectors and industries.” Toomey said this program will give loans that will have to be repaid. “None of this is grant money,” he said.

Businesses of all sizes, many of which are facing the prospect of bankruptcy, will be able to participate in the different programs.

This idea of a separate lending program — outside of the SBA — was also championed by Sen. Mark Warner (D-Va.). In a recent Yahoo Finance interview, he noted that a second loan authority would allow more businesses to participate. In the past, he says, "there were all these well-intentioned programs but there was so much funding bureaucracy and underwriting that there was no take-up rate."

There is also expected to be a crucial change in how at least some of these loans will work. Some of these loans appear set to eventually be forgiven and effectively become grants.

“They are going to be able to take an SBA loan that will give them two months of payroll and some overhead,” Mnuchin said on Fox Business on Monday. “And if they hire the workers back or they keep their workers hired, the government will forgive that loan.”

Provisions to ban stock buybacks

A lot of that cash, especially from the new lending facility, will find its way into a range of publicly-traded companies. The deal includes provisions to stop these companies from using that cash for stock buybacks or executive bonuses.

"Every loan document will be public and made available to Congress very quickly so we can see where the money is going," Schumer said Wednesday on the Senate floor. A condition for receiving a government loan will be that a company cannot make stock buybacks for a year.

The oversight provisions include a new inspector general position focused on oversight of these funds along with a five-person congressional panel. . . .

[. . .]

Schumer’s office said the deal will “prohibit businesses controlled by the President, Vice President, Members of Congress, and heads of Executive Departments from receiving loans or investments from Treasury programs.”

Other stimulative measures

Hundreds of billions more dollars in the deal will also indirectly flow to businesses. First and foremost, lawmakers hope that the $1,200 checks will be spent across a range of industries.

The deal also includes a massive expansion of unemployment insurance. Schumer called the agreement "unemployment compensation on steroids," and said the maximum unemployment benefit will be increased by $600 per week to ensure “that laid-off workers, on average, will receive their full pay for four months.”

The plan also includes a massive infusion of cash into the health-care industry. Health care providers, community health centers, and hospitals are set to receive over $130 billion to fight the virus while states and localities are set to receive another $150 billion."


https://www.yahoo.com/finance/news/coronavirus-2-trillion-stimulus-deal-for-businesses-080739448.html

--------------------------------

Hope that helps.


Kate

SaveComment32Like1
Comments (32)
Thank you for reporting this comment. Undo
queenmargo

I hate to break it to you, but without business there would be no jobs.

Save    
Thank you for reporting this comment. Undo
Nana H

Is someone suggesting that business should not receive financial help?

3 Likes Save    
Thank you for reporting this comment. Undo
dublinbay z6 (KS)

Queen, Was anybody arguing otherwise? If so, I missed it.

How about commenting on stimulus deal Congress is passing? See OP--if you missed it.

Kate

1 Like Save    
Thank you for reporting this comment. Undo
Kathy

It’s really unnerving to producers there are no workers to produce their profit making products. Without workers factories cannot produce.

3 Likes Save    
Thank you for reporting this comment. Undo
Iris GW

I appreciate the Democrats for holding out for more help for the little guys and accountability for the big guys.

5 Likes Save    
Thank you for reporting this comment. Undo
paprikash

Haven’t read it yet but have the feeling the dem “improvements” may not be improvements at all

1 Like Save    
Thank you for reporting this comment. Undo
vedabeeps

Haven’t read it yet but have the feeling the dem “improvements” may not be improvements at all


I have read it and I disagree. I think preventing corporations from using it for stock buy backs and CEO/Exec bonuses is an important improvement.

10 Likes Save    
Thank you for reporting this comment. Undo
paprikash

That’s fine — I’m wondering about the Kennedy Center, screwing Trump employees, things like that...

Save    
Thank you for reporting this comment. Undo
vedabeeps

I haven’t seen anything that says Trump employees can’t file for unemployment like everyone else. Can you provide links?

3 Likes Save    
Thank you for reporting this comment. Undo
maifleur03

I find it interesting that the airlines will receive money but the small businesses will need to take out loans. One news story from earlier today mentioned some provision actually hurt workers.

2 Likes Save    
Thank you for reporting this comment. Undo
vgkg (Va Z-7)

Congress relies heavily on the airlines as they around fly a lot and don't like inconveniences, with small businesses not so much interaction so who cares.

