So many complaints here. Based on the comments I think there is some misunderstanding about the nuts and bolts of this program.
These are loans. They are two year low interest loans. They have to be paid back unless some or all is forgiven. Forgiveness requires documentation on employees retained, wage history, and is capped at $20k/employee maximum. And of course a piece of that comes back to the government in terms of payroll taxes. Just because a company took a 1M loan, doesn't mean it will be 100% forgiven.
For those complaining the companies don't "need" the money - I know many households who received $4k+ in stimulus checks that didn't need it. Should they not have taken it?
And anyways, the whole point of this program was to get money to businesses quickly. Means testing takes time. Sure there are going to be some questionable loans. Some fraud too. But overall our government has spent a lot more money and gotten worse returns than the PPP.
throwaway_USD 1372 days ago [-]
>These are loans. They are two year low interest loans. They have to be paid back unless some or all is forgiven.
This is a highly politicized way to frame PPP loans. Its more like: "These loans are forgiven, unless you scammed the government." These loans were specifically designed to be forgiven, a minimum of 75% of the loan was to be for payroll and if used for payroll (what it was supposed to be used for) that portion of the loan will be forgiven.
>Just because a company took a 1M loan, doesn't mean it will be 100% forgiven.
Again this is so carefully worded to send a false signal...true "it doesn't mean" it will be 100% forgiven. But again the goal is for at least 75% to be forgiven up to 100%. The idea is businesses were supposed to get a loan with 75% allocated to payroll expenses and the extra 25% to approved non-payroll expenses (example: rent) and the portion used for payroll should be 100% forgiven...which in many cases will be the full amount of the loan, because many businesses didn't add an extra 25% for non-payroll expenses and just took the forgivable payroll portion.
Basically the only reason/way these loans would be repaid is if business took out the loans and spent the money on non-payroll expenses...that should be fraud and result in jail not a nice cushy 1% interest rate for people committing fraud.
hn_throwaway_99 1372 days ago [-]
Totally agree, and I think this is important to emphasize. I was involved in researching the requirements for a PPP loan for a nonprofit. I can guarantee that the vast majority of businesses (like 95%+) took out these loans with the intention they would never be paid back. Indeed, that was a feature, not a bug, of the whole "loan" program. If you took out the loans to keep employees on staff (and did so), then you had to fuck up hard to not have the loans be forgiven.
So it kind of irks me to see some people frame this like a large percentage of these loans will be paid back. Not only is that not the case, it was never intended to be the case.
throwaway_USD 1372 days ago [-]
>So it kind of irks me to see some people frame this like a large percentage of these loans will be paid back.
I constantly see this..."its not free money, its a loan, and the money will be paid back with interest, just like in 2008."
No, its free money for businesses, many of which will fail and let their employees go anyway.
Then you hear people claim how somehow it was a victory to keep people off unemployment for 8 weeks, but not a single person can explain why that is such a benefit. Its sort of like saying hey when Corona virus began I stopped flights from Country X and saved 10's of thousands of lives...maybe deaths were delayed but there is no evidence they were prevented.
robhunter 1372 days ago [-]
I think it's helpful to follow the money.
If it goes to salaries, those salaries are taxed (both payroll taxes for the employer and income taxes for the employee).
Those salaries, for the most part, get spent - on things with sales tax, creating business profits that are taxed, and supporting the employment of employees' whose wages are also taxed.
The idea that it's one giant money suck for businesses with no immediate return to the economy is not really accurate - it's not a zero-sum game.
throwaway_USD 1372 days ago [-]
>The idea that it's one giant money suck for businesses with no immediate return to the economy is not really accurate - it's not a zero-sum game.
No one argues $600B wouldn't help the economy. Can you point to where I said PPP will not help the economy?
Most people are starting to understand the fraud involved with PPP and understanding those funds could have gone to individuals and the money would have found its way back into the economy just the same...only faster as its not distributed out over 8 weeks with 25% reserved for non-payroll business expenses.
Of course there are arguments for why the money should have gone to businesses as it did and not people...but you don't hear any lawmakers making those argument publicly and if you do its limited to "we are saving jobs." My argument, if you feel compelled to call it that, is that there is no proof these jobs have been saved unless delaying unemployment by 8 weeks is considered a job.
kryogen1c 1372 days ago [-]
> those funds could have gone to individuals and the money would have found its way back into the economy just the same...only faster
how could this possibly be true? the economy started tanking because people stopped going out and spending money. giving people money wouldnt fix this.
throwaway_USD 1372 days ago [-]
>the economy started tanking because people stopped going out and spending money.
People continued spending money...mortgage/rent; car loans/insurance; food; etc...
>giving people money wouldnt fix this.
PPP didn't fix it did it?
There is an eviction and foreclosure crisis looming...giving people money may have done a better job than PPP in avoiding this coming disaster.
kryogen1c 1372 days ago [-]
> People continued spending money
i must be misunderstanding. surely you're not claiming that ordering people to stay inside and restricting building capacities didn't severely lower business revenue, are you?
> PPP didn't fix it did it?
i dont know why you said this. the PPP almost certainly fixed the short term problems created by a national quarantine. we're not out of the woods yet, but what do you think happened to all the money? you think hundreds of thousands of small business owners simultaneously committed fraud and didnt use the PPP for payroll? the PPP gave people money for rent, how did it not?
azinman2 1372 days ago [-]
If you can help a business stay afloat, then people get to keep their jobs long term. Many businesses are on a threshold, especially a place like a restaurant. They might be still doing take out, people are still working, but business isn't as good as it was previously.
If you do nothing and let tons of businesses close, then there's a huge chunk of the machinery of the economy missing once you start loosening the health regulations.
1372 days ago [-]
eric_b 1372 days ago [-]
Politicized? Give it a rest.
Yes, if a company spent 60% (down from 75%) of their loan on payroll, and does not exceed the 20k cap per employee, and retained the same number of employees they had at the beginning of the covered period, and can document all this, and they followed the initial SBA guidance when deciding how big of a loan to apply for, then they will get most or all of the loan forgiven.
There are lots of comments here about "what about the nail salon who has 14 employees and took 5-10M?!?!". Well, assuming that isn't just a case of bad data, there is no reasonable expectation that the loan will be forgiven in it's entirety. The majority will need to be returned to the lender plus interest.
throwaway_USD 1372 days ago [-]
>"what about the nail salon who has 14 employees and took 5-10M?!?!".
If true that is an obvious case of fraud and you are making my point, the only time a loan will be repaid is if the money was spent on things other than payroll...which amounts to fraud.
Who cares if its a nail salon? Math is math, if you have 14 employees the maximum eligibility would be 8 weeks of payroll with a cap at $100k salary + up to an addition 25% for non-payroll expenses. $5-$10M for a business with 14 employees is fraud on its face.
eric_b 1372 days ago [-]
I know lots of folks who got PPP loans. I don't know anyone who's getting 100% of their loan forgiven. Mainly because they took 2.5x monthly payroll as a loan - but then did an 8 week covered period (2x monthly payroll). Most of them will owe ~20% of the loan back to their lender since they had minimal other expenses.
hn_throwaway_99 1372 days ago [-]
> I don't know anyone who's getting 100% of their loan forgiven.
I don't think you know that many people then. I don't know a ton, but everyone I know is expecting to get 100% of the loan forgiven. Main reason being you just need to show that money is spent on payroll, mortgage interest and utilities. For a lot of businesses it isn't that hard to shift accounts around to show those costs are higher than their PPP amounts.
throwaway_USD 1372 days ago [-]
>Most of them will owe ~20% of the loan back to their lender since they had minimal other expenses.
That was my entire point is that the loans were designed to forgive a minimum of 75% of the loan, but it is 100% forgiven if they limited their loan application to 8 weeks of payroll.
All the people you know took 20% more for salary than they were supposed to and they should pay it back. Even based on your personal experience you should know this isn't the way to describe the program:
>These are loans. They are two year low interest loans. They have to be paid back unless some or all is forgiven.
Rather in your personal experience most of the loans will be 80% forgiven.
apinstein 1372 days ago [-]
It is not true that entire loan is forgiven if the payroll percent is met. Only the actual money spent on forgivable expenses (payroll + rent + interest on some debt) is forgivable. If you read the forgiveness application this is clear.
Overall though I’d expect 75-95% of program funds to be forgiven as they have extended the time window from 8 to 24 weeks making it much easier to use all funds in a forgivable way.
throwaway_USD 1372 days ago [-]
>It is not true that entire loan is forgiven if the payroll percent is met.
Where did I say that?
dboreham 1372 days ago [-]
It says exactly what the parent said: loan funds must have been spent on legit essential expenses, 80% or more of which must be payroll.
dboreham 1372 days ago [-]
I think this is a misunderstanding of the intention. The 80% means "we want you to spend this money on employee payroll, not a new boat" and they expressed that wish by saying "it needs to all be spent on payroll" , modified with "well, at least 80% on payroll and the balance on other essential non jetski expenses". So if the business spent 100% on payroll expenses that's just fine. It's the 79% and less they're worried about.
eric_b 1372 days ago [-]
Eh, I think the way I described it was fine. These are loans. I don't know anyone who's had even a single dollar forgiven yet. As far as I know there has been no official "forgiveness".
What do you call a loan that you still owe? A loan. Once the forgiveness guidance is finalized and people are actually receiving it, then perhaps I will recharacterize my description.
kolbe 1372 days ago [-]
If I give you $80,000 and loan you $20,000, the semantically important part of my action is as a "gift", not a "loan". Why do you want us to ignore the $80,000 and only pay attention to the $20,000?
throwaway_USD 1372 days ago [-]
>I don't know anyone who's had even a single dollar forgiven yet.
This is what I meant by political couching: Do you know any one who has paid back a single dollar?
>These are loans.
Fine care to loan me $1M and I'll pay you back 20% with interest.
eric_b 1372 days ago [-]
Loans always have delayed payment terms, you're being willfully obtuse.
throwaway_USD 1372 days ago [-]
>Loans always have delayed payment terms, you're being willfully obtuse
And how often do they have forgiveness terms?
hn_throwaway_99 1372 days ago [-]
What are you talking about? Every loan I've ever taken out (car, mortgage), except for school, had a payment due the first month after I took out the loan.
acdanger 1372 days ago [-]
I believe that ~20% portion is forgivable as well so long as it was an approved expense and they the ~80% was put towards payroll.
SpelingBeeChamp 1372 days ago [-]
It's all forgivable. And the PPP Flexibility Act raised the cap on non-payroll spending from 25% to 40% of the amount of the loan.
SpelingBeeChamp 1372 days ago [-]
Why would they have be limited to an 8 week covered period? It is possible to elect that, but the PPP Flexibility Act extended the “covered period” with respect to loan forgiveness from the original '8 weeks after the loan is disbursed' to 'the earlier of 24 weeks after the loan is disbursed, or 12/31/20.'
icedchai 1372 days ago [-]
I thought the period got extended to 24 weeks?
katzgrau 1372 days ago [-]
Is there actually a nail salon that took 5-10MM with only 14 employees? The guidance, at least initially, was to apply for 2 months of gross income and see what you get. You also had to supply supporting documentation.
I'd be shocked if someone somehow got something that egregious through.
vsareto 1372 days ago [-]
>I know many households who received $4k+ in stimulus checks that didn't need it. Should they not have taken it?
I'd rather have some of the waste money going to families over businesses for once. Families have to worry about loss of income and loss of health during this. Businesses just have to worry about income. Families are more fragile and should be prioritized.
dfxm12 1372 days ago [-]
Yeah, I don't understand the obsession with means testing support through such a crisis. Forgetting the issues with means testing in general [0], in this specific case, you can genuinely go from not needing it to needing it pretty quickly.
I am not necessarily disagreeing with you but a lot of small businesses in the US survive on thin margins and the owners also don't make a lot of money necessarily. So it is not always the case that a company only has to worry about income. They have to worry about paying employees, ensuring they can meet payroll (which in turn helps families of those workers), keep liabilities in check and many other issues.
I am totally with you when it comes to companies with deep pockets but a lot of very small businesses are really just a group of individuals trying to survive together.
balls187 1372 days ago [-]
The outrage is that the money didn't go to small businesses, but rather large ones who had the means to cheat the system.
robhunter 1372 days ago [-]
Why would there be outrage? There is $130b+ in PPP remaining for small businesses and it's incredibly easy to apply now.
freehunter 1372 days ago [-]
Why would there be outrage at the government handing billions of taxpayer dollars to people who are already billionaires while only giving $1200 to everyone else? My guess is because the government is handing billions of dollars to people who are already billionaires while only giving $1200 to everyone else.
contravariant 1372 days ago [-]
While that could possibly be true, it's worth noting that the database this thread is about can't really help support that claim as it exclusively contains data for loans over $150k (which might still cover some smallish businesses, but definitely not the smallest).
balls187 1371 days ago [-]
True. My comment was based on prior reporting on PPP funding problems, not based on the recently released names.
saghm 1372 days ago [-]
I don't see how this is an argument against giving it directly to families/individuals rather than businesses. The reason the government has an interest in subsidizing payroll is to make sure the employees don't suffer due to not having income, so the question is why not just give 75% of the allocated directly to individuals anyways (since it's supposed to be used for payroll anyways), and then just have businesses apply for the non-payroll portion? If anything, that would be _better_ for small business owners; they'd get money as individuals from the 75% to keep rather than using for payroll, and then they would still get as much non-payroll money as they would before from the remaining 25%. The only other differences from what I can see are that giving it as payroll preserves existing salaries rather than distributing equally to all individuals (which could be a pro or a con depending on your views) and potentially enabling businesses to use the money for things that they're not supposed it, in which case it ends up being a loan that they have to pay back.
JPKab 1372 days ago [-]
There's a lot of weirdness lately about people expecting companies to not take the money.
The virus wasn't any company's fault. The choice to respond to the virus by shutting down the economy wasn't any company's fault.
Previous epidemics in human history have been dealt with by simply accepting a death rate that modern society, via government policy, has chosen to not accept. This was an unprecedented response that no business could have predicted.
Why do so many of us view businesses who pay employees as the enemy? Agreed 100% on the fact that many of us on this board got stimulus checks that were later spent on mountain bikes or other luxury items. Members of the privileged keyboard class didn't need them at all. People who work with their hands ought to be pretty pissed off they simply didn't get double what they got while we received nothing.
adrr 1372 days ago [-]
Not all businesses shutdown. The issue is that a bunch of businesses took the free money who didn’t need it. We made a choice not to take it because we are booming during crisis. The stimulus checks had criteria to receive them and most people who are doing very well did not get a stimulus check. PPP could easily had a requirement that it had to be paid back if sales/rev increased during 2020 tax year. Instead the more likely scenario is that businesses that were most affected by covid will have to pay back the loan because their revenue fell to 0 and they had to cut employees. This money isn’t free, it is added to our national debt.
ryanwaggoner 1372 days ago [-]
There's a strong case to be made that, given our position as the world's reserve currency (without any clear challenger) and our dirt-cheap borrowing costs, the national debt is pretty close to free money. It's not like we're ever going to roll up our sleeves and pay it off, or even down. We'll just inflate it away. I'm not arguing for unrestricted spending, but a couple trillion to avoid economic collapse, borrowed at effectively 0% interest, seems like a deal worth taking.
_curious_ 1372 days ago [-]
The issue with this line of thinking is that it doesn't end...until it does. Neither you nor I will likely be alive, but our children may very well be :/
ryanwaggoner 1372 days ago [-]
I'm not arguing for unrestricted spending, but a couple trillion to avoid economic collapse, borrowed at effectively 0% interest, seems like a deal worth taking.
Would it be better to let the city burn down today because we're worried about a water shortage in 100 years?
1372 days ago [-]
raviolo 1372 days ago [-]
Why do we pay taxes then if the government can just borrow that money?
freeone3000 1372 days ago [-]
Taxes are significantly lower than government spending and have been for decades. This is a good question.
katzgrau 1372 days ago [-]
> We made a choice not to take it because we are booming during crisis.
What's strange about that is that there were/are so many unknowns. Sure, you could be booming, but what if the unexpected strikes and you are suddenly not booming due to yet another unforeseeable event? The worst estimates were that millions would die and we'd be heading into an era that would eclipse the great depression.
As prepped as you were, and as well as you were doing — taking every opportunity to add layers of resilience would seem like the smart thing to do, especially when you've got employees with families, customers that depend on you, etc.
digitaltrees 1372 days ago [-]
I agree with this. Any argument about moral hazard is out the window. Any argument about this being like “too big to fail” is misapplied. Banks in 2008 created the crisis and their risky loan portfolios and balance sheets. No company created Covid or state shutdowns. Let’s come together with a spirit of generosity and cooperation. Not petulance and resentment.
freehunter 1372 days ago [-]
Those things didn't cause covid, but they did cause the companies to be unable to handle the crisis. The outrage is mostly centered around companies who are wildly profitable and/or spend tons of money on stock buybacks and dividends instead of planning for an inevitable disaster.
