Bailout money bypasses hard-hit New York, California for North Dakota, Nebraska
S E E D E D C O N T E N T
From his office in Bismarck, North Dakota, Alan Haut started preparing for the coronavirus relief bill before it had even been passed by Congress.
North Dakota had experienced only a handful of deaths from the COVID-19 pandemic, and the state’s Republican governor, Doug Burgum, hadn’t issued a shelter-in-place order or required businesses to close. But as district director of the federal Small Business Administration office in Bismarck, Haut wanted to be ready. So he began convening community banks and entrepreneurs and sharing early drafts of applications to what would become the $349 billion Paycheck Protection Program, with an eye toward ensuring that prairie businesses would be able to get access to loans as soon as the application period opened.
On April 3, the morning applications opened, Jeff Zarling, founder of DAWA Solutions Group, a software company that also puts on an annual oil industry trade show, drove to First International Bank & Trust, whose branch in downtown Williston (population 14,716) was still open, and dropped off a flash drive with his complete application.
“My banker knows my situation, and we communicate through the year,” Zarling said. “So I simply had to run a few financial reports, which took less than an hour.”
It wasn’t long before Zarling learned he would get help. Although sponsorships for the October trade show have dried up as oil prices have crashed, Zarling said the federal bailout money has allowed him to avoid layoffs. That’s because the federal government is keeping his workers paid.
This was the purpose of the Paycheck Protection Program: to subsidize vulnerable small businesses and avoid massive layoffs. The loans will be forgiven entirely under certain conditions, including a requirement that a company keep all of its employees on the payroll for at least eight weeks. Within weeks, the Small Business Administration had exhausted the $349 billion appropriated by Congress, a pace that President Donald Trump has called “an incredible, incredible success.”
An analysis of 1.6 million Paycheck Protection Program loans by Reveal from The Center for Investigative Reporting found that 58% of North Dakota’s small businesses got loans through the program. A majority of small businesses in Nebraska and South Dakota, neither of which have shelter-in-place orders, also received help.
It was a different story, however, in states with high death tolls and some of the earliest stay-at-home orders prompted by COVID-19. In New York and New Jersey, where more than 350,000 are infected and more than 20,000 have died , just 18% of businesses got help, Reveal’s analysis found. In California, where more than 3 million workers have filed for unemployment after that state became the first to issue a stay-at-home order, that number was 15%. (Reveal is among the California businesses that received a loan under the program.)
The figures were so stark that they sparked concerns of political interference. Rep. Jackie Speier, a California Democrat who serves on the House Oversight and Reform Committee, said the data raise questions about whether stimulus dollars were deliberately funneled to states that voted for Trump and have Republican governors.
Speier told Reveal that she would be calling for an investigation by the Government Accountability Office, the investigative arm of Congress.
Tags
Who is online
452 visitors
Reveal’s analysis found that businesses in states that Trump won in 2016 received a far greater share of the small-business relief funds than those won by his Democratic rival, Hillary Clinton. Eight of the top 10 recipient states – ranked according to the proportion of each state’s businesses that received funding – went to Trump in 2016. Meanwhile, seven of the bottom 10 states, where the lowest proportion of businesses received funding, went to Clinton. Taken together, 32% of businesses in states that Trump won got Paycheck Protection Program dollars, we found, compared with 22% of businesses in states that went to Clinton.
“If it is as it appears, it is downright criminal. So there has to be an investigation,” Speier said, noting that the president has a record of using his office to benefit his family and supporters financially , while seeking to deny government support to those he sees as his political enemies.
“As far as the president of the United States is concerned, if he can stick it to California, he will,” she said.
Miryam Mora Barajas, a spokesperson for the Small Business Administration, brushed aside allegations of favoritism and said the agency is treating every business fairly. “The system was created on a first-come, first-served basis,” she said.
As to why less-populous Republican states without shelter-in-place orders were receiving loans at far greater rates than large Democratic ones hit hard by COVID-19, she said, “I’m a federal employee and don’t comment on politics.”
Why would anyone be surprised that the States most dependent on federal entitlements are also the first ones with their hands out in an emergency even if they're not the ones being most effected by the crisis. And why would anyone be surprised that this sycophantic administration whose sole objective is to lick dirty Donald and his bases balloon knots wouldn't be approving funds for all their friends and supporters while refusing to aid those they see as political enemies. Sadly, this is just par for the course for Trump and his cronies.
who here thought that any of that money would actually go to any of his perceived enemies, please raise your hand.
Well, in addition one must ask several questions to get to a point where this means anything:
Without getting this additional information, one cannot get an apples to apples comparison and the comparison of percentage of businesses that received the money is really meaningless.
Not sure what you are trying to 'assert' here, but to my dismay it appears that you are leaving out or dismissing the word UNITED in the name United States. Could you clarify?
I thought my assertion was clear: Need more information.
The mere relative percentages of business in each state is not enough information to base the claim of inequitable distribution of the funds set forth in the legislation. How many businesses are there in each state? How Many businesses applied in each state? What was the distribution amount to each state? Each business? Each worker?
Much more useful figures to look at would be the dollar amount per business that applied in each state and the per capita amount allocated.
As to the rest of your comment, are you trying to imply that I have given any reason whatsoever to think that any one state deserves special treatment?
Wow, this is disgusting. Does anyone know if there is going to be an investigation? Or is this more political payback, like the SALT exemption.
The federal government is not obligated to allow for any deduction at all for state and local taxes paid when figuring federal income taxes due. I think it’s fine that now the deduction is uniform nationwide no matter the tax rate paid or services received locally. The rich pay 95% of the increase tax liabilities that are a result of the nationwide cap across the country.
No investigation. This is Trumpism at its core. If Trump is re-elected the coup de grace will be fulfilled.
