The Paycheck Protection Program of the CARES Act is, along with other portions of the Act, a total sham. Once more Congress has made every effort to pull the wool over the eyes of the American people. Even the names they give to such efforts are meant to mislead. CARES Act (Coronavirus Aid, Relief, and Economic Security Act). Payroll Protection Program (PPP). They are intended to make us believe they are earnestly working on the behalf of the American people while all the time they are working to take away our hard-earned dollars and ensure we are ever more dependent on the government for subsistence.
The current crisis has given them the perfect opportunity to increase their daring efforts. With help from the media, they have created a state of fear and anxiety among the populous not seen since 9/11. This condition has allowed the politicians to exercise control over our lives and pass sweeping legislation that never would have been contemplated in other circumstances.
The government attempts to placate us by offering us money in the form of a $1200 stimulus check. The median rent across the US is $1197 for a 2 bedroom apartment and average utilities are $240. Add on to this a car payment, groceries, and other monthly expenses the typical family may have and the stimulus doesn't seem like a stimulus at all for those out of work.
Then the government offers to protect our incomes through the Paycheck Protection Program. A program so fraught with loopholes that every major franchise corporation in the country has been able to qualify. Corporations holding millions of dollars in assets and cash reserves have been able to obtain the greater portion of the money available. 45% of all the money went to loans greater than $1 million. While the small mom and pop business with fewer than 15 employees is left hanging out to dry.
Some simple math shows this to be the case. 45% of the funds went to those requesting $1 million or more. This is equivalent to a $100,000 payroll per week. In March of this year, the average wage per hour had reached $24. Employer federal taxes on this amount are 7.15%. This ignores unemployment taxes as they vary from state to state but are always higher for newly established businesses. This means the employer pays out $25.70 for every hour the employee works, excluding any overhead or benefit costs. $100,000 divided by 40 hours per week is $2,500 and this divided by $25.70 is the number of employees on the payroll or 97.28 employees. Does this really sound to you like a small business? Does the restaurant you used to go to before the crisis have 97 employees? Does your barber? Your hairdresser? Your pizza parlor? Your favorite hangout? Your favorite boutique?
The maximum an employer could request was $10 million. Using simple reasoning this employer would have to have been paying the same number of employees 10 times more in wages or $240 per hour or had 10 times as many employees 970 but the maximum number of employees was capped at 500 so those 500 employees would have to have been earning twice as much or $48 per hour. What mom and pop, corner business pays its employees $48 an hour or even $24? According to Social Security Administration data for 2018, 80% of American workers make less than $70,000 a year or $33.65 per hour. 50% of American workers make less than half this amount or $16.83 per hour. It is clear this money was never intended to get into the hands of small businesses.
When the government was caught in their blatant attempt to fool the American people they quickly came up with a plan to add additional funds to the program. This they say will not have the same issues as the previous distribution of funds. Yet the SBA and the same banks are in charge of the distribution. The same banks that have not been held accountable for the first round of distribution. Has anything really changed? Does anyone believe any of these programs were meant to help the average American worker?