Look at this: in 2019 Delta Airlines spent around $2b buying their own stock [1]. They also spent $300m buying their own stock in March 2020. In April 2020 they received $5b in government assistance [2]. What if instead of spending billions of dollars to improve their stock price, they saved some of that money in case they ever had a crisis to deal with?
It's not like this is the first time the airlines have been bailed out before, either. 9/11 wasn't that long ago.
Valid points. My argument though is that focusing on these types of cases will result in preventing other, more deserving businesses from getting and using funds. When the SBA threatened criminal prosecution to stop companies that are public, highly profitable and well financed from using PPP the real effect was to scare EVERY business and loans stopped almost immediately. I know a few businesses that need funds that chose to go out of business because the owner “didn’t want to go to jail”.
The thing is, if we don’t want to help companies that conduct stock buy backs during times of plenty, then need help during times of famine, 1. The time of famine or pandemic is not the time to fight that battle. Let’s revise stock but back law later. 2. Honestly, no policy can be designed to handle a global pandemic. This is not a normal time. Let’s leave the blame and moralizing for a few years from now.
Stock buy backs used to be illegal. Maybe they should be again. Or maybe only after a company has passed a financial stress test.
The thing is, the more we design the system for these unexpected edge cases the more complicated it gets. Maybe it just be better to have something like FDIC insurance that all companies buy and kicks in automatically.
dboreham 1372 days ago [-]
All the talk about companies shouldn't take the money happened after the fact. At the time the program was publicized as "we're injecting cash, no questions asked, into all businesses". Basically just like the "checks mailed to everyone" done at the same time.
icedchai 1372 days ago [-]
These loans may as well be grants. Any company with even a half decent accountant will make sure that most of the loan amount is forgiven.
tinalumfoil 1372 days ago [-]
> Should they not have taken it?
I seriously considered not cashing my stimulus check until I talked to multiple well off people that cashed their dead relative's checks. There just isnt a cultural expectation in the US that you wouldn't take what you're given.
EDIT: Rethinking my comment I'm giving myself too much credit. Since I never got a physical check, I couldn't have "not cashed it" if I wanted to.
mc32 1372 days ago [-]
>’ cashed their dead relative's checks.’
Unless there is some weird allowance (widower/widow inheritance, etc.) wouldn’t this be straight fraud?
I know in some countries people don’t report their relatives’ deaths in order to keep receiving their benefits, but obviously that’s illegal too.
A4ET8a8uTh0 1372 days ago [-]
Short answer is likely yes. Long answer is that depending on individual bank policy regarding depositing 3rd party checks, relationship with tellers/branch manager/what have you, or whether person verifying exceptions for remote deposit is sleepy that day, it may very well end up being undetected. And thats checks. ACH is a whole different can of worms.
In a sense, I am glad it is getting some scrutiny as clearly people who did not need the money benefited ( likely at the expense of people who really needed it - the currently public fraud cases are pretty amazing already ), but I am worried that this kind of scrutiny will make people hesitant to apply in the future just to avoid the headache.
mc32 1372 days ago [-]
Doing some of that could get people into lots of trouble. Not sure if they could get them with wire fraud if it’s a physical check but at least financial fraud, impersonation, faking a signature, caching someone else’s check, etc...
junar 1372 days ago [-]
Yes, people should not be cashing checks for the deceased, but part of the issue was that the IRS was sending them out in the first place before deciding that they shouldn't have.
> Q13. Why did the IRS send Economic Impact Payments (EIPs) to deceased individuals? (added June 26, 2020)
> A13. Upon enactment of the CARES Act, the IRS worked with unprecedented speed to issue Economic Impact Payments to individuals. The IRS initially implemented the legislation consistent with processes and requirements used with the 2008 stimulus payments, which resulted in EIPs being issued to certain deceased individuals. After further review, it was determined that such persons are ineligible, and the IRS has taken action to prevent future payments to deceased individuals.
>Unless there is some weird allowance (widower/widow inheritance, etc.) wouldn’t this be straight fraud?
I'd think if the estate is still open, it'd get rolled into that as income legally.
mc32 1372 days ago [-]
Though that would be a rather small percentage of disbursements... but aside from those corner cases it would be financial fraud...
michaelmrose 1372 days ago [-]
It is straight fraud good for years in prison.
nkohari 1372 days ago [-]
Almost certainly, yes.
odonnellryan 1372 days ago [-]
You pay taxes. You should take what the government gives you in return. I suppose there are many opinions here, but I have plenty of friends who refuse to take unemployment insurance, when they've paid into it for years (sometimes decades).
_curious_ 1372 days ago [-]
Why do you think that is?
pbhjpbhj 1372 days ago [-]
I was in that situation last year (in UK). There was about 2 months we could have claimed for help as I was out of work. I had secured a job though, and we had some (small) savings, so it was going to be messy.
There's lots we could have spent the money on, but we didn't need it - we've had to go without meals before, this wasn't that.
I think one can easily justify taking the money when you don't need it. Possibly the most moral action would have been to take it and help people who couldn't get the help and really needed.
We've had no problem taking charity, still most of the kids clothes are hand-me-downs from other families; and I don't see income support as charity per se, and we take income support of other types not related to being jobless.
The "you've paid in" argument would probably not be on our side either.
Maybe that fleshes things out anecdotally.
jacobsenscott 1372 days ago [-]
Some people think it is charity (it isn't) and they are too proud to take charity. Some people fear they will be less employable if they do because it is a record of a gap in employment.
mushbino 1372 days ago [-]
To your point, I know a bunch of people who applied for the forgivable loans just to see if they could get it. I know a guy who owns over two hundred Domino's franchises and got a $6M forgivable loan and his business has been up 30% since covid started. He can't hire people fast enough.
Another friend was pissed that he wasn't approved for a loan too even though he has zero employees.
dboreham 1372 days ago [-]
He may not have known these facts at the time he applied for the loan. There was extreme urgency projected from the banks at that time (get your application in at 10pm on the Friday the program opened up to stand a chance of getting a loan). So business owners had to decide on that day if their business was going to turn down in the next few months. An essentially unknowable thing for many/most businesses.
evan_ 1372 days ago [-]
Taking on a lot of new employees and increasing production cost a lot of money up front that you won't recoup instantly, cashflow is a killer
matwood 1372 days ago [-]
> I talked to multiple well off people that cashed their dead relative's checks.
I wouldn't judge a program because of people committing outright fraud.
wavefunction 1372 days ago [-]
Those people broke the law though cashing checks made out to their dead relatives. I understand that's part of some Americans' expectations of the world as well though.
eanzenberg 1372 days ago [-]
And this, ladies and gentlemen, is why universal healthcare, free college, basic income, and general socialism won’t work in the American culture. It may work in other cultures like nordic countries where people usually don’t take what isn’t theirs.
Nelson69 1372 days ago [-]
I think this program is generally well intentioned. I directly know organizations that benefited from it and it absolutely helped cushion the blow of initial lock-down. I also think that any time the US federal government is offering out free or low cost money it is imperative that we look closely and carefully, especially when the program was thrown together in a week or two.
"Need" is probably not the way to look at this, anytime there is "free money" there will be incredibly wealthy businesses and organizations with "need." There is a school of thought that you should "always need" free money. I think that's just business. I think the actual distribution is where you look.
It would be completely foolish, ATMO, to believe that every organization, bank, and business were treated equally or fairly in this process. We already know that banks like Cross River handled what appears to be a disproportional amount of the approved "loans," presumably because they are a slick fintech business. When the dust fully settles, I would be shocked if the distribution of the funds or the forgiveness was in any way egalitarian, the country just isn't. I fully expect that it will be another mechanism in which certain classes benefit from the US system and others will have been overlooked. And maybe there will be another excuse, minority owned small businesses may not have been as "well banked" as others or something and your choice of bank will be another differentiator. I've heard a couple stories of orgs that didn't even get applications from their banks until the fund was depleted. There will be some great success stories too, I'll reiterate that I think the program is based in good intentions. I just can't see it being executed fairly though, not when they're actually debating on whether the Bubba Wallace noose was a "hoax" or not and the president chimes in...
technothrasher 1372 days ago [-]
> and is capped at $20k/employee maximum
Only owners are capped at $20K. Employees are capped at $46K over the 24 week period, which works out to be that any employee making $100K or less annually is full covered under forgiveness.
_fullpint 1372 days ago [-]
my original comment was misinformed
ryanwaggoner 1372 days ago [-]
Actually, the PPP was re-funded and was set to expire a week ago with $130 billion unused until they extended it until August.
digitaltrees 1372 days ago [-]
I’ve said this a few times above but I’ll say it here. The funds are unused because the SBA threatened to criminal prosecute borrowers for obtaining loans when “they had alternative capital”. Lots of businesses owners worried that if they had home equity or credit cards available that would be “alternative capital” and they would go to jail.
After the SBA guidance application volume dropped off a cliff so the SBA, backpedaling, issued new guidance that they wouldn’t audit loans under $2M, but by then no one wanted to take the risk.
1372 days ago [-]
latortuga 1372 days ago [-]
There's still PPP money left so I'm not sure what your point about the finite sum is.
digitaltrees 1372 days ago [-]
There is money left because people were scared shitless after the SBA threatened criminal prosecution for misleading certifications. The problem is that issued a statement redefined the certification after the fact and made it much more strict and than when they were initially released. All of the sudden a bunch of people thought accepting the PPP funds would land them in Jail. Go to the reddit PPP or small business threads and you’ll see tons of people returning funds and expressing fear.
It’s important to note that the SBA issued its announcement after the public outrage of large companies receiving PPP. They have since back tracked and issued a blanket protection from audit for loans under $2M but the damage was done and the $130B hasn’t been touched since.
vmception 1372 days ago [-]
> They have since back tracked and issued a blanket protection from audit for loans under $2M
To be fair, this is mostly conjecture on your part. Reddit threads aren't a good way to get a handle on what millions of businesses of all different sizes are doing or why.
freeone3000 1372 days ago [-]
It's a survey selected by an independent factor - it's like a twitter thread, or local cafe gossip. It's not gonna hold up to a strong scrutiny but it's a valuable place to start.
_fullpint 1372 days ago [-]
I stand corrected. Early reports were reporting that many were not able to obtain loans due to the fund being consumed. I’ll delete my comment.
digitaltrees 1372 days ago [-]
Your comment is not entirely wrong. The reality is the $130B is left because people were too scarred to touch it after the government threatened to criminally prosecute companies after public outrage of large public companies obtaining loans. The public outrage was driven, in part, by the fact that lots of small businesses didn’t get loans before funds ran out the first round. That’s not a sign that there were adequate funds.
There are estimates that we actually need a second PPP of the same size ($600B) because lock downs are going to start again.
disgruntledphd2 1372 days ago [-]
You're not actually wrong, to be fair.
They allocated 350bn, it all got spent.
Then they allocated more, and some of that second round of money is left.
> Forgiveness requires documentation on employees retained, wage history, and is capped at $20k/employee maximum. And of course a piece of that comes back to the government in terms of payroll taxes. Just because a company took a 1M loan, doesn't mean it will be 100% forgiven.
I think your misunderstanding is that the rules actually get followed. What happens when everyone in the scheme comes back and says "the economy is shit, we can't pay that regardless" or more optimistically businesses that have 100's of employees that simply plea with the government that they can't repay their loans, but should be given 100% forgiveness in the spirit of "keeping unemployment low". It's far too political to introduce/enforce anything that makes unemployment numbers worse. It's like a "too big to fail" on a much larger order of magnitude.
> the whole point of this program was to get money to businesses quickly. Means testing takes time. Sure there are going to be some questionable loans. Some fraud too. But overall our government has spent a lot more money and gotten worse returns than the PPP.
I consider rape less evil than murder so hey I guess I shouldn't be so critical of rapists! Look, I know those things aren't totally analogous, but the point is that it's OKAY to be critical of the government, especially when a government program benefits those who need it the least.
digitaltrees 1372 days ago [-]
Why would it be a problem to redesign a social policy in the social interest? So what if everyone one comes and says PPP needs to be amended to do better in service of the country. Isn’t that what we want. It’s a good thing that they increased the spending period from 8 weeks to 24. Most restaurants were closed by state orders and were faced with forcing employees to come off unemployment (and employees resisted because unemployment was way better for them as they got an extra $600 week on top of regular pay) only to then pay them to stay home. Instead, by extending the spending window we give restaurants a fighting chance to have money to start operations again when it’s safe.
Let’s tone down the rhetoric a bit, in no way are PPP loans close to rape or murder in magnitude of harm so it’s an inflammatory analogy with no purpose.
In terms of the actual problems with PPP and percent of bad loans. Think of the counter factual. Would you rather have 1% bad loans or a wave of bankruptcies and layoffs triggering a depression that last 10 years? What about 10% bad loans? 50%?
The PPP was well designed and administered under the circumstances. Let’s make improvements because we are not out of the woods yet. But let’s not scape goat or focus on the edge case problems and then destroy all of the benefits prevented harm.
mbesto 1372 days ago [-]
> Most restaurants were closed by state orders and were faced with forcing employees to come off unemployment
And yet those businesses either didn't get the loans or got a minuscule amount comparatively speaking (especially to those who knew how to game the system).
> in no way are PPP loans close to rape or murder in magnitude of harm so it’s an inflammatory analogy with no purpose
It was meant as a comparative analogy (murder to rape, as PPP to <whatever is worse>) not from (rape as to PPP, as murder is to <whatever is worse>). That was my purpose - two bad immediately recognizable crimes in society with one being considered worse.
> Would you rather have 1% bad loans or a wave of bankruptcies and layoffs triggering a depression that last 10 years? What about 10% bad loans? 50%?
I'd rather have a civil debate about whether that's effective (see Japan's lost decade for comparisons of why quantitative easing has even longer potentially more disastrous issues). You're kidding yourself if you unilaterally think that the PPP program is the only way to alleviate yourself from a "wave of bankruptcies and layoffs triggering a depression that last 10 years". Again, we're just kicking the can down the road, like we always do.
_curious_ 1372 days ago [-]
"It's far too political to introduce/enforce anything that makes unemployment numbers worse. It's like a "too big to fail" on a much larger order of magnitude."
Yes and ?
mbesto 1372 days ago [-]
It makes the overall premise of the rules moot. There are no incentives for any business NOT to take advantage; thus creates a zero sum game provided by tax payers that enhances the rich. In other words, it's just kicking the can down the road for the poor to pick up the pieces.
_curious_ 1372 days ago [-]
You're not wrong
aleksandrm 1372 days ago [-]
Care to elaborate how could a household receive 4k plus in stimulus? Was it 4 different people who had earned 99k or less in one household?
dragonwriter 1372 days ago [-]
> Care to elaborate how could a household receive 4k plus in stimulus?
Married couple with up to $150K AGI ($2,400) + 4 dependent children ($500 × 4) is $4,400.
1372 days ago [-]
cj 1372 days ago [-]
Edit: Removed my comment, the original comment was refuting the $20k cap, but I misinterpreted the parent's comment when first reading it. Sorry!
> if a 24-week Covered Period applies, does not exceed 2.5 months’ worth of 2019 compensation for any owneremployee or self-employed individual/general partner, capped at $20,833 per individual; and
> if the Borrower has elected an 8-week Covered Period, does not exceed 8 weeks’ worth of 2019 compensation for
any owner-employee or self-employed individual/general partner, capped at $15,385 per individual.
1372 days ago [-]
ta17711771 1372 days ago [-]
> unless some or all is forgiven.
RIPE for favoritism, aka, corruption.
eric_b 1372 days ago [-]
I don't think favoritism is a concern. The forgiveness guidance is not, to my knowledge, finalized. But what we've seen so far is pretty cut and dried. It's possible some people could convince their lender to forgive more than they should - but certainly those meeting the forgiveness criteria will get it.
Corruption and fraud are certainly possible - though the lenders got paid from the government just for originating the loans. That is, they already made their money. There's no extra money in them over-forgiving a loan.
IG_Semmelweiss 1372 days ago [-]
Favoritism on the part of banks was real.
Source - applicant for 4 separate, PPP loans that were eventually awarded.
Banks are not stupid. They awarded funds first to their clients that had outstanding loans with them. That meant the banks' own portfolio was not impaired, thanks to influx of PPP
marcinzm 1372 days ago [-]
Huh? There are rules that if followed allow for forgiveness. The rules will presumably be applied fairly and equally to everyone. That's about the exact opposite of favoritism.