1 Like Save    
Thank you for reporting this comment. Undo
paprikash

One news story I heard was that all employees working for any company where Trump or anyone in Congress has a stake would be treated differently from those employees not connected to our electeds. I’m off to google because I really heard this on TV when I was in another room of my mansion so I don’t know who said it.

Save    
Thank you for reporting this comment. Undo
Kathy

School employees in Florida cannot claim unemployment because they can sill work. DeSantis did not declare a Shelter In Place statewide. He said counties or cities who want to can do it, so only a few have.

Teachers are doing online, bus drivers are cleaning classrooms, kitchen employees are cleaning cafeterias. When that’s done it will prob be over for the school year.

I don’t know that affects other workers whose jobs are shut down unless their employer laid them off so they can collect.

Save    
Thank you for reporting this comment. Undo
Nana H

What I heard was the company could not avail itself of the corporate bailouts but the employees were entitled to the federal benefits

Save    
Thank you for reporting this comment. Undo
Kathy

If you had a direct deposit tax return in 2018-or 2019 you supposedly will get the stimulus quickly. If not it hasn’t been determined how they will disperse the money.

Save    
Thank you for reporting this comment. Undo
live_wire_oak

I’m confused. Bernie is the socialist? Not the Republicans? As long as people get theirs in their coffer, sham ideology doesn’t seem to matter. Aren’t governmental support checks to businesses or individuals a thing that America is supposed to run from? Where are the smug Darwinian capitalists? Why aren’t they rigidly refusing to allow this to happen? Don’t they have any principles?

Shouldn’t the “woefully unprepared” grasshopper airline be allowed to fail? Shouldn’t the sole proprietor tax accountant ant refuse to share? Should Aesop even be allowed to grab a portion to redistribute to the grasshopper?

Is socialism not so bad after all? As long as the big businesses get theirs?

10 Likes Save    
Thank you for reporting this comment. Undo
be happy

It makes no sense that so many people who have had no impact are going to get checks. It makes no sense that huge corporations that waste so much are going to get bailouts. Yes some of them do need to fail and then maybe others would learn the lesson that they need to have reserves.

live_wire-oak - Their principles went out the window, they all only care about getting votes in the next election.

Save    
Thank you for reporting this comment. Undo
Kathy

The word Socialism is never used when it applies to big business and corps. They are called incentives. US is a consumer society. If consumers don’t/can’t purchase, the economy stops. They are throwing out money hoping people start buying soon. If they spend it on rent, mortgages or save it, it will be for naught. Everytime this happens it is big business lobbyists that make the deals while workers have to rely on legislators working in their behalf. Too many of them are on the take from lobbyists.

Save    
Thank you for reporting this comment. Undo
mrskjun(9)

Just think how important the Kennedy Center is compared to small businesses. 35 million still in this bill. This is disgusting.

1 Like Save    
Thank you for reporting this comment. Undo
Nana H

What's with the Kennedy Center thing ? Mrs, is Trump disgusting?

"President Trump on Wednesday defended the inclusion of $25 million in funding for the Kennedy Center as part of the massive economic relief bill aimed at boosting small businesses and workers harmed by the fallout of the coronavirus.

Trump fashioned himself a supporter of the arts, arguing the John F. Kennedy Performing Arts Centeris deserving of assistance given its inability to put on shows as officials ban large gatherings to try and curb the spread of the virus."

1 Like Save    
Thank you for reporting this comment. Undo
vedabeeps

And we need cruise ships? If they can’t support themselves maybe they should be allowed to fail.

Save    
Thank you for reporting this comment. Undo
Kathy

Start with the airlines. Rather than using their profits from the past five years to pay off debts and save for a rainy day, the big four — American, United, Delta and Southwest — instead grew their combined liabilities to $166 billion, all while spending $39 billion on share repurchases. That number, which is only from the big four, is almost 80% of what they’re asking for now from U.S. taxpayers. Similarly, the three largest Cruise companies — Carnival, Norwegian, and Royal Caribbean — have liabilities of $47.5 billion and engaged in share repurchases of $8 billion.