The entire Trump administration is corrupt.
Just who is surprised?
Who here on this site didn't see this coming......?
Actually me. I did believe it was going to go first come first served. Silly me.
The point was that it did go to first applied first served. The biggest banks slow walked their applications while small community banks and credit unions rushed theirs.
I asked a question on Face Book the other day that I think I will ask here:
Is it my imagination or is this administration more crooked than Nixon's?
As crooked as a dog's hind leg.
I think we should start the chant...Jared in jail....
Nixon looks like a cross between Mr. Rogers and Mother Theresa compared to Trump
The Scum of the Earth POS potUS
Sad thing is they learned from Nixon. Have non disclosure agreements signed, stop oversight and keep things off the record.
Looks like small blue states fared as well as small red states. And the larger red states fared as well as the larger blue states. Where's Texas on the list?
What the data actually shows is that smaller states are more dependent on small business. The more populous states obviously have a higher proportion of bigger businesses who aren't eligible for small business loans.
The data actually reveals that less populous, more rural states typically get the dirty end of the stick under normal conditions. And now the big city states are complaining because rural America isn't being left behind again.
This chart does not align with your analysis. It refers to the percentage of small businesses that got the loans, not the percentage of businesses in a state that are small.
See comment 1.3.
Like California and New York, right?
More small businesses in California or New York received rescue loans than did there are small businesses in North Dakota.
Small Businesses By State, 2016
According to 2016 data, California has 791,268 small businesses and New York has 479,785 small businesses. North Dakota has 20,984 small businesses. California has 38 times more small businesses than North Dakota. New York has 24 times more small businesses than North Dakota.
The big states are getting a bigger piece of the pie simply because they are bigger. And the big states have a larger proportion of workers employed by businesses who are not eligible for rescue loans.
Taking money away from North Dakota wouldn't budge the proportionate numbers for California and New York because North Dakota didn't get that much money. The gripe is just a gimmick to squeeze nickels out of turnips.
The seeded article is another twisted lie being spread by a biased press. The blue states are not being cheated or treated unfairly.
So well over 100,000 Ca small businesses got loans while 12,000 North Dakota businesses did. Liberals and TDS sufferers always have to have something to whine about.
California has over four million small businesses employing over seven million people. North Dakota has 73 thousand small businesses that employ 211,000 people.
Do the math.
You do it. I was going off of Nerms official data above and my numbers are correct.
[deleted]
That is a tool of the devil, for heretics.
The big states are getting a bigger piece of the pie simply because they are bigger.
CA is a big state but received the least.
Where did I say that only 100,000 applied? I didn't. Nor did I say how many were rejected. So actually your comment is BS.
FYI, you do not have to ''go'' to the bank it can be done online.
Your inability to understand what is written seems to be the problem.
'your math is bullshit'
i can relate, as i thought i had ADD,
but,
it doesn't add up
Try to follow along. According to the article North Dakota got 58% approval rate and Ca. 15%. You figure out what 58% of a bit over 20,000 and 15% of almost 800,000 is and get back to me.
Again reading comprehension is important. I did not mention the number of companies that applied for PPP nor did I mention how many were rejected. So the BS seems to be on you.
The 100,000 number is yours, not mine.
Have a great evening and go tilt at some other windmills.
100,000 is roughly 15% of California small businesses and 12,000 is roughly 58% of North Dakota small businesses. Eight times as many California small businesses got the loans compared to the number of small businesses in zNorth Dakota that did. The number of California small businesses that got loans is 5x the total number of small businesses in North Dakota.
It might have had the smallest % of loans approved but it also got more total $ than any other state. Though likely the bulk of what California got went to its small towns and farms, ranches, and businesses that support the inland economy as these places likely relied on smaller community banks and credit unions rather than the big 5 banks that slow walked applications. Trump has always been very supportive of agricultural and rural inland California.
I read an article, need to find it, that an oil company and donald supporter got some of the funds even though they didn't fit the criteria. They had over 800 employees when the cut off was supposed to be 500.
Blue states send much more money to the Federal Government than they receive back. Red States are exactly the opposite. So, in that sense one could truthfully state that Blue States carry the financial burden for Red States.
At least other states don’t have to subsidize rich people in California and the northeast USA states who were having their high state and local taxes paid in part by ordinary people in rural and low state and local tax states.
The issue is not state and local taxes. And 'poor states' do not and can not subsidize a state like California which in it's own right possesses and maintains the 6th largest economy in the World. Your understanding of this issue is either fraught with error or an affliction of being 'blinded by the right.'
Ask a New Yorker or urban Californian who earns $250,000 a year or more and owns a home with a property tax value of 1,500,000 and owes 1,000,000 on the mortgage how much they could deduct for that in 2018 and how much they could in 2019 for the same situation. The difference between what they had in 2018 and what they have now was being paid for by regular taxpayers everywhere else before. Now you don’t have us country hick rubes to subsidize the real costs of high state and local tax states.
Actually, you are wrong about that assertion. As a general rule of thumb, the more populous states send more money to the federal government than they receive and the less populous states receive more money than they send to D.C.
That’s a different issue.
Property taxes are not Federal. Besides, when the Reagan Administration did away with Revenue Sharing for the states, the states in turn had to raise revenue on their own, hence the absurd heavy burden on the state's citizens with property taxes, licensing fees and other taxes.
I think in states that had shelter in place orders the workers were laid off so the businesses weren't eligible for loan forgiveness so taking a loan meant just taking on debt and many may have just not wanted a loan. If you qualify for loan forgiveness then it's free money but if not it's just another payment you'll be making for years. Also if you checked you might find the states that shutdown and had huge layoffs will be benefiting most from the inflated unemployment benefits while others will get very little of that Bailout money.