_curious_ 1372 days ago [-]
I don't see why @IG_Semmelweiss comment here is dead, it's not wrong...banks were incentivized to provide capital to their highest debtors / longest clients who otherwise were at greater risk of default and loss to the bank shareholders. It's not complicated, they acted in their best interest because there was by design nothing stopping them.
resters 1372 days ago [-]
Fairly does not entail equally. Chances are there will be a political calculation done by whoever is in power at the time, and loans will be disproportionately forgiven in a way that offers the most political benefit. The approach taken will be touted as "fair" and the recipients "most deserving of forgiveness".
hprotagonist 1372 days ago [-]
Without this program, my employer would have had to either lay off a large group of employees or we would've gone under.
As it is, out of a group of about 50, we furloughed 8, who continued without pay, qualified for unemployment benefits, but retained 100% health coverage. Two have returned to work already and we anticipate being more or less normal again in time to meet the loan forgiveness criteria.
It's good to have the database open to see -- and, hey, to double-check that we actually got it.
_curious_ 1372 days ago [-]
So will your employer be paying the "loan" back?
hprotagonist 1372 days ago [-]
if we can avoid it, certainly not. It's very transparently only a loan if you fuck it up and can't bail yourself out in time. If you can get back on your feet, it's a relief program, so that's the strong incentive from our board to demonstrate, by way of restoring people to full pay and hours, that we have been sufficiently relieved.
dopamean 1372 days ago [-]
Most of the loan isn't designed to be paid back. So what are you getting at?
_curious_ 1372 days ago [-]
Some people - and the companies they operate - will, given the option, on principle, not take money which they have not earned.
In the event that they did/do accept said money they did not earn, and that money was applied effectively and literally saved their asses in an emergency that they were not properly prepared for - they would never forget it and do whatever it took to repay this money that saved their life because they are grateful.
These examples do exist, I know personally know of some and maybe you do too...or not? But that's what I am getting at: everyone has different morals and values. Further, it's helpful to know what those are (when manifested into the form of a corporation) because then we get to make informed choices about who want to work for and with based on value systems. We vote every day with our feet, our dollars, and our attention.
Would I rather work for an employer who did what it took to navigate the Covid shitstorm on their own dime or the one who needed a lifeline and didn't even have the decency to pay back what was never theirs to begin with? Obviously.
Why do you think people are so interested in this data set? Many are acting on this intel in more ways than you think!
hprotagonist 1372 days ago [-]
We're VC backed, dude, that "money we haven't earned" ship sailed a loooong time ago.
On the flip side, the way you "pay it back" to your Noble Investors is to keep the ship afloat and deliver a ROI with a healthy and competent team.
Increasing shareholder value and also doing the right thing and coming up with a way to give our furloughed teammates health benefits during a pandemic was, I suspect, an easy decision for senior staff to make. I'm a lowly scientist, I don't get to make those calls -- but you won't hear me complaining about this course we chose, either.
katzgrau 1372 days ago [-]
> Would I rather work for an employer who did what it took to navigate the Covid shitstorm on their own dime
I don't know about that. Every accountant I knew urged their clients to apply — primarily because there were so many unknowns — at the worst of it, it seemed like things had a sincere chance of degrading into a real doomsday scenario.
I would argue that it would be outright irresponsible for a company to forgo applying for PPP. I wouldn't want to work for an employer who would choose to go against the advice of their financial advisors because they wanted make a point.
luckylion 1372 days ago [-]
If it's not designed to be paid back, is it a loan?
noun: loan; plural noun: loans
a thing that is borrowed, especially a sum of money that is expected to be paid back with interest.
Is it just called a loan because that sounds better than just calling it a subsidy?
dopamean 1372 days ago [-]
So the issue is with what the government is calling it?
luckylion 1372 days ago [-]
I believe that's why the parent comment had used quotes. It's not a loan, it's a subsidy. Calling it a loan is misleading, because loans are meant to be paid back, and this isn't.
felipellrocha 1372 days ago [-]
I believe it's a loan that can be forgiven if you fit into certain criteria. So, it's still a loan. If you fuck it up you have to pay back
ric2b 1372 days ago [-]
It's a subsidy with a penalty for those that don't follow the rules of the subsidy.
It's a slow process (as I've been respectful of the rate-limit on the reverse geocoding API I'm using), but I finished mapping four states and hope to complete the other 46 by the end of this week.
How about adding something to the page itself about completion status?
I went and looked, before reading your second paragraph, and the clusters immediately jumped out, and it either seemed suspect or wrong. Then I had to come back here to see why it was wrong.
greatwave1 1372 days ago [-]
Good idea, just added!
1-6 1372 days ago [-]
Great, we can now walk around with pitchforks. I'm kidding These loans have benefited numerous small businesses but we can now keep an eye on those who did not really need it.
_curious_ 1372 days ago [-]
"but we can now keep an eye on those who did not really need it." Who's to say?
PascLeRasc 1372 days ago [-]
The invisible hand of the market. Of course the people of the "we can't improve anything" mindset don't need to participate.
_curious_ 1372 days ago [-]
How does the invisible hand of the market determine "those who did not really need it" ?
wavefunction 1372 days ago [-]
Are the locations in Canada the headquarters of a Canadian company? I've read about non-US companies receiving PPP money so I'm just curious about that.
greenshackle2 1372 days ago [-]
I checked a bunch and they were all geocoding fails. If you zoom out you can find examples in several countries.
Examples:
All the ones in Ontario, Canada, e.g. Fullmer Construction, are really in Ontario, California.
The Christian Valley School on Artesia boulevard in Alberta was picked up instead of the one in Artesia, CA.
Simpson Labs is geocoded to Valencia, Spain instead of Valencia, CA.
GW Lawrence on Wilson street in Cordoba, Argentina instead of Cordoba, AR.
greenshackle2 1372 days ago [-]
If your API allows it you might want to limit results to US, there's like a dozen that are miscoded to different countries.
One thing I noticed is that my local Domino's got $150-300k, but that it was behind a different LLC name.
Is it possible to add a ggogle maps business name listing based on address next to the reported company name?
three_seagrass 1372 days ago [-]
Yep, automotive car dealers in my area have different names on their LLC and the dealership. It's a tough one to crack but implementing google street view would solve 70% of the checks.
antisthenes 1372 days ago [-]
Wouldn't you just end up with a population density map?
Cool project though.
greatwave1 1372 days ago [-]
My goal for this map was a tool to search for PPP recipients within your own neighborhood.
You're right that it would be interesting to do analysis on population-adjusted loan amounts for different regions... maybe something like a loan $ per capita map?
mbesto 1372 days ago [-]
I was thinking the same thing about the author from above as well.
What I think would be much more interesting is to see what businesses have physical B&M locations. In other words, cross reference Yelp/Google Places with the legal entity's address. Or maybe cross referenced against unemployment numbers by state/city (if that data exists).
fullshark 1372 days ago [-]
Yeah i'd try to normalize somehow to get a sense if a geographic area over or underutilized the program compared to expectation.
H8crilA 1372 days ago [-]
> reverse geocoding
Nit: what you're doing is geocoding, not reverse geocoding. Geocoding is the process of turning strings into lats/longs. Reverse is the reverse of that, namely lats/longs into strings.
Data's all sorts of messed up in this. My friend's company is in this and 3 columns are flat out wrong and different from what he submitted. There's only 7 applicant submitted columns!
But remember where it came from: thousands of lenders hand keying this stuff in with minimal guidance.
dfxm12 1372 days ago [-]
I wonder if learning how to spell Philadelphia, Pennsylvania correctly at a young age must make one better at spelling than just having to to write something easier, like New York, New York.
Looks like YC Research is no longer affiliated with Y Combinator, and has been renamed to OpenResearch. I wouldn't be surprised if their legal entity name hasn't changed from the original.
I love that an official SBA/federal release can have a file titled: "PPP loan data key things to keep in mind FINAL- Sunday.pdf". Nothing says "over-it" like all caps "FINAL-Sunday".
Also, maybe even funnier, is that the "Ayn Rand Institute" applied for a loan... that's the best thing in the database I've found so far.
It doesn't say "over it." It means it's the final revision. This is very common terminology among people who prepare documents like journalists, editors, public relations, etc...
robbyt 1372 days ago [-]
Also, working on a government project on a Sunday is very common for people who probably do not like their job.
koolba 1372 days ago [-]
I find it funnier than whoever created the zip file also included all the OSX garbage metadata files in __MACOSX as well.
I really think we should not call these loans, as that obscures what they are. Like it or not, the vast majority of these will be forgiven. We could argue that it was a good use a stimulus funds, or a bad use, but it was basically fre money funneled through businesses in a fairly un-transparent way.
Of particular reference here - startups that laid off employees and /then/ applied for a PPP loan
It's really not stimulus either. It's more correctly characterized as relief.
marcinzm 1372 days ago [-]
>Of particular reference here - startups that laid off employees and /then/ applied for a PPP loan
Aren't these exactly the companies that SHOULD have received PPP? They were clearly struggling and without the money were reducing head count already.
jjeaff 1372 days ago [-]
Yes, it is exactly who it is for. The PPP has provisions to get it forgiven only if the companies hire back those layoffs. If you are out of money, you are simply out. It took some time for the PPP to go through if you were able to get it at all.
llamataboot 1372 days ago [-]
Yes, of course one can make that argument and say that it was meant to stave off further reductions. I don't even know if this was a particularly bad way to do things, can't make the perfect the enemy of the good here.
I do think that a bunch of this money ended up lining the coffers of businesses that had an "in" with a particular bank or a particularly tax person, just because that's the way these things end up working in practice.
I would have preferred a much more stream-lined European approach combined with much more direct cash to consumers than this roundabout way of doing it, but I don't think it was entirely ill-intentioned. But when you start taking into account executive pay, etc, some of it can start looking pretty shady.
IG_Semmelweiss 1372 days ago [-]
Two factors:
This was a very smart way to bail out banks indirectly
At least PPP did not protect execs, but given that rank and file was saved, the execs got the reprieve too
throwaway_kufu 1372 days ago [-]
Why should taxpayers have bailed out businesses that couldn’t keep employees on payroll though?
There is no end in sight to either corona virus or the economic downturn, so it’s just throwing 8 weeks worth of taxpayer money into bad investments. What’s going to happen within 8 weeks to ensure these employees won’t just be let go again?
revnode 1372 days ago [-]
> Why should taxpayers have bailed out businesses that couldn’t keep employees on payroll though?
Because those same taxpayers voted in a government that prohibited many of those businesses from operating.
> There is no end in sight to either corona virus or the economic downturn, so it’s just throwing 8 weeks worth of taxpayer money into bad investments. What’s going to happen within 8 weeks to ensure these employees won’t just be let go again?
The purpose of the funds isn't to prevent future unemployment. It's to funnel funds to individuals who would otherwise be unemployed. The funds can only be used for payroll to be forgiven. So this is an unemployment payout by other means, in addition to the federal unemployment benefits that were expanded.
throwaway_kufu 1372 days ago [-]
Taxpayers owe businesses nothing, if a business can’t survive 8 weeks without a taxpayer bailout then it’s a bad investment and at this scale it is a fundamental weakness of the entire economy that should be fixed not propped up with taxpayer money.
> The funds can only be used for payroll to be forgiven.
That an odd way to say up to 25% of the loan can be used for non-payroll expenses like business rent...why are businesses getting loans to pay rent if it’s about employees? Employees didn’t get money for rent.
If it was truly about “funneling funds to individuals” they could have just done that, not given it to businesses first with a 25% extra for non-payroll expenses.
digitaltrees 1372 days ago [-]
No business can survive under those conditions and that is not a valid critique of their viability under a range of ordinary conditions.
Tax payer do own businesses due process under law and a respect for private property rights. In America, the government can’t seize a business without compensation. Mandatory shut downs, in the absence of financial assistance, is arguably a “taking” under the constitution and a violation of basic inalienable rights we as citizens each have.
As far as 25% being spend on other things. It’s kind of pointless to pay employees but not pay rent, get evicted, and have no place for them to go...kind of defeats the point. A restaurant kind of needs its physical location to operate and offer people jobs.
This isn’t about “funneling funds to individuals” that’s what unemployment insurance and stimulus checks were for. This was also about saving businesses so we don’t enter a depression.
throwaway_kufu 1372 days ago [-]
> Mandatory shut downs, in the absence of financial assistance, is arguably a “taking” under the constitution
False, government does this to businesses all the time and compensation isn’t due. Take hurricanes in Florida and mandatory shutdown/evacuation orders, there is no promised compensation.
Besides under imminent domain cases, I’d like to see some case law to support taxpayers bailing out businesses.
digitaltrees 1372 days ago [-]
Actually there is promised compensation in hurricane emergencies in the form of SBA EIDL (economic injury disaster loans).
The existence of imminent domain proves my point, there are circumstances where tax payers owe An obligation to property owners and their actions are restricted by that obligation. Now we can argue about whether this specific act is a taking but I destroyed your blanket argument that tax payers don’t own business anything.
Own a business with a plot of land, tax payers want to expand a road and tear down your office and take the land? Can’t do it without paying.
throwaway_kufu 1372 days ago [-]
In imminent domain if your property is taken you receive compensation, here many businesses closed and didn’t get PPP money, the government picked winners and losers.
Again feel free to cite any law supporting your argument: 1) the shutdown orders were a government taking of private property; And 2.) compensation for a temporary taking.
You missed the entire point of hurricanes, before any damage occurs governments order shutdowns and evacuations, there is no taking and there is no compensation for those shutdown and evacuation orders.
vonmoltke 1372 days ago [-]
> You missed the entire point of hurricanes, before any damage occurs governments order shutdowns and evacuations, there is no taking and there is no compensation for those shutdown and evacuation orders.
The time between evacuation order and landfall is at most four days. The economic damage from that phase is minor.
There are businesses in some parts of the US that are in their fourth month of being forcibly closed. The situation is not in any way, shape, or form comparable to a hurricane evacuation.
digitaltrees 1372 days ago [-]
I wouldn't expect there to be law given that the government as never responded to a pandemic in the way that it has now. Your argument that it is temporary may be persuasive, but I wonder if that disappears if the shutdown order is long enough that it results in the business failing.
Your point of the hurricane is not persuasive, in that situation, the hurricane does the damage, the government order is ancillary. Here, the shut down order is more of a direct cause in the business harm.
marcinzm 1372 days ago [-]
>There is no end in sight to either corona virus or the economic downturn
Most states are re-opening, ill-advised or not, and businesses are being allowed to operate again.
throwaway_kufu 1372 days ago [-]
I didn’t say shutdown I said economic downturn. Whether the open or not has no bearing if they will remain in business.
marcinzm 1372 days ago [-]
>Whether the open or not has no bearing if they will remain in business.
It very much does. Amazing how much harder it's to stay in business when your revenue is 0.
digitaltrees 1372 days ago [-]
Because tax payers, through their elected representatives, implemented social policy shutting down economic activity. Businesses operate with a state issued license to operate. If the government seized that license it will be taking private property without compensation in violation of the constitution. So the tax payers can either pay to help companies survive or they can pay for seizures of private property.
Frame it in the alternative, why should businesses have their property seized by public health orders because the tax payers have decided that is the right social policy? Why should some individuals be deprived of liberty and property?
throwaway_kufu 1372 days ago [-]
By that measure tons of people had their private property taken...PPP just picked the winners of the taxpayer bailout.
And no, government ordered shutdowns are not taking of private property, it’s done all the time for Natural disasters And taxpayers don’t bail out the businesses. Not to mention business don’t have “licenses” from the state, they may be incorporated and organized, but that wasn’t a requirement of the PPP loans, independent contractors were eligible and didn’t need a separate business entity to qualify for PPP.
digitaltrees 1372 days ago [-]
The government didn’t pick winners and losers. They made industry wide assistance to all competitors.
ocdtrekkie 1372 days ago [-]
Arguably it's a pretty transparent way: We're looking at a database of companies that got them.
xenospn 1372 days ago [-]
After they already got them.
digitaltrees 1372 days ago [-]
We don’t know anything about their business. For all we know PPP prevented 100% layoffs and a company shutting down.
Recruiting and hiring is hard. No one wants to lay people off.
The rules of PPP also require maintaining the same number of full time employees in order to receive full forgiveness. Any company that received funds and then reduced staff will not have full amount forgivable.
otoburb 1372 days ago [-]
Better late than never? Some level of open retrospective analysis might allow for more carefully crafted policies in the future.
css 1372 days ago [-]
Kinda funny seeing how investment management firms [0] (mis)use this [1].
There are a remarkable number of sketchy blockchain companies in this list-- many for larger $5 to $10 million dollar ranges.
I wonder how many of them were sitting on millions or tens or even hundreds of millions of deceptively obtained ICO funds at the time they obtained these 'loans'.