Had these companies paid down liabilities instead of using stock repurchases to bid up their stock prices, they would have been far better prepared to weather this emergency. Of course, higher share prices made their stock options more valuable. This allowed top airlines executives to pay themselves $666 million in compensation over the five-year period. The top cruise executives managed to haul in $448 million. Now, taxpayers are unwillingly being called upon to bail out their profligate behavior.


snopes

Save    
Thank you for reporting this comment. Undo
Kathy

So much for buybacks. Although they can’t use this money for that the harm is already done.

Save    
Thank you for reporting this comment. Undo
Nana H

Maybe, just maybe everybody should suck it up and get this deal done...everybody.

Save    
Thank you for reporting this comment. Undo
Kathy

Unfortunately this is what happens when they have to pass emergency bills.

Save    
Thank you for reporting this comment. Undo
catspa_zone9sunset14

Should we now start acrimonious yowling about the four Republican senators who are now holding up passage of the bill and inviting economic collapse and endangering Americans' lives, as Democrats were accused of doing only a day or two ago? Just wondering. Putting "political games" above lives... tsk tsk source

1 Like Save    
Thank you for reporting this comment. Undo
maifleur03

One of the interesting things about this is calling it a stimulus rather than assistance or any other term. It does allow the money to go to those out of work who should have filed for unemployment. Gig workers could not but not certain on what basis they would receive it because many states have limits. So it would be in addition to that. Depending on the final bill and Treasury it may or may not provide the extra money when people can start leaving their homes.

Save    
Thank you for reporting this comment. Undo
ubro(2a)

Aren’t governmental support checks to businesses or individuals a thing that America is supposed to run from? Where are the smug Darwinian capitalists? Why aren’t they rigidly refusing to allow this to happen? Don’t they have any principles?


OMG my laugh for the day, soooo true, capitalists always hate socialism until they need a 'bail out'!

3 Likes Save    
Thank you for reporting this comment. Undo
Iris GW

paprikash, were you able to confirm what you thought you heard, btw?

paprikash

One news story I heard was that all employees working for any company where Trump or anyone in Congress has a stake would be treated differently from those employees not connected to our electeds. I’m off to google because I really heard this on TV when I was in another room of my mansion so I don’t know who said it.

Save    
Thank you for reporting this comment. Undo
Izzy Mn(4)

One provision that got left out is listing the companies that get money, from what this article says. Wouldn't transparency be better. The Democrats wanted that, thought that was the agreement, but it wasn't in the final draft.

https://www.politico.com/news/2020/03/26/democrats-delayed-stimulus-bill-ban-on-trump-family-profiting-150282

"The bill also was missing a second provision that Schumer and Sen. Elizabeth Warren (D-Mass.) had pushed, indicating that the Treasury Department had to publish the companies receiving the loans every seven days.

"Without this language, this information could have been kept secret from public," said a Democratic aide.

I'm having trouble trying to figure out if this is in the bill or not. Anyone know?

Save    
Thank you for reporting this comment. Undo
gsciencechick(8a NC/SC border)

Did you know the $500 billion can be leveraged up to 10 times?? So, this could end up costing us almost $5 trillion dollars. And you know they are willing to do it.

Stimulus details

Save    
Thank you for reporting this comment. Undo
maifleur03

A little clicker was on my mayor's fb page but this from an article concerning it. "Some of that money is supposed to bypass statehouses and go directly to local governments. Crucially, though, only cities and counties with more than 500,000 residents appear to qualify for direct aid." Kansas City is just short of that 500,000 mark.


Read more here: https://www.kansascity.com/opinion/editorials/article241573946.html?fbclid=IwAR2DuHjEQ_vFehkGA7f1ewqq-YGZgN9ajnuyEbWDHi59AlzfyWlItUzUA90#storylink=cpy

Save    
Browse Gardening and Landscaping Stories on Houzz See all Stories
Resilience How the Coronavirus Is Affecting Design and Remodeling Pros
Pros are seeing changes in their businesses as clients are affected by work and school closures
Full Story
Features Wild Birds Transform a Woman’s Garden and Life
How Sharon Sorenson created a wildlife haven and became the Bird Lady of Southern Indiana
Full Story
Pets Dealing With Pet Messes: An Animal Lover's Story
Cat and dog hair, tracked-in mud, scratched floors ... see how one pet guardian learned to cope and to focus on the love
Full Story