E.g. I see at least one that raised over 100k BTC in ICO funding just couple years ago.
vmception 1372 days ago [-]
Although ICO purchasers like to imagine they have investments in "not-securities", proper accounting of token sales from the issuer is revenue, and payroll goes to employees.
So if they had that revenue and also paid payroll to employees in 2019, they would be eligible.
The 2018 ones were screwed though, too far back. They probably exhausted a lot of their runway on marketing and extortionate exchanges.
Blockchain community is unique in that they treat $5-10 million raises as "forever money" for an indefinite time period, when even Series A tech companies would not be expected to last more than 15-18 months.
So there are a lot of misalignments in that sector, which are poorly understood by both the people in the sector, as well as critics outside of the sector.
The issuers themselves often have good legal help and proper accounting, as it is a tricky regulatory environment to begin with, which exacerbates these misalignments with their purchasers and psychological investors.
nullc 1372 days ago [-]
> often have good legal help
That hasn't been my experience, instead my experience is that many of these companies went through large numbers of lawyers who told them what they wanted to do would be likely found to be illegal before finding some that would sign off on it.
> "forever money" for an indefinite time period
For the most part this is because they don't deliver anything useful, so they won't get any more (at least not until they spin up a new operation under another name).
Some of the companies I see in that database have principals who are on their third or more failed blockchain/ico and hey have become exceedingly efficient at it.
vmception 1372 days ago [-]
ICOs are very expensive and the exchanges extort via listing fees, requiring market makers that want the issuer to post liquidity in both their token and multiple negotiable assets, continually, and then the market makers passing commission costs from the exchanges onto the ICO team.
This is continued because nobody can talk about it as they will immediately get delisted, the community will point fingers at the project team, AND the regulators will view the issuer as promising liquidity which further moves their asset into unregistered securities land, opening them to sanctions for the sale and promotion.
Ultimately the token traders and critics have no clue what's going on and think the founders have to be married to a software project with a runway that lasts forever because software development shouldn't be that expensive.
Yes selling tokens is a viable revenue event, but not a recurring revenue event for that project. So launching new projects is the only way to do that, and prior experience is more important to the actual investors providing the bankroll who make a lot of money putting these together. Many people are buying them for the wrong reasons, and there totally could be a market of the same size of people buying them without an expectation of profit.
It is an entirely viable business to make a website with one button that says "purchase button tokens to vote on the CSS color of this button by staking!", which I think should be recognized.
Even the concept of "failed" is misaligned and more often related to exchange rates and volume of the token, more than whether the team did anything.
There is a whole other market of investors bankrolling the parent organizations that are churning out ICOs, because all they see are highly scalable revenues and a multiple of that.
The people buying them need to be more discerning if they want a different result. Token issuance is primarily a game of entertainment and placating a community, and it should be put in that category. Or the community should be an active participant in making the token more useful and valuable.
They certainly do have employees and would be eligible for PPP. If they lied and are in a game of chronic fraud, now featuring the US Treasury, that's pretty risky!
hardtke 1372 days ago [-]
My kids' private school recently sent out a $500 per student tuition credit (about $650K for the entire school). I see now that they got a multi million dollar PPP loan (which will be forgiven). Their revenues were unaffected by the epidemic (full enrollment for next year and no plans to rollback the tuition increase).
ryanwaggoner 1372 days ago [-]
My kid's private school also got a PPP loan, but I don't begrudge them that at all. They applied for the program according to the rules and they're using that money to pay for necessities. While our school also hasn't (yet) lost much in the way of enrollment, their finances are worse now:
- more costs for financial aid
- more costs for cleaning and retrofitting facilities
- more costs for experts on reopening safely
- more costs for online education programs (software, training, etc)
- refunds of after-school programs, field trips, etc.
- fewer donations from alumni
The only thing that's really improved is maybe utilities? They 100% would have laid off teachers if they didn't get the PPP. It's ludicrous that people are begrudging schools for using this program exactly as intended.
eric_b 1372 days ago [-]
Unless you can see their books you really have no idea how their revenues did. And you really have no idea what additional expenses they're incurring due to COVID mitigations.
tfandango 1372 days ago [-]
Just looking through my home town for businesses I know about... A fair number of them I know carried on with business as usual and had no financial problems (one I used to work for). Seems wrong when there are lots of people in the same town lining up outside the unemployment office every day...
lotsofpulp 1372 days ago [-]
Because the goal wasn’t to help the people most affected. It was to maintain the socioeconomic order so that people would be incentivized to continue doing menial work for low wages.
If you give people at the bottom a choice to not work, by giving them cash directly, then they would have better negotiating power versus employers.
The employers would then have to raise wages, and therefore prices. That means consumers who were proportionally consuming more than others have to consume less as more of the wealth goes towards paying higher wages. And we don’t want that as a society.
So we make the aid contingent upon an employer who might bless you with a furlough so you can collect the temporary generous unemployment, but also yank it away in case your menial work is necessary and they can go back to paying you near minimum living wages.
digitaltrees 1372 days ago [-]
I don’t think you can make this argument when at the same time the government was paying an extra $600 per week on top of regular pay for unemployment.
lotsofpulp 1372 days ago [-]
That’s only if your employer has laid you off. If they continued your employment or called you back to work for $12/hour, you aren’t eligible for unemployment anymore. And if you refuse to go back to work, then you are also not eligible for unemployment benefits.
digitaltrees 1372 days ago [-]
Many managers like their employees and don’t want to stiff them like that.
My point was the argument that the government design PPP as an effort to perpetuate an existing system that reduces employees bargaining power and prefers businesses can’t be supported when the government specifically strengthen employees bargaining power.
lotsofpulp 1372 days ago [-]
I contend it didn’t strengthen the employees’ bargaining power, for the reasons I stated above. Unconditional cash would have.
The powers that be know that loans obligations have been made that can only be satisfied if labor costs remain contained. Their primary objective is to make sure the mortgages keep getting paid, and paying employees double would endanger that.
An easy illustration is the fact that “essential” employees at much higher risk of getting the virus are getting paid with their old near minimum wage per hour jobs with signs that say “heroes work here”, and their management bosses are working safely at home with minimal risk of covid earning the same pay.
White collar employees continue to earn higher salaries from the safety of their home, and “hero” janitors and housekeepers are getting the same $10 to $15 they received as before, except they get to deal with higher chances of coronavirus.
digitaltrees 1372 days ago [-]
There are no “powers that be” if you don’t like the system then change it. Start a company, pay people higher wages, build a competitive advantage. Or run for office. If you think there is some coordinated effort to oppress then build a counter effort.
I suspect what you would find is not some grand conspiracy but emergent properties from competitive forces.
lotsofpulp 1372 days ago [-]
I know there isn’t a grand conspiracy. It’s just a consequence of capital owners also being the decision makers. Why would the capital owners make a decision to reduce their power?
And a lone businessman can’t just pay workers more and make the world right. If I decide to pay people more, and run the numbers and figure out I can afford to spend $5M on a piece of land to develop, and my competitor decides to project paying people much less, they can afford to spend $6M for the same piece of land. So guess which business ends up existing? The one that doesn’t pay higher wages. Same situation with people choosing to shop at stores that offer lower prices.
It would have to be a nationwide effort to transfer wealth, such as UBI or higher minimum wages. Otherwise we keep going as is with an ever widening wealth/income gap.
jacobsenscott 1372 days ago [-]
You wouldn't know if companies you don't work for are having financial problems. Most of the time you don't know even when working there until it all crashes down.
These loans don't cause unemployment. Those same people would be unemployed even if those same businesses didn't apply for the loan.
We are only a few months into a multi year pandemic, so even if a company isn't suffering yet, they most likely will be soon. Getting a loan while it is available to preserve jobs as long as possible as the pandemic gets worse sounds like a sensible and ethical thing to do.
tfandango 1372 days ago [-]
This is a good point I had not thought of, and I appreciate you saying it without any extra snark! The reason that company stood out was that I know half the people that work there and they have told me that things are going well (they are in the online learning business). But as you said perhaps they don't know, and even if not it would be wise to inoculate your company from unknown impacts later if you have the opportunity... thx.
vmception 1372 days ago [-]
What is that supposed to mean?
I would never announce a financial problem or ever publicly announce employees let go. It would harm my contracts with vendors.
havelhovel 1372 days ago [-]
Maybe the loans helped those businesses carry on despite drops in revenue, as intended. In that case, the unemployment line is shorter than it might have been. Neither of us know without seeing financials, but it’s important to acknowledge both possibilities.
cj 1372 days ago [-]
Not sure why this comment is being downvoted.
I just searched my local city and noticed that our (for profit) ambulance service received a loan:
> DIAZ MEMORIAL AMBULANCE SERVICE INC
I definitely don't think they saw the number of ambulance rides go down. And also don't think their profits suffered.
alasdair_ 1372 days ago [-]
>I definitely don't think they saw the number of ambulance rides go down.
I'm friends with an ER nurse and she was saying that the ER was almost completely empty during the first few weeks of COVID-19 because everyone was staying home out of fear.
reaperducer 1372 days ago [-]
Not sure why this comment is being downvoted
Probably because there's no way he could possibly know what "business as usual" was for any company where he wasn't employed. He has no idea what each company's financial situation is and is merely spouting cynicism.
I definitely don't think they saw the number of ambulance rides go down.
Is this something you monitor? Is there even a way to do that with a private ambulance company?
Considering the number of medical providers, doctors' offices, and hospitals that had business plummet to catastrophic levels, I think you're imagining things.
I work in healthcare, and just off the top of my head can think of several medical clinics and pharmacies that shut down because of pandemic-induced financial difficulties.
FireBeyond 1372 days ago [-]
You'd absolutely be wrong. Most ambulance services saw a massive downtick.
People who would otherwise have gone to the ER, even if not strictly necessary, were hesitating, "do I really need to go, perhaps not".
And then on the other side, you had people who really _should_ go not wanting to, due to fear.
Both ambulance services in my county were shutting down ambulances and furloughing employees heavily.
-- a paramedic
eli 1372 days ago [-]
With all elective surgeries cancelled? I dunno but I’d be careful making assumptions.
troebr 1372 days ago [-]
I agree with not making assumptions. However I don't think you'd take an ambulance for an elective surgery since it's not an emergency.
reaperducer 1372 days ago [-]
Ambulances aren't only used for emergencies. They're used to transport people who can't otherwise get around, or who need medical equipment with them, or who are recovering from surgery, or to move patients from hospital to hospital, and a hundred other uses.
I wouldn't be surprised to learn that emergencies are a small portion of what ambulances are used for, but I don't have access to that data.
digitaltrees 1372 days ago [-]
Actually they did go down. Lots of evidence that people were not going to the hospital out of fear of Covid exposure
But let’s assume your premise; it’s likely their costs went up dramatically between Personal protective equipment, hazard pay, quarantine procedures for exposed employees etc.
Ambulance services are capital intensive (ie large Debt payments) and low margin. A 20% drop in revenue would bankrupt the company.
derision 1372 days ago [-]
There's been a number of articles floating around about people avoiding hospitals / emergency rooms for non-COVID related reasons because of concerns about COVID, and that people were suffering (and sometimes dying) at home rather than going to the hospital like they normally would. I'm sure a good portion of those include times when an ambulance would have been called
marcinzm 1372 days ago [-]
>I definitely don't think they saw the number of ambulance rides go down.
Covid hasn't been prevalent enough to increase ER visits in most of the country (until now) and other people have been avoiding going to the ER unless on deaths door. Not to mention the lack of driving has probably plummeted car accident rates. I remember reading that organ donors are in short supply.
throwaway0xb 1372 days ago [-]
Visits (business) were down significantly for ERs. People just weren't coming in with the silly stuff they did pre-covid. Now you might say that's a good thing overall but that doesn't pay the bills...
icedchai 1372 days ago [-]
Business activity and profits don't matter here. You don't have to prove you actually need the money to receive a loan.
schoolornot 1372 days ago [-]
Of all types of institutions, why should we be giving the banks the right to decide which businesses should be recession proof or not?
Personal opinion but I would have required the applicants of these quasi-forgiveness loans to give up 35% of their businesses to the state/county/federal inclusive of all assets and investments non-dischargeable by bankruptcy.
We have 100,000 people dead in this country, million dollar hospital bills for those on vents, and yet the stream of cash continues to flow to those too stupid to save a few months of operating expenses/payroll. What a trash society the US has become.
mardifoufs 1372 days ago [-]
I don't think you realize just how perilous the economic situation was in mid-late march. Money had to reach Businesses very quickly, regardless if some of the money would end up wasted. Only banks have the manpower, infrastructure and knowledge already in place to reach even small businesses across the entire country. There was absolutely no way for any governmental agency to be able to manage such a huge program in such a small timeframe.
Again, I can't stress how important time was. I study and work in financial engineering, and from what I've seen and directly experienced in the depth of the crisis, we were days from total seizure in the financial system. The only part that was still doing ok was banking (due to what happened after 2008). Adding to that, since it's much harder to just give millions of dollars of loans to anyone who demands than it is to give 2000$ per person through the IRS, you had to have a system to vet, check and analyse claims. That's exactly what banks were able to do almost immediately with minimal adjustments.
I agree that it is far from ideal for the private sector to such a big influence on a public program. But perfect is the enemy of good, especially considering the incredible human misery that failing could've led to.
digitaltrees 1372 days ago [-]
Great response. I wish all of the people criticizing these efforts would actually try to design a better program. Even the thought exercise would show how difficult it would be. Easier to crap on the work of others than actually do it yourself.
I also wish they would think about the consequences of no action. They probably don’t realize that cascade bank failures and supply chain disruptions happen fast and become permanent. In March there was a realistic possibility of systematic seizure of finance and the supply chain grinding to a total halt due to lack of financing. How do you stock groceries when they can’t buy inventory?
schoolornot 1372 days ago [-]
I remain unconvinced that so many companies were on "thin ice" that a do nothing approach would have caused a collapse. Any evidence of this?
I would've been okay-ish with the arrangement if there was some narrow qualification criteria like being in the grocery business or medical supply chain, etc.
Fine dining restaurants: not essential
Summer camps: not essential
Non-profits: not essential
Law firms: not essential either!
And yet we paid them millions... _why?_
I picked a random company from the 150k list. A pizza place, around the corner. Been in business since 2007. They received $150,000-350,000. So a place deemed essential by the governor and that's permitted to operate curbside and takeout delivery after being open for 13 years is eligible for 150k? What kind of drugs are we on?
mardifoufs 1372 days ago [-]
Yes, but the vast majority of the money is going to salaries. I'd even argue that there is absolutely no problem in funding even most of the "non essential" businesses. And to say that businesses were on thin ice by april is an understatement by the way: revenue disappeared overnight, lending froze almost overnight, liquidity became almost impossible to access. Even by early april half small businesses could not afford to pay rent, much less salaries. The financial system has never seen anything like what happened to march, I can't stress enough that almost every single "pipe" that make up systems we all depend on was collapsing. Programs like these took aways tons of uncertainty and deep fears of a recovery that would take a very, very long time. Things got much better when government support boosted confidence and guaranteed that people will still have money to spend.
Now I've heard people argue that compensation for lost salaries should've been paid directly to the employees if they lost their jobs. But to put it mildly, recovery and return back to normal would have been extraordinarily harder if most of the non essential parts of the economy don't exist anymore.
The price of letting everything go bankrupt only to reopen from scratch later is enormous and would amount to incredible waste not only of money but also years of work. The 150k may have been way too much for a local pizzeria, but it's better to overshoot than to aim for much better money allocation and risk losing precious time. You have to keep in mind that not only do businesses have to pay back the loans (if the money didn't go to salaries) but also that we will have ample time to take a closer look at each individual claim and punish fraud retroactively. The process is already starting as we can see with the linked website.
At the end of the day, we just couldn't afford to have a better PPP program because no matter how much money we lose on fraud and waste, the alternative would have always been more expensive.
digitaltrees 1372 days ago [-]
Do you know any restaurant owners or managers? Ask them about the drop in revenue and how long it can be sustained. Ask them how many employees they had and how many they need for curbside take out. Ask if they would have fired people absent PPP. Ask if they kept people employed because of PPP.
Do you have a better suggestion? I doubt it. There are to many edge cases in business to create a program that will be perfect. So your alternative is to take the risk of mass bankruptcies. If PPP designers and law makers are wrong billions are wasted. If your approach tested and is wrong, the economy is wrecked. Decision is easy when framed that way.
digitaltrees 1372 days ago [-]
When unemployment shoots to 25% it’s a sign of a lot of sever stress for businesses. Left uncheck the drop in demand will create further contraction. What more evidence do you want that urgent action system wide is needed? By the time the bankruptcy filings start its too late.
mywittyname 1372 days ago [-]
>and yet the stream of cash continues to flow to those too stupid to save a few months of operating expenses/payroll.
That's a bit of a harsh take. Lots of businesses took out these loans preemptively because they knew the money would dry up soon. Both the company I work for and our family business had applications ready to go the minute they could be filed because it was clear that the application process was going to be a mess.
I agree with you that the forgiveness should be tied to an ownership stake in the business, and that dispersal of funds should have only happened with demonstrable need of funds. But the people involved knew this was going to be a handout and acted accordingly. Taking these funds is an indicator of good business sense, not poor.
digitaltrees 1372 days ago [-]
No business with a 5-10% net margin can save 2 months operating expenses just in the off chance that there is a black swan event because doing so would put them at a competitive disadvantage over competition that doesn’t save and instead uses the money to lower prices, pay higher wages or invest in new products.
Meanwhile the government can borrow money at almost negative rates, based on long term tax collections, and arbitrage short term financial harm and need against long term repayment. Seems like a rational thing to do.
wiremine 1372 days ago [-]
> Of all types of institutions, why should we be giving the banks the right to decide which businesses should be recession proof or not?
Your underlying point is well made, but it's important to understand the process: The banks issued the loans, but the federal Small Business Association reviewed and approved them.
> yet the stream of cash continues to flow to those too stupid to save a few months of operating expenses/payroll.
You can disagree with the program, but the comment is overly hash, IMHO. As a business owner, I see the program as a lifeline to handle cashflow issues and retain workers. I'm not sure that is a "trash society."
srj 1372 days ago [-]
I think an angle missed here is that the government is trying to fend off deflation through fiscal stimulus. Individuals and small businesses have a propensity to spend, which gives forward pressure to what was then a rapidly declining velocity of money. The Fed's ability to act unilaterally is more limited, being executed through bond buying programs.
This money needed to be added to the economy, and really still does. I think PPP was one such reasonable approach (though much more is needed to save small/medium businesses).
basch 1372 days ago [-]
I would guess the logic was somewhere around KYC. Businesses have relationships with their banks, and the easiest way to be guided through the process was going to your local rep. Banks would be much better at determining "do we already have an established business relationship with this legit business" vs the federal government trying to determine "which businesses are fake or frauds." It was a way to distribute the verification workload.
wavefunction 1372 days ago [-]
The worst part of the PPP is that the approval of the "loans" was not the responsibility of the banks involved, they just "assisted" the loan seekers with collating their documents and the banks still charged the same fees they would normally for full loan servicing. So the banks got paid billions for doing very little, just a nice haircut off the top.
twblalock 1372 days ago [-]
> yet the stream of cash continues to flow to those too stupid to save a few months of operating expenses/payroll
If I was running a business and the government told me it was illegal for me to make money for the forseeable future, I would damn well want them to compensate me for that.
ProAm 1372 days ago [-]
> why should we be giving the banks the right to decide which businesses should be recession proof or not?
Would you rather have our politicians deciding this?
svachalek 1372 days ago [-]
Hmm, right at the top, 4 loans to 4 different businesses through 3 different banks to a residential address, including "venture capital" and "investment empire".
Most of the rest here look pretty legit as far as I can tell. The carwash got 3 loans which seems a little fishy? but to be fair they are a very busy one with a lot of employees.
graton 1372 days ago [-]
I was surprised that O'Reilly had a loan for $5-$10 million.
They seem like a company where most people can work from home.
EDIT: I totally forgot about their conference business. That makes more sense.
Shank 1372 days ago [-]
> They seem like a company where most people can work from home.
That's probably true, but the PPP loan covers economic impacts as a result of COVID-19, which can be things like "nobody wants to buy our books that are primarily sold as training materials." 340 people might include sales or actual book production, but it's hard to say without more transparency what the money actually went to/for.
bjt 1372 days ago [-]
Their conferences business took a huge hit.
toby 1372 days ago [-]
Huge hit is a bit of an understatement... they've cancelled all future conferences, likely permanently
pgwhalen 1372 days ago [-]
Why permanently?
lmeyerov 1372 days ago [-]
The people who built it up are now gone
MattGaiser 1372 days ago [-]
I think they have live trainers and a fair bit of conference business as well.
bengotow 1372 days ago [-]
This is great! I wish it was searchable by bank though. I heard that a local bank was making some interesting choices about who they helped through the PPP program and I'd love to pull up all the results by Lender.
According to D&B they have 10 employees and an annual revenue of ~$183,858, although I do not know how accurate that is.
rco8786 1372 days ago [-]
Worth noting that they will owe this back unless they can show it was used for payroll purposes.
How they got that much money in the first place is a definite mystery though.
sriram_sun 1372 days ago [-]
What if they go bankrupt after generously paying employees?
kradroy 1372 days ago [-]
That would be considered "mala fides" and the court would likely hold the officers/directors liable for the loan amount. Also, prior to filing for bankruptcy any attorney worth his spit will advise his client to fully repay or continue paying obligations to the US government. US government-backed loans are very difficult to completely discharge in a bankruptcy.
tfandango 1372 days ago [-]
perhaps it encoded in the PPP law, but I wonder if this could be sidetracked by bookeeping, using PPP money to pay people, and investing that money you would have used toward R&D or something.
gowld 1372 days ago [-]
Of course. That's what the huge scandal is about. $Billions going to wealthy political insiders who don't need it to pay furloughed employees.
fullstop 1372 days ago [-]
How does this actually work? Is this effectively "Free Payroll" for a few months or is it more complicated than that?
llamataboot 1372 days ago [-]
It is, yes. If you keep the same headcount and use at least 60% of it for payroll (not exactly clear how you prove that since money is fungible), it is essentially a stimulus check
reaperducer 1372 days ago [-]
It shouldn't be too hard to prove. Every time a company writes a payroll check the government knows exactly how much it was for and who got it. Seems like simple math.
rco8786 1372 days ago [-]
Yes, but an entirely different branch of government is who knows about it. Don't overestimate the ability of two disparate departments of an extremely large organization to communicate with one another.
icedchai 1372 days ago [-]
Simple math, except it might take years for them to compute it... That's why you generally want to keep your tax records for at least 3 years.
1372 days ago [-]
Jommi 1372 days ago [-]
It depends on the salary levels from last year.
king_magic 1372 days ago [-]
So... last year's average salary was $357,142 per employee? :)
The purpose of the Paycheck Protection Program is to keep people off of unemployment. The type of company taking the loan really doesn’t matter. Revenues don’t matter. What matters is that they have the employees (salary) to justify the funds. Forgiveness will be granted when they demonstrate they’ve kept their staffing levels the same. The whole thing is designed to prevent even more job losses. That’s it.
I think PPP saved the economy. We can scapegoat and find problems. But don’t ignore what would have happened in its absence. Companies would reduce spending at the very least or go out of business at the worst. We would have entered a self reinforcing cycle of reduced spending and purchasing creating a depression.
ryanwaggoner 1372 days ago [-]
I agree. I'm horrified by the current administration and their handling of the health side of this pandemic, and I'm completely shocked at how well the Federal government and the Federal Reserve have managed the economic side. Between the stimulus checks, the PPP, and the trillions spent by the Federal Reserve to prop up various markets. Yes, many mistakes were made and we'll end up having spent hundreds of billions on fraud and waste, but I don't think people have an inkling of how bad things would have gotten otherwise. All I can say is that I'm glad most of the people commenting here aren't in charge or this country would have completely collapsed.
And it still could! I think things will get very dark very fast if Congress doesn't extend at least some of the $600 / week unemployment benefits.
femiagbabiaka 1372 days ago [-]
depends on your definition of "the economy" -- the average american and small businesses are suffering quite a bit, but the stock market is definitely doing well. it would be interesting to see how many jobs were saved by PPP.
uptown 1372 days ago [-]
"I think PPP saved the economy."
You ain't seen nothing yet.
digitaltrees 1372 days ago [-]
Only if people criticize these initial attempts and prevent more assistance. Yes. This is going to get worse, but government support could continue.
luckylion 1372 days ago [-]
That's pretty much what people describe when they say "privatize the profits, socialize the losses", isn't it?
And you're already preparing to shift the blame towards the people critical of that approach.
digitaltrees 1372 days ago [-]
Privatizing profit and socializing losses is better applied to more ordinary situations where ordinary business risk is shifted to the public. Here we are taking about the total possible social loss caused by a pandemic, not ordinary business risk. The point is that in society will be more harmed by inaction than supporting businesses.
How interesting it is...not even through the A's yet in my major city and I am seeing peer companies on here reporting more "jobs retained" than they even employ...if that doesn't indicate what a scam this whole thing is, what would it take to make that clear?
Edit to add: further down the list I am seeing tech co's that actually laid off large % of employees that received millions still.
They probably were not counting on this information becoming public (though it obviously is/should be by default)...any respect I may have had for them is no more. Disgusting behavior.
Warning - large file download (128mb) doesn't work well on mobile
lgats 1372 days ago [-]
For some more digging, here is a list of S.E.C. registered companies loosely matched to the dataset using the company name: https://pppreport.org/sec.php
-list contains any company with a ticker [current/previous OTC stock or other]
-likely to contain many false associations, but still full of surprises
$NTN, $6.3m Market Cap
$TRNF, $22m Market Cap
$FAT, $40m Market Cap
each received 1-2 million in PPP
dvaun 1372 days ago [-]
Where is this data sourced from?
Edit: I tried accessing some common endpoints like /about to see if there are any unlinked pages, but could not find any. Hence why I asked the question.
It appears the database may include applicants who submitted partial applications but may not have actually received funds. For example, Index Ventures is in the database but claims they didn't take any loans. From the cnbc article:
> The venture capital firms Index Ventures and Foundation Capital, along with the scooter company Bird, said that they did not apply for the Payroll Protection Program, despite being listed in the database as having been approved for millions of dollars of funds from banks under that federally run program.
downvoteme1 1371 days ago [-]
I have a question that somebody more knowledgeable can answer.
My company, a recruitment agency, took 2 to 5 million in these loans and kept me hired . But since my main client kept me hired , the recruitment agency kept paying me. So did this recruitment agency just make 2-5 million in free money - just by proving that they ran my payroll- which they did. because the client kept me hired anyway.
raviolo 1372 days ago [-]
So, what if a business was successful, not impacted by covid, and wasn’t planning to lay off any employees anyway? Say, technology consulting company with 100 employees. Took out a PPP “loan”, which will be promptly forgiven since they keep the staff, who gets to keep the money? Something tells me 100% goes to business owner and 0% to employees.
I think there are quite a few companies like this. Hence “money goes to those who least need it”.
zzleeper 1372 days ago [-]
You are exactly right. In fact, I know of a few businesses that actually had MORE business (wholesalers), and the CEO of one told my friend that he was just going to use the money to buy his wife a new Porsche. This is anecdotal for sure, but there is no reason why firms wouldn't rely on free money as long as they are amoral enough.
If I had implemented the plan, I would have just created a program where the program only covered a % of the wages (say 80% instead of 100%) and mostly only for people who were not able to work. Of course, that brings other problems, but there is a middle ground somewhere in there.
raviolo 1371 days ago [-]
And I know a business owner who is shopping for a new house after getting a PPP “loan”. Sure, PPP money is supposed to be used for payroll. No problem, one can indeed use PPP money for payroll 100%. But then use the business revenue, 90% of which would normally be used for payroll, to take out a nice bonus and buy a house.
aazaa 1372 days ago [-]
It's a little surprising how many are banks. A few random searches showed about 80% of the companies are banks.
On reflection, though, not so surprising.
HaloZero 1372 days ago [-]
Huh, I didn't really see that. I did some cursory searches and haven't found a lot of banks.
Maybe you're thinking the lender field is the category of the company?
unstatusthequo 1372 days ago [-]
This is great intel for those who will phish the recipients. There’s a point where transparency causes risk...
bl4ckneon 1372 days ago [-]
Something I find amusing is the amount of miss spellings for some bigger cities. San Francisco is spelled around 10 different ways. You think people would spell check the city they live in before asking for hundreds of thousands of dollars or more...
j-c-hewitt 1372 days ago [-]
Anyone who saw these offers and did not expect the strings attached in terms of government meddling and/or decentralized witch-hunting for taking the money offered was foolish. There ain't no such thing as a free lunch.
xrd 1372 days ago [-]
Does anyone know the requirements around getting these loans? For example, if employees were furloughed without pay (but kept healthcare) are they still within bounds of the loan if they indicate they retained the jobs listed?
ksdale 1372 days ago [-]
You don't get forgiveness for wages you don't pay.
xrd 1372 days ago [-]
What happens if that happens? What recourse, if any, does an employee have in that case? Is anyone looking out for those cases?
ksdale 1372 days ago [-]
I'm not sure what you mean about recourse. If the employee isn't paid, the employer has to pay the money back, they don't get to keep it.
xrd 1372 days ago [-]
Let's say the employee was furloughed. But, the company applied and got PPP funds by saying they wouldn't furlough anyone. The employee was told one thing, but the reality was another. This could be a fraudulent form of a bridge loan, right? Easier to get in a crisis, the banks will only figure it out later.
Financing for startups has probably totally dried up. I bet a lot of VCs said: "We don't have any more funding for you, but try this approach..." And, they recommended going after PPP and at the same time recommended firing people to slim down the salary burden, but only after the PPP loan was safely in place. That extra time could be a lifeline for a startup.
I think this is what happened to me.
fullstop 1372 days ago [-]
Is there any penalty for increasing wages after receiving the "loan" ?
digitaltrees 1372 days ago [-]
It was unclear originally but the SBA issued guidance that this was acceptable. Think about it, isn’t hazard pay for employees coming back to work at risk of Covid exposure ok? Shouldn’t we applaud companies willing to pass PPP to employees?
Let’s not be so quick to label everything fraud, or greed. Sure some people will misuse funds. But most wont. Most people are good.
ksdale 1372 days ago [-]
Increasing whose wages?
fullstop 1372 days ago [-]
Those who are having their Paycheck Protected.
unethical_ban 1372 days ago [-]
There are several scenarios that frustrate me.
Examples like law firms or physicians' offices. These are relatively small firms with very wealthy principals. They are asking for taxpayer money to maintain their wealthy lifestyles, so they don't have to sacrifice their Bentleys to pay staffers. Examples: Thomas J Henry in San Antonio.
LLCs and franchisees that probably have millions of dollars in holdings and cash, but act under the guise of "small business" because they operate fast food or something.
Religious organizations. It's one thing if something like a local YMCA gets funds, but a church outright getting funds without proving it is going to public services (why don't we just have better public services?) is not proper. Churches already don't pay taxes.
bdcravens 1372 days ago [-]
> Religious organizations. It's one thing if something like a local YMCA gets funds, but a church outright getting funds without proving it is going to public services (why don't we just have better public services?) is not proper. Churches already don't pay taxes.
They still have to pay their employees, which is the point of the PPP. Those employees are paid from the funds that come in via donations, which are likely down during the pandemic (especially when many couldn't hold services). Put more simply, their income is down the same way my employer's is, as a result of the pandemic.
> a church outright getting funds without proving it is going to public services
The requirements of the PPP require that at least 60% must go to salaries.
> Churches already don't pay taxes.
Their employees do.
WaxProlix 1372 days ago [-]
> The requirements of the PPP require that at least 60% must go to salaries.
My understanding was that 60% of what you don't have to pay back goes to salary. The money that went to salaries and an additional 67% you just keep. Is that right?
digitaltrees 1372 days ago [-]
No that’s not right. The company has to spend 60% on salary. Then there are a range of forgivable expenses which is a very narrow category. Any PPP funds spend on any thing else 1. Risk criminal charges of misuse of funds at the worst, or 2. Become a loan. And right now we don’t know which option, 1 or 2 the government will favor.
jm4 1372 days ago [-]
A lot of misinformed generalizations here.
I work for a firm where staff took 20% pay cuts, partners took much larger cuts and the principals likely will not be paid at all this year. I had to lay off a dozen people personally. Other firms took similar or more extreme measures. Law firms are getting hit fairly hard like a lot of other businesses. We didn't take PPP funds, but if we did and it saved some of the 70 of my coworkers who lost their job in the worst economy anyone alive today can remember, then I wouldn't feel the least bit guilty about it.
Nobody is buying used Bentley's so I don't know where you get the idea that someone can just liquidate one to pay employees. And why should someone have to liquidate personal possessions to pay someone else anyway?
What franchisee do you know who is sitting on millions in cash? It doesn't work that way. Someone who franchises a fast food place makes an enormous investment, takes a significant risk, works their ass off and then pays substantial fees to the company. These are generally small business owners.
jowiar 1372 days ago [-]
> why should someone have to liquidate personal possessions to pay someone else anyway
The issue is there's serious moral hazard where owners of a private business can, rather than maintaining a balance in the business, pay themselves the cash, then grovel to the public to bail them out. If you're socializing the risk, you shouldn't get to privatize the reward.
xemdetia 1372 days ago [-]
I think this feels like a misunderstanding of what the PPP loans were designed to do. They were an economic incentive to keep people on payroll instead of a mass layoff or long term furlough. The correct business decision if you are no longer allowed to operate a business or you are no longer bringing in revenue to support the business you currently have is to do layoffs. If you have anticipation that the revenues will return to normal you can try a furlough. There's no economic incentive to keep people employed if all expenses including payroll suddenly eclipse the revenues of a business, and there's no incentive for a business owner to put personal wealth into their business if it has a great chance of never recovering.
The fact that the fixed expenses during this pandemic did not stop for corporations made the expense of payroll which provided significantly reduced revenue stand out. Even law offices and physicians have very high recurring expenses like insurance that they just can't stop and start on a dime and stay in business. It made no sense to keep people on the books until PPP gave a compelling reason to do so. It isn't about 'keeping a wealthy lifestyle' as much as 'keeping a functioning business' a lawyer or physician with no practice is just as much a drag on the economy as anyone else.
cj 1372 days ago [-]
> They are asking for taxpayer money to maintain their wealthy lifestyles
The one comforting limitation was that payroll calculations were capped at $100k. So if you had 10 people with a $250k salary, the maximum loan amount is calculated based on having a salary of $100k.
Although you're allowed to add in the cost of healthcare and 401k contributions without limitation.
I think the $100k cap was quite generous and probably too high.
robhunter 1372 days ago [-]
There's a comparable program in Canada where the government covers up to $750/week in wages - essentially $40k/year - from March to August depending on your revenues. Feels a little better than the $100k cap (although probably a bit on the low side).
1372 days ago [-]
digitaltrees 1372 days ago [-]
First, you don’t know the nature of these businesses. Second, the PPP has a salary cap of 150k specifically to ensure that it doesn’t “support wealthy lifestyle”. Third, most companies, even law firms and physicians offices have a range of employees, most of which don’t generate any revenue. PPP covers their salary. Finally, do you want to let law firms and doctors go out of business? Are you ok with the economic impact of a wave of spending cuts and bankruptcies?
ciarannolan 1372 days ago [-]
It's the class of people telling others that they should have "saved for a rainy day" who are the first to stick their hand out and take free money.
MattGaiser 1372 days ago [-]
The law offices and fast food places would just lay people off anyway without this.
One way or another the government is going to pay to keep these people employed.
pkulak 1372 days ago [-]
Those things only frustrate me if they aren't loans, which they would be, right?
Frost1x 1372 days ago [-]
To add to what some others said, the interest rates are also at a massive 1%, assuming they for some reason do have to pay them back.
Seems like even if you didn't need a PPP loan for staff, there are opportunities to create a scenario where it appears justified you need to loan to cover employees salaries, then divert the previous capital for your labor to an opportunistic expansion while others are scraping by. You got a large loan, with low interest, during a time period many were struggling. Great way to accumulate wealth.
verall 1372 days ago [-]
But there's still not enough of those loans to go round, so it is still very meaningful who gets them.
pkulak 1372 days ago [-]
The second round still has funding available.
bananabreakfast 1372 days ago [-]
No, they're not really loans, they are basically free money.
They only have to be paid back if you end up firing the workers you were supposed to keep employed with the loan. If they stay employed then your "loan" is fully forgiven.
pkulak 1372 days ago [-]
That's what I mean. You have to explicitly use them for payroll within 2 months of acceptance, and retain 75% of your staff, and a lot of companies are not bothering with that and just taking the low-interest loan. A loan is still something, but it's not even in the same area code as a grant.
digitaltrees 1372 days ago [-]
That’s not really free money. It’s money earmarked for employees or to maintain some basic infrastructure so employees have a place to work.
dave5104 1372 days ago [-]
Kinda sorta loans. They're made to be forgiven if:
> The Paycheck Protection Program is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll. SBA will forgive loans if all employee retention criteria are met, and the funds are used for eligible expenses.
They are forgiven if you use them to fund payroll, rent, mortgage interest, or utilities.
baby 1372 days ago [-]
They're also forgiven if your company goes bankrupt IIUC.
JackFr 1372 days ago [-]
> so they don't have to sacrifice their Bentleys to pay staffers.
You get that they'll keep the Bentley's and they just won't pay staffers? This program was the easiest way to keep people getting paid.
> LLCs and franchisees that probably have millions of dollars in holdings and cash,
Your "probably" is doing a lot of work there. You don't really have any idea. But the issue is you wan't "wealthy" corporations to bear the brunt of the economic shutdown. But why single them out? The PPP is an imperfect and blunt way to socialize the costs of the shutdown.
benatkin 1372 days ago [-]
That breaks down pretty quickly, once you get past the idea that every single billionaire is a bad person. Becoming financially successful involves money-saving habits, and personally taking a hit goes against it. Many more are trying to elect a politician who would tax them more, than are trying to simulate the effect with their own money. Many donate to charities but it's something like health or the environment, not the financial stability of local middle-class people.
To see how deep money and time-saving habits run, watch this documentary about Warren Buffet, where he goes to McDonald's and gets a cheap meal. https://www.youtube.com/watch?v=PB5krSvFAPY (3 minutes in)
jeffbee 1372 days ago [-]
A significant fraction of billionaires "became financially successful" through nothing more than the deaths of their ancestors. The idea that a saving habit contributes to financial wealth, rather than is simply associated with it, has no basis in research.
I_am_tiberius 1372 days ago [-]
I'm wondering why Saas companies like "CODA PROJECT INC" are on that list. I would have assumed they are not effected by the corona crisis. I thought they would benefit from it.
albntomat0 1372 days ago [-]
If their customers have significantly reduced income due to the pandemic, SaaS companies will get hit as well, even if they work from home, and their immediate customers (other businesses) do so as well.
floatingatoll 1372 days ago [-]
OP, could you add to the About page the total amount of loans issued where the loan amount was $150k+? It would provide a lot of context for this data.
I hate billionaires not spending this pocket change but depending on government for such loans.
But to play devil's advocate, aren't these most/all companies set up as limited liability, and therefore these billionaire owners are absolved of any responsibility to take on such bailouts?
So is this moral problem or more a structural problem on how the enterprise is being set up?
ryanwaggoner 1372 days ago [-]
"Billionaires" (or the much, much more common millionaires and hundred-thousand-aires who own most companies) wouldn't "spend the pocket change", they'd just lay people off or furlough them. This program was designed to keep businesses afloat and to keep them from laying off employees. It's a nice idea to think that all these companies would just altruistically keep their employees around doing nothing while they're shut down, but that wouldn't happen.
gm 1372 days ago [-]
Just so you all know, Twitter's going crazy with the apparent rampant inaccuracy of the database.
WrongThinkerNo5 1372 days ago [-]
Is the complain about the DB of the website or the raw data is inaccurate?
The former I can shrug off as insignificant, the latter is mildly terrifying and makes you wonder how the hell we can trust anything the government does when they can't even take care of keeping track of triple billons of dollars of other people's ... namely, people who did not get any stimulus ... money.
But I guess the bureaucrats and kleptocratic government must have been ramping it up after the billions upon billions they "lost" in Iraq without a trace. This is probably going to turn into politicians and bureaucrats throwing up their hands when companies claim that the information is inaccurate and they owe nothing and the government cannot prove anything, a la, housing fraud.
heurist 1372 days ago [-]
Definitely missing some, one of my companies is not listed (sub-$100k loan).
mikemac 1372 days ago [-]
The Treasury only provided business name data over 150k.
https://pppreport.org/about.php
> Details for loans under $150,000 remain mostly private, though industry codes and issuing bank details are available.
They have had to completely shut down in many places. They are legal businesses like any other, so why shouldn't they get PPP funds like any other business?
These are loans. They are two year low interest loans. They have to be paid back unless some or all is forgiven. Forgiveness requires documentation on employees retained, wage history, and is capped at $20k/employee maximum. And of course a piece of that comes back to the government in terms of payroll taxes. Just because a company took a 1M loan, doesn't mean it will be 100% forgiven.
For those complaining the companies don't "need" the money - I know many households who received $4k+ in stimulus checks that didn't need it. Should they not have taken it?
And anyways, the whole point of this program was to get money to businesses quickly. Means testing takes time. Sure there are going to be some questionable loans. Some fraud too. But overall our government has spent a lot more money and gotten worse returns than the PPP.
This is a highly politicized way to frame PPP loans. Its more like: "These loans are forgiven, unless you scammed the government." These loans were specifically designed to be forgiven, a minimum of 75% of the loan was to be for payroll and if used for payroll (what it was supposed to be used for) that portion of the loan will be forgiven.
>Just because a company took a 1M loan, doesn't mean it will be 100% forgiven.
Again this is so carefully worded to send a false signal...true "it doesn't mean" it will be 100% forgiven. But again the goal is for at least 75% to be forgiven up to 100%. The idea is businesses were supposed to get a loan with 75% allocated to payroll expenses and the extra 25% to approved non-payroll expenses (example: rent) and the portion used for payroll should be 100% forgiven...which in many cases will be the full amount of the loan, because many businesses didn't add an extra 25% for non-payroll expenses and just took the forgivable payroll portion.
Basically the only reason/way these loans would be repaid is if business took out the loans and spent the money on non-payroll expenses...that should be fraud and result in jail not a nice cushy 1% interest rate for people committing fraud.
So it kind of irks me to see some people frame this like a large percentage of these loans will be paid back. Not only is that not the case, it was never intended to be the case.
I constantly see this..."its not free money, its a loan, and the money will be paid back with interest, just like in 2008."
No, its free money for businesses, many of which will fail and let their employees go anyway.
Then you hear people claim how somehow it was a victory to keep people off unemployment for 8 weeks, but not a single person can explain why that is such a benefit. Its sort of like saying hey when Corona virus began I stopped flights from Country X and saved 10's of thousands of lives...maybe deaths were delayed but there is no evidence they were prevented.
If it goes to salaries, those salaries are taxed (both payroll taxes for the employer and income taxes for the employee).
Those salaries, for the most part, get spent - on things with sales tax, creating business profits that are taxed, and supporting the employment of employees' whose wages are also taxed.
The idea that it's one giant money suck for businesses with no immediate return to the economy is not really accurate - it's not a zero-sum game.
No one argues $600B wouldn't help the economy. Can you point to where I said PPP will not help the economy?
Most people are starting to understand the fraud involved with PPP and understanding those funds could have gone to individuals and the money would have found its way back into the economy just the same...only faster as its not distributed out over 8 weeks with 25% reserved for non-payroll business expenses.
Of course there are arguments for why the money should have gone to businesses as it did and not people...but you don't hear any lawmakers making those argument publicly and if you do its limited to "we are saving jobs." My argument, if you feel compelled to call it that, is that there is no proof these jobs have been saved unless delaying unemployment by 8 weeks is considered a job.
how could this possibly be true? the economy started tanking because people stopped going out and spending money. giving people money wouldnt fix this.
People continued spending money...mortgage/rent; car loans/insurance; food; etc...
>giving people money wouldnt fix this.
PPP didn't fix it did it?
There is an eviction and foreclosure crisis looming...giving people money may have done a better job than PPP in avoiding this coming disaster.
i must be misunderstanding. surely you're not claiming that ordering people to stay inside and restricting building capacities didn't severely lower business revenue, are you?
> PPP didn't fix it did it?
i dont know why you said this. the PPP almost certainly fixed the short term problems created by a national quarantine. we're not out of the woods yet, but what do you think happened to all the money? you think hundreds of thousands of small business owners simultaneously committed fraud and didnt use the PPP for payroll? the PPP gave people money for rent, how did it not?
If you do nothing and let tons of businesses close, then there's a huge chunk of the machinery of the economy missing once you start loosening the health regulations.
Yes, if a company spent 60% (down from 75%) of their loan on payroll, and does not exceed the 20k cap per employee, and retained the same number of employees they had at the beginning of the covered period, and can document all this, and they followed the initial SBA guidance when deciding how big of a loan to apply for, then they will get most or all of the loan forgiven.
There are lots of comments here about "what about the nail salon who has 14 employees and took 5-10M?!?!". Well, assuming that isn't just a case of bad data, there is no reasonable expectation that the loan will be forgiven in it's entirety. The majority will need to be returned to the lender plus interest.
If true that is an obvious case of fraud and you are making my point, the only time a loan will be repaid is if the money was spent on things other than payroll...which amounts to fraud.
Who cares if its a nail salon? Math is math, if you have 14 employees the maximum eligibility would be 8 weeks of payroll with a cap at $100k salary + up to an addition 25% for non-payroll expenses. $5-$10M for a business with 14 employees is fraud on its face.
I don't think you know that many people then. I don't know a ton, but everyone I know is expecting to get 100% of the loan forgiven. Main reason being you just need to show that money is spent on payroll, mortgage interest and utilities. For a lot of businesses it isn't that hard to shift accounts around to show those costs are higher than their PPP amounts.
That was my entire point is that the loans were designed to forgive a minimum of 75% of the loan, but it is 100% forgiven if they limited their loan application to 8 weeks of payroll.
All the people you know took 20% more for salary than they were supposed to and they should pay it back. Even based on your personal experience you should know this isn't the way to describe the program:
>These are loans. They are two year low interest loans. They have to be paid back unless some or all is forgiven.
Rather in your personal experience most of the loans will be 80% forgiven.
Overall though I’d expect 75-95% of program funds to be forgiven as they have extended the time window from 8 to 24 weeks making it much easier to use all funds in a forgivable way.
Where did I say that?
What do you call a loan that you still owe? A loan. Once the forgiveness guidance is finalized and people are actually receiving it, then perhaps I will recharacterize my description.
This is what I meant by political couching: Do you know any one who has paid back a single dollar?
>These are loans.
Fine care to loan me $1M and I'll pay you back 20% with interest.
And how often do they have forgiveness terms?
I'd be shocked if someone somehow got something that egregious through.
I'd rather have some of the waste money going to families over businesses for once. Families have to worry about loss of income and loss of health during this. Businesses just have to worry about income. Families are more fragile and should be prioritized.
0 - https://en.wikipedia.org/wiki/Means_test#Criticism
I am totally with you when it comes to companies with deep pockets but a lot of very small businesses are really just a group of individuals trying to survive together.
The virus wasn't any company's fault. The choice to respond to the virus by shutting down the economy wasn't any company's fault.
Previous epidemics in human history have been dealt with by simply accepting a death rate that modern society, via government policy, has chosen to not accept. This was an unprecedented response that no business could have predicted.
Why do so many of us view businesses who pay employees as the enemy? Agreed 100% on the fact that many of us on this board got stimulus checks that were later spent on mountain bikes or other luxury items. Members of the privileged keyboard class didn't need them at all. People who work with their hands ought to be pretty pissed off they simply didn't get double what they got while we received nothing.
Would it be better to let the city burn down today because we're worried about a water shortage in 100 years?
What's strange about that is that there were/are so many unknowns. Sure, you could be booming, but what if the unexpected strikes and you are suddenly not booming due to yet another unforeseeable event? The worst estimates were that millions would die and we'd be heading into an era that would eclipse the great depression.
As prepped as you were, and as well as you were doing — taking every opportunity to add layers of resilience would seem like the smart thing to do, especially when you've got employees with families, customers that depend on you, etc.
Look at this: in 2019 Delta Airlines spent around $2b buying their own stock [1]. They also spent $300m buying their own stock in March 2020. In April 2020 they received $5b in government assistance [2]. What if instead of spending billions of dollars to improve their stock price, they saved some of that money in case they ever had a crisis to deal with?
It's not like this is the first time the airlines have been bailed out before, either. 9/11 wasn't that long ago.
[1] https://ycharts.com/companies/DAL/stock_buyback
[2] https://finance.yahoo.com/news/major-u-airlines-accept-gover...
The thing is, if we don’t want to help companies that conduct stock buy backs during times of plenty, then need help during times of famine, 1. The time of famine or pandemic is not the time to fight that battle. Let’s revise stock but back law later. 2. Honestly, no policy can be designed to handle a global pandemic. This is not a normal time. Let’s leave the blame and moralizing for a few years from now.
Stock buy backs used to be illegal. Maybe they should be again. Or maybe only after a company has passed a financial stress test.
The thing is, the more we design the system for these unexpected edge cases the more complicated it gets. Maybe it just be better to have something like FDIC insurance that all companies buy and kicks in automatically.
I seriously considered not cashing my stimulus check until I talked to multiple well off people that cashed their dead relative's checks. There just isnt a cultural expectation in the US that you wouldn't take what you're given.
EDIT: Rethinking my comment I'm giving myself too much credit. Since I never got a physical check, I couldn't have "not cashed it" if I wanted to.
Unless there is some weird allowance (widower/widow inheritance, etc.) wouldn’t this be straight fraud?
I know in some countries people don’t report their relatives’ deaths in order to keep receiving their benefits, but obviously that’s illegal too.
In a sense, I am glad it is getting some scrutiny as clearly people who did not need the money benefited ( likely at the expense of people who really needed it - the currently public fraud cases are pretty amazing already ), but I am worried that this kind of scrutiny will make people hesitant to apply in the future just to avoid the headache.
> Q13. Why did the IRS send Economic Impact Payments (EIPs) to deceased individuals? (added June 26, 2020)
> A13. Upon enactment of the CARES Act, the IRS worked with unprecedented speed to issue Economic Impact Payments to individuals. The IRS initially implemented the legislation consistent with processes and requirements used with the 2008 stimulus payments, which resulted in EIPs being issued to certain deceased individuals. After further review, it was determined that such persons are ineligible, and the IRS has taken action to prevent future payments to deceased individuals.
https://www.irs.gov/coronavirus/economic-impact-payment-info...
I'd think if the estate is still open, it'd get rolled into that as income legally.
There's lots we could have spent the money on, but we didn't need it - we've had to go without meals before, this wasn't that.
I think one can easily justify taking the money when you don't need it. Possibly the most moral action would have been to take it and help people who couldn't get the help and really needed.
We've had no problem taking charity, still most of the kids clothes are hand-me-downs from other families; and I don't see income support as charity per se, and we take income support of other types not related to being jobless.
The "you've paid in" argument would probably not be on our side either.
Maybe that fleshes things out anecdotally.
I wouldn't judge a program because of people committing outright fraud.
"Need" is probably not the way to look at this, anytime there is "free money" there will be incredibly wealthy businesses and organizations with "need." There is a school of thought that you should "always need" free money. I think that's just business. I think the actual distribution is where you look.
It would be completely foolish, ATMO, to believe that every organization, bank, and business were treated equally or fairly in this process. We already know that banks like Cross River handled what appears to be a disproportional amount of the approved "loans," presumably because they are a slick fintech business. When the dust fully settles, I would be shocked if the distribution of the funds or the forgiveness was in any way egalitarian, the country just isn't. I fully expect that it will be another mechanism in which certain classes benefit from the US system and others will have been overlooked. And maybe there will be another excuse, minority owned small businesses may not have been as "well banked" as others or something and your choice of bank will be another differentiator. I've heard a couple stories of orgs that didn't even get applications from their banks until the fund was depleted. There will be some great success stories too, I'll reiterate that I think the program is based in good intentions. I just can't see it being executed fairly though, not when they're actually debating on whether the Bubba Wallace noose was a "hoax" or not and the president chimes in...
Only owners are capped at $20K. Employees are capped at $46K over the 24 week period, which works out to be that any employee making $100K or less annually is full covered under forgiveness.
After the SBA guidance application volume dropped off a cliff so the SBA, backpedaling, issued new guidance that they wouldn’t audit loans under $2M, but by then no one wanted to take the risk.
It’s important to note that the SBA issued its announcement after the public outrage of large companies receiving PPP. They have since back tracked and issued a blanket protection from audit for loans under $2M but the damage was done and the $130B hasn’t been touched since.
anything I can read about that?
There are estimates that we actually need a second PPP of the same size ($600B) because lock downs are going to start again.
They allocated 350bn, it all got spent.
Then they allocated more, and some of that second round of money is left.
I think your misunderstanding is that the rules actually get followed. What happens when everyone in the scheme comes back and says "the economy is shit, we can't pay that regardless" or more optimistically businesses that have 100's of employees that simply plea with the government that they can't repay their loans, but should be given 100% forgiveness in the spirit of "keeping unemployment low". It's far too political to introduce/enforce anything that makes unemployment numbers worse. It's like a "too big to fail" on a much larger order of magnitude.
> the whole point of this program was to get money to businesses quickly. Means testing takes time. Sure there are going to be some questionable loans. Some fraud too. But overall our government has spent a lot more money and gotten worse returns than the PPP.
I consider rape less evil than murder so hey I guess I shouldn't be so critical of rapists! Look, I know those things aren't totally analogous, but the point is that it's OKAY to be critical of the government, especially when a government program benefits those who need it the least.
Let’s tone down the rhetoric a bit, in no way are PPP loans close to rape or murder in magnitude of harm so it’s an inflammatory analogy with no purpose.
In terms of the actual problems with PPP and percent of bad loans. Think of the counter factual. Would you rather have 1% bad loans or a wave of bankruptcies and layoffs triggering a depression that last 10 years? What about 10% bad loans? 50%?
The PPP was well designed and administered under the circumstances. Let’s make improvements because we are not out of the woods yet. But let’s not scape goat or focus on the edge case problems and then destroy all of the benefits prevented harm.
And yet those businesses either didn't get the loans or got a minuscule amount comparatively speaking (especially to those who knew how to game the system).
> in no way are PPP loans close to rape or murder in magnitude of harm so it’s an inflammatory analogy with no purpose
It was meant as a comparative analogy (murder to rape, as PPP to <whatever is worse>) not from (rape as to PPP, as murder is to <whatever is worse>). That was my purpose - two bad immediately recognizable crimes in society with one being considered worse.
> Would you rather have 1% bad loans or a wave of bankruptcies and layoffs triggering a depression that last 10 years? What about 10% bad loans? 50%?
I'd rather have a civil debate about whether that's effective (see Japan's lost decade for comparisons of why quantitative easing has even longer potentially more disastrous issues). You're kidding yourself if you unilaterally think that the PPP program is the only way to alleviate yourself from a "wave of bankruptcies and layoffs triggering a depression that last 10 years". Again, we're just kicking the can down the road, like we always do.
Yes and ?
Married couple with up to $150K AGI ($2,400) + 4 dependent children ($500 × 4) is $4,400.
> if a 24-week Covered Period applies, does not exceed 2.5 months’ worth of 2019 compensation for any owneremployee or self-employed individual/general partner, capped at $20,833 per individual; and
> if the Borrower has elected an 8-week Covered Period, does not exceed 8 weeks’ worth of 2019 compensation for any owner-employee or self-employed individual/general partner, capped at $15,385 per individual.
RIPE for favoritism, aka, corruption.
Corruption and fraud are certainly possible - though the lenders got paid from the government just for originating the loans. That is, they already made their money. There's no extra money in them over-forgiving a loan.
Source - applicant for 4 separate, PPP loans that were eventually awarded.
Banks are not stupid. They awarded funds first to their clients that had outstanding loans with them. That meant the banks' own portfolio was not impaired, thanks to influx of PPP
As it is, out of a group of about 50, we furloughed 8, who continued without pay, qualified for unemployment benefits, but retained 100% health coverage. Two have returned to work already and we anticipate being more or less normal again in time to meet the loan forgiveness criteria.
It's good to have the database open to see -- and, hey, to double-check that we actually got it.
In the event that they did/do accept said money they did not earn, and that money was applied effectively and literally saved their asses in an emergency that they were not properly prepared for - they would never forget it and do whatever it took to repay this money that saved their life because they are grateful.
These examples do exist, I know personally know of some and maybe you do too...or not? But that's what I am getting at: everyone has different morals and values. Further, it's helpful to know what those are (when manifested into the form of a corporation) because then we get to make informed choices about who want to work for and with based on value systems. We vote every day with our feet, our dollars, and our attention.
Would I rather work for an employer who did what it took to navigate the Covid shitstorm on their own dime or the one who needed a lifeline and didn't even have the decency to pay back what was never theirs to begin with? Obviously.
Why do you think people are so interested in this data set? Many are acting on this intel in more ways than you think!
On the flip side, the way you "pay it back" to your Noble Investors is to keep the ship afloat and deliver a ROI with a healthy and competent team.
Increasing shareholder value and also doing the right thing and coming up with a way to give our furloughed teammates health benefits during a pandemic was, I suspect, an easy decision for senior staff to make. I'm a lowly scientist, I don't get to make those calls -- but you won't hear me complaining about this course we chose, either.
I don't know about that. Every accountant I knew urged their clients to apply — primarily because there were so many unknowns — at the worst of it, it seemed like things had a sincere chance of degrading into a real doomsday scenario.
I would argue that it would be outright irresponsible for a company to forgo applying for PPP. I wouldn't want to work for an employer who would choose to go against the advice of their financial advisors because they wanted make a point.
noun: loan; plural noun: loans
Is it just called a loan because that sounds better than just calling it a subsidy?It's a slow process (as I've been respectful of the rate-limit on the reverse geocoding API I'm using), but I finished mapping four states and hope to complete the other 46 by the end of this week.
I went and looked, before reading your second paragraph, and the clusters immediately jumped out, and it either seemed suspect or wrong. Then I had to come back here to see why it was wrong.
Examples:
All the ones in Ontario, Canada, e.g. Fullmer Construction, are really in Ontario, California.
The Christian Valley School on Artesia boulevard in Alberta was picked up instead of the one in Artesia, CA.
Simpson Labs is geocoded to Valencia, Spain instead of Valencia, CA.
GW Lawrence on Wilson street in Cordoba, Argentina instead of Cordoba, AR.
https://news.ycombinator.com/item?id=23763048
Is it possible to add a ggogle maps business name listing based on address next to the reported company name?
Cool project though.
You're right that it would be interesting to do analysis on population-adjusted loan amounts for different regions... maybe something like a loan $ per capita map?
What I think would be much more interesting is to see what businesses have physical B&M locations. In other words, cross reference Yelp/Google Places with the legal entity's address. Or maybe cross referenced against unemployment numbers by state/city (if that data exists).
Nit: what you're doing is geocoding, not reverse geocoding. Geocoding is the process of turning strings into lats/longs. Reverse is the reverse of that, namely lats/longs into strings.
>Philadelphia, to its own credit, is spelled at least 57 different ways in the PPP loan data
(an image is included, with various items, such as "PHIADELPHIA", "PHILADELPHIA,", and "PHILLY")
Pretty well sums up data science. He also notes that Chicago is spelled 31 ways (https://twitter.com/dataeditor/status/1280277322596311041).
But remember where it came from: thousands of lenders hand keying this stuff in with minimal guidance.
> We found 1 loan(s) for Y Combinator Research Inc meeting or exceeding the public reporting minimum of $150k.
> Loan Amount Range $150,000-350,000
> Business Name as Filed Y COMBINATOR RESEARCH, INC.
Is YC Research an entirely separate entity from YC core?
That said, it's apparently no longer associated with Y Combinator, and goes by OpenResearch now[2].
[1] https://www.guidestar.org/profile/81-0861414
[2] https://ycr.org/
https://blog.ycombinator.com/yc-research/
Also, maybe even funnier, is that the "Ayn Rand Institute" applied for a loan... that's the best thing in the database I've found so far.
edit: https://www.naics.com/code-search/?naicstrms=814110 "Private Households"
https://www.axios.com/paycheck-protection-program-disclosure...
Of particular reference here - startups that laid off employees and /then/ applied for a PPP loan
https://layoffs.fyi/2020/07/06/these-startups-received-ppp-b...
Aren't these exactly the companies that SHOULD have received PPP? They were clearly struggling and without the money were reducing head count already.
I do think that a bunch of this money ended up lining the coffers of businesses that had an "in" with a particular bank or a particularly tax person, just because that's the way these things end up working in practice.
I would have preferred a much more stream-lined European approach combined with much more direct cash to consumers than this roundabout way of doing it, but I don't think it was entirely ill-intentioned. But when you start taking into account executive pay, etc, some of it can start looking pretty shady.
This was a very smart way to bail out banks indirectly
At least PPP did not protect execs, but given that rank and file was saved, the execs got the reprieve too
There is no end in sight to either corona virus or the economic downturn, so it’s just throwing 8 weeks worth of taxpayer money into bad investments. What’s going to happen within 8 weeks to ensure these employees won’t just be let go again?
Because those same taxpayers voted in a government that prohibited many of those businesses from operating.
> There is no end in sight to either corona virus or the economic downturn, so it’s just throwing 8 weeks worth of taxpayer money into bad investments. What’s going to happen within 8 weeks to ensure these employees won’t just be let go again?
The purpose of the funds isn't to prevent future unemployment. It's to funnel funds to individuals who would otherwise be unemployed. The funds can only be used for payroll to be forgiven. So this is an unemployment payout by other means, in addition to the federal unemployment benefits that were expanded.
> The funds can only be used for payroll to be forgiven.
That an odd way to say up to 25% of the loan can be used for non-payroll expenses like business rent...why are businesses getting loans to pay rent if it’s about employees? Employees didn’t get money for rent.
If it was truly about “funneling funds to individuals” they could have just done that, not given it to businesses first with a 25% extra for non-payroll expenses.
Tax payer do own businesses due process under law and a respect for private property rights. In America, the government can’t seize a business without compensation. Mandatory shut downs, in the absence of financial assistance, is arguably a “taking” under the constitution and a violation of basic inalienable rights we as citizens each have.
As far as 25% being spend on other things. It’s kind of pointless to pay employees but not pay rent, get evicted, and have no place for them to go...kind of defeats the point. A restaurant kind of needs its physical location to operate and offer people jobs.
This isn’t about “funneling funds to individuals” that’s what unemployment insurance and stimulus checks were for. This was also about saving businesses so we don’t enter a depression.
False, government does this to businesses all the time and compensation isn’t due. Take hurricanes in Florida and mandatory shutdown/evacuation orders, there is no promised compensation.
Besides under imminent domain cases, I’d like to see some case law to support taxpayers bailing out businesses.
The existence of imminent domain proves my point, there are circumstances where tax payers owe An obligation to property owners and their actions are restricted by that obligation. Now we can argue about whether this specific act is a taking but I destroyed your blanket argument that tax payers don’t own business anything.
Own a business with a plot of land, tax payers want to expand a road and tear down your office and take the land? Can’t do it without paying.
Again feel free to cite any law supporting your argument: 1) the shutdown orders were a government taking of private property; And 2.) compensation for a temporary taking.
You missed the entire point of hurricanes, before any damage occurs governments order shutdowns and evacuations, there is no taking and there is no compensation for those shutdown and evacuation orders.
The time between evacuation order and landfall is at most four days. The economic damage from that phase is minor.
There are businesses in some parts of the US that are in their fourth month of being forcibly closed. The situation is not in any way, shape, or form comparable to a hurricane evacuation.
Your point of the hurricane is not persuasive, in that situation, the hurricane does the damage, the government order is ancillary. Here, the shut down order is more of a direct cause in the business harm.
Most states are re-opening, ill-advised or not, and businesses are being allowed to operate again.
It very much does. Amazing how much harder it's to stay in business when your revenue is 0.
Frame it in the alternative, why should businesses have their property seized by public health orders because the tax payers have decided that is the right social policy? Why should some individuals be deprived of liberty and property?
And no, government ordered shutdowns are not taking of private property, it’s done all the time for Natural disasters And taxpayers don’t bail out the businesses. Not to mention business don’t have “licenses” from the state, they may be incorporated and organized, but that wasn’t a requirement of the PPP loans, independent contractors were eligible and didn’t need a separate business entity to qualify for PPP.
Recruiting and hiring is hard. No one wants to lay people off.
The rules of PPP also require maintaining the same number of full time employees in order to receive full forgiveness. Any company that received funds and then reduced staff will not have full amount forgivable.
[0]: https://pppreport.org/company/gerber+kawasaki+inc
[1]: https://www.naics.com/code-search/?naicstrms=441228
I wonder how many of them were sitting on millions or tens or even hundreds of millions of deceptively obtained ICO funds at the time they obtained these 'loans'.
E.g. I see at least one that raised over 100k BTC in ICO funding just couple years ago.
So if they had that revenue and also paid payroll to employees in 2019, they would be eligible.
The 2018 ones were screwed though, too far back. They probably exhausted a lot of their runway on marketing and extortionate exchanges.
Blockchain community is unique in that they treat $5-10 million raises as "forever money" for an indefinite time period, when even Series A tech companies would not be expected to last more than 15-18 months.
So there are a lot of misalignments in that sector, which are poorly understood by both the people in the sector, as well as critics outside of the sector.
The issuers themselves often have good legal help and proper accounting, as it is a tricky regulatory environment to begin with, which exacerbates these misalignments with their purchasers and psychological investors.
That hasn't been my experience, instead my experience is that many of these companies went through large numbers of lawyers who told them what they wanted to do would be likely found to be illegal before finding some that would sign off on it.
> "forever money" for an indefinite time period
For the most part this is because they don't deliver anything useful, so they won't get any more (at least not until they spin up a new operation under another name).
Some of the companies I see in that database have principals who are on their third or more failed blockchain/ico and hey have become exceedingly efficient at it.
This is continued because nobody can talk about it as they will immediately get delisted, the community will point fingers at the project team, AND the regulators will view the issuer as promising liquidity which further moves their asset into unregistered securities land, opening them to sanctions for the sale and promotion.
Ultimately the token traders and critics have no clue what's going on and think the founders have to be married to a software project with a runway that lasts forever because software development shouldn't be that expensive.
Yes selling tokens is a viable revenue event, but not a recurring revenue event for that project. So launching new projects is the only way to do that, and prior experience is more important to the actual investors providing the bankroll who make a lot of money putting these together. Many people are buying them for the wrong reasons, and there totally could be a market of the same size of people buying them without an expectation of profit.
It is an entirely viable business to make a website with one button that says "purchase button tokens to vote on the CSS color of this button by staking!", which I think should be recognized.
Even the concept of "failed" is misaligned and more often related to exchange rates and volume of the token, more than whether the team did anything.
There is a whole other market of investors bankrolling the parent organizations that are churning out ICOs, because all they see are highly scalable revenues and a multiple of that.
The people buying them need to be more discerning if they want a different result. Token issuance is primarily a game of entertainment and placating a community, and it should be put in that category. Or the community should be an active participant in making the token more useful and valuable.
They certainly do have employees and would be eligible for PPP. If they lied and are in a game of chronic fraud, now featuring the US Treasury, that's pretty risky!
- more costs for financial aid
- more costs for cleaning and retrofitting facilities
- more costs for experts on reopening safely
- more costs for online education programs (software, training, etc)
- refunds of after-school programs, field trips, etc.
- fewer donations from alumni
The only thing that's really improved is maybe utilities? They 100% would have laid off teachers if they didn't get the PPP. It's ludicrous that people are begrudging schools for using this program exactly as intended.
If you give people at the bottom a choice to not work, by giving them cash directly, then they would have better negotiating power versus employers.
The employers would then have to raise wages, and therefore prices. That means consumers who were proportionally consuming more than others have to consume less as more of the wealth goes towards paying higher wages. And we don’t want that as a society.
So we make the aid contingent upon an employer who might bless you with a furlough so you can collect the temporary generous unemployment, but also yank it away in case your menial work is necessary and they can go back to paying you near minimum living wages.
My point was the argument that the government design PPP as an effort to perpetuate an existing system that reduces employees bargaining power and prefers businesses can’t be supported when the government specifically strengthen employees bargaining power.
The powers that be know that loans obligations have been made that can only be satisfied if labor costs remain contained. Their primary objective is to make sure the mortgages keep getting paid, and paying employees double would endanger that.
An easy illustration is the fact that “essential” employees at much higher risk of getting the virus are getting paid with their old near minimum wage per hour jobs with signs that say “heroes work here”, and their management bosses are working safely at home with minimal risk of covid earning the same pay.
White collar employees continue to earn higher salaries from the safety of their home, and “hero” janitors and housekeepers are getting the same $10 to $15 they received as before, except they get to deal with higher chances of coronavirus.
I suspect what you would find is not some grand conspiracy but emergent properties from competitive forces.
And a lone businessman can’t just pay workers more and make the world right. If I decide to pay people more, and run the numbers and figure out I can afford to spend $5M on a piece of land to develop, and my competitor decides to project paying people much less, they can afford to spend $6M for the same piece of land. So guess which business ends up existing? The one that doesn’t pay higher wages. Same situation with people choosing to shop at stores that offer lower prices.
It would have to be a nationwide effort to transfer wealth, such as UBI or higher minimum wages. Otherwise we keep going as is with an ever widening wealth/income gap.
These loans don't cause unemployment. Those same people would be unemployed even if those same businesses didn't apply for the loan.
We are only a few months into a multi year pandemic, so even if a company isn't suffering yet, they most likely will be soon. Getting a loan while it is available to preserve jobs as long as possible as the pandemic gets worse sounds like a sensible and ethical thing to do.
I would never announce a financial problem or ever publicly announce employees let go. It would harm my contracts with vendors.
I just searched my local city and noticed that our (for profit) ambulance service received a loan:
> DIAZ MEMORIAL AMBULANCE SERVICE INC
I definitely don't think they saw the number of ambulance rides go down. And also don't think their profits suffered.
I'm friends with an ER nurse and she was saying that the ER was almost completely empty during the first few weeks of COVID-19 because everyone was staying home out of fear.
Probably because there's no way he could possibly know what "business as usual" was for any company where he wasn't employed. He has no idea what each company's financial situation is and is merely spouting cynicism.
I definitely don't think they saw the number of ambulance rides go down.
Is this something you monitor? Is there even a way to do that with a private ambulance company?
Considering the number of medical providers, doctors' offices, and hospitals that had business plummet to catastrophic levels, I think you're imagining things.
I work in healthcare, and just off the top of my head can think of several medical clinics and pharmacies that shut down because of pandemic-induced financial difficulties.
People who would otherwise have gone to the ER, even if not strictly necessary, were hesitating, "do I really need to go, perhaps not".
And then on the other side, you had people who really _should_ go not wanting to, due to fear.
Both ambulance services in my county were shutting down ambulances and furloughing employees heavily.
-- a paramedic
I wouldn't be surprised to learn that emergencies are a small portion of what ambulances are used for, but I don't have access to that data.
But let’s assume your premise; it’s likely their costs went up dramatically between Personal protective equipment, hazard pay, quarantine procedures for exposed employees etc.
Ambulance services are capital intensive (ie large Debt payments) and low margin. A 20% drop in revenue would bankrupt the company.
Covid hasn't been prevalent enough to increase ER visits in most of the country (until now) and other people have been avoiding going to the ER unless on deaths door. Not to mention the lack of driving has probably plummeted car accident rates. I remember reading that organ donors are in short supply.
We have 100,000 people dead in this country, million dollar hospital bills for those on vents, and yet the stream of cash continues to flow to those too stupid to save a few months of operating expenses/payroll. What a trash society the US has become.
Again, I can't stress how important time was. I study and work in financial engineering, and from what I've seen and directly experienced in the depth of the crisis, we were days from total seizure in the financial system. The only part that was still doing ok was banking (due to what happened after 2008). Adding to that, since it's much harder to just give millions of dollars of loans to anyone who demands than it is to give 2000$ per person through the IRS, you had to have a system to vet, check and analyse claims. That's exactly what banks were able to do almost immediately with minimal adjustments.
I agree that it is far from ideal for the private sector to such a big influence on a public program. But perfect is the enemy of good, especially considering the incredible human misery that failing could've led to.
I also wish they would think about the consequences of no action. They probably don’t realize that cascade bank failures and supply chain disruptions happen fast and become permanent. In March there was a realistic possibility of systematic seizure of finance and the supply chain grinding to a total halt due to lack of financing. How do you stock groceries when they can’t buy inventory?
I would've been okay-ish with the arrangement if there was some narrow qualification criteria like being in the grocery business or medical supply chain, etc.
Fine dining restaurants: not essential Summer camps: not essential Non-profits: not essential Law firms: not essential either!
And yet we paid them millions... _why?_
I picked a random company from the 150k list. A pizza place, around the corner. Been in business since 2007. They received $150,000-350,000. So a place deemed essential by the governor and that's permitted to operate curbside and takeout delivery after being open for 13 years is eligible for 150k? What kind of drugs are we on?
Now I've heard people argue that compensation for lost salaries should've been paid directly to the employees if they lost their jobs. But to put it mildly, recovery and return back to normal would have been extraordinarily harder if most of the non essential parts of the economy don't exist anymore.
The price of letting everything go bankrupt only to reopen from scratch later is enormous and would amount to incredible waste not only of money but also years of work. The 150k may have been way too much for a local pizzeria, but it's better to overshoot than to aim for much better money allocation and risk losing precious time. You have to keep in mind that not only do businesses have to pay back the loans (if the money didn't go to salaries) but also that we will have ample time to take a closer look at each individual claim and punish fraud retroactively. The process is already starting as we can see with the linked website.
At the end of the day, we just couldn't afford to have a better PPP program because no matter how much money we lose on fraud and waste, the alternative would have always been more expensive.
Do you have a better suggestion? I doubt it. There are to many edge cases in business to create a program that will be perfect. So your alternative is to take the risk of mass bankruptcies. If PPP designers and law makers are wrong billions are wasted. If your approach tested and is wrong, the economy is wrecked. Decision is easy when framed that way.
That's a bit of a harsh take. Lots of businesses took out these loans preemptively because they knew the money would dry up soon. Both the company I work for and our family business had applications ready to go the minute they could be filed because it was clear that the application process was going to be a mess.
I agree with you that the forgiveness should be tied to an ownership stake in the business, and that dispersal of funds should have only happened with demonstrable need of funds. But the people involved knew this was going to be a handout and acted accordingly. Taking these funds is an indicator of good business sense, not poor.
Meanwhile the government can borrow money at almost negative rates, based on long term tax collections, and arbitrage short term financial harm and need against long term repayment. Seems like a rational thing to do.
Your underlying point is well made, but it's important to understand the process: The banks issued the loans, but the federal Small Business Association reviewed and approved them.
> yet the stream of cash continues to flow to those too stupid to save a few months of operating expenses/payroll.
You can disagree with the program, but the comment is overly hash, IMHO. As a business owner, I see the program as a lifeline to handle cashflow issues and retain workers. I'm not sure that is a "trash society."
This money needed to be added to the economy, and really still does. I think PPP was one such reasonable approach (though much more is needed to save small/medium businesses).
If I was running a business and the government told me it was illegal for me to make money for the forseeable future, I would damn well want them to compensate me for that.
Would you rather have our politicians deciding this?
https://pppreport.org/location/CA/CAMPBELL
Most of the rest here look pretty legit as far as I can tell. The carwash got 3 loans which seems a little fishy? but to be fair they are a very busy one with a lot of employees.
https://pppreport.org/company/o+reilly+media+inc
They seem like a company where most people can work from home.
EDIT: I totally forgot about their conference business. That makes more sense.
That's probably true, but the PPP loan covers economic impacts as a result of COVID-19, which can be things like "nobody wants to buy our books that are primarily sold as training materials." 340 people might include sales or actual book production, but it's hard to say without more transparency what the money actually went to/for.
Linked from this page: https://home.treasury.gov/policy-issues/cares-act/assistance...
You'll need to click on the ID link and then click to see the loans from that institution - e.g. from https://sba-loans-covid-19.datasettes.com/loans_150k_plus/Le...
https://pppreport.org/company/snappy+nails+s+p+a+9+inc
Damn.
https://pppreport.org/company/connelly+chiropractic+inc
How they got that much money in the first place is a definite mystery though.
You can filter by state, city, zipcode, bank, business type, and search by employer name, e.g. https://sba-loans-covid-19.datasettes.com/loans_150k_plus/fo...
You can run your own SQL queries against it. Here's a query I wrote that shows the most common NAICS codes (industry categorization from the census):
https://sba-loans-covid-19.datasettes.com/loans_150k_plus?sq...
You can click through from there to get faceted search of e.g. every loan made to a dentist:
https://sba-loans-covid-19.datasettes.com/loans_150k_plus/fo...
I have full notes about how I built this here: https://github.com/simonw/sba-loans-covid-19-datasette
And it still could! I think things will get very dark very fast if Congress doesn't extend at least some of the $600 / week unemployment benefits.
You ain't seen nothing yet.
And you're already preparing to shift the blame towards the people critical of that approach.
https://pppreport.org/location/TN/NASHVILLE
Edit to add: further down the list I am seeing tech co's that actually laid off large % of employees that received millions still.
They probably were not counting on this information becoming public (though it obviously is/should be by default)...any respect I may have had for them is no more. Disgusting behavior.
Full screen - https://www.dannysalzman.com/files/ppp_map_v1
Warning - large file download (128mb) doesn't work well on mobile
-list contains any company with a ticker [current/previous OTC stock or other]
-likely to contain many false associations, but still full of surprises
Edit: I tried accessing some common endpoints like /about to see if there are any unlinked pages, but could not find any. Hence why I asked the question.
Direct link: https://sba.app.box.com/s/tvb0v5i57oa8gc6b5dcm9cyw7y2ms6pp
CNBC article: https://www.cnbc.com/2020/07/06/coronavirus-stimulus-list-of...
It appears the database may include applicants who submitted partial applications but may not have actually received funds. For example, Index Ventures is in the database but claims they didn't take any loans. From the cnbc article:
> The venture capital firms Index Ventures and Foundation Capital, along with the scooter company Bird, said that they did not apply for the Payroll Protection Program, despite being listed in the database as having been approved for millions of dollars of funds from banks under that federally run program.
My company, a recruitment agency, took 2 to 5 million in these loans and kept me hired . But since my main client kept me hired , the recruitment agency kept paying me. So did this recruitment agency just make 2-5 million in free money - just by proving that they ran my payroll- which they did. because the client kept me hired anyway.
I think there are quite a few companies like this. Hence “money goes to those who least need it”.
If I had implemented the plan, I would have just created a program where the program only covered a % of the wages (say 80% instead of 100%) and mostly only for people who were not able to work. Of course, that brings other problems, but there is a middle ground somewhere in there.
On reflection, though, not so surprising.
Maybe you're thinking the lender field is the category of the company?
Financing for startups has probably totally dried up. I bet a lot of VCs said: "We don't have any more funding for you, but try this approach..." And, they recommended going after PPP and at the same time recommended firing people to slim down the salary burden, but only after the PPP loan was safely in place. That extra time could be a lifeline for a startup.
I think this is what happened to me.
Let’s not be so quick to label everything fraud, or greed. Sure some people will misuse funds. But most wont. Most people are good.
Examples like law firms or physicians' offices. These are relatively small firms with very wealthy principals. They are asking for taxpayer money to maintain their wealthy lifestyles, so they don't have to sacrifice their Bentleys to pay staffers. Examples: Thomas J Henry in San Antonio.
LLCs and franchisees that probably have millions of dollars in holdings and cash, but act under the guise of "small business" because they operate fast food or something.
Religious organizations. It's one thing if something like a local YMCA gets funds, but a church outright getting funds without proving it is going to public services (why don't we just have better public services?) is not proper. Churches already don't pay taxes.
They still have to pay their employees, which is the point of the PPP. Those employees are paid from the funds that come in via donations, which are likely down during the pandemic (especially when many couldn't hold services). Put more simply, their income is down the same way my employer's is, as a result of the pandemic.
> a church outright getting funds without proving it is going to public services
The requirements of the PPP require that at least 60% must go to salaries.
> Churches already don't pay taxes.
Their employees do.
My understanding was that 60% of what you don't have to pay back goes to salary. The money that went to salaries and an additional 67% you just keep. Is that right?
I work for a firm where staff took 20% pay cuts, partners took much larger cuts and the principals likely will not be paid at all this year. I had to lay off a dozen people personally. Other firms took similar or more extreme measures. Law firms are getting hit fairly hard like a lot of other businesses. We didn't take PPP funds, but if we did and it saved some of the 70 of my coworkers who lost their job in the worst economy anyone alive today can remember, then I wouldn't feel the least bit guilty about it.
Nobody is buying used Bentley's so I don't know where you get the idea that someone can just liquidate one to pay employees. And why should someone have to liquidate personal possessions to pay someone else anyway?
What franchisee do you know who is sitting on millions in cash? It doesn't work that way. Someone who franchises a fast food place makes an enormous investment, takes a significant risk, works their ass off and then pays substantial fees to the company. These are generally small business owners.
The issue is there's serious moral hazard where owners of a private business can, rather than maintaining a balance in the business, pay themselves the cash, then grovel to the public to bail them out. If you're socializing the risk, you shouldn't get to privatize the reward.
The fact that the fixed expenses during this pandemic did not stop for corporations made the expense of payroll which provided significantly reduced revenue stand out. Even law offices and physicians have very high recurring expenses like insurance that they just can't stop and start on a dime and stay in business. It made no sense to keep people on the books until PPP gave a compelling reason to do so. It isn't about 'keeping a wealthy lifestyle' as much as 'keeping a functioning business' a lawyer or physician with no practice is just as much a drag on the economy as anyone else.
The one comforting limitation was that payroll calculations were capped at $100k. So if you had 10 people with a $250k salary, the maximum loan amount is calculated based on having a salary of $100k.
Although you're allowed to add in the cost of healthcare and 401k contributions without limitation.
I think the $100k cap was quite generous and probably too high.
One way or another the government is going to pay to keep these people employed.
Seems like even if you didn't need a PPP loan for staff, there are opportunities to create a scenario where it appears justified you need to loan to cover employees salaries, then divert the previous capital for your labor to an opportunistic expansion while others are scraping by. You got a large loan, with low interest, during a time period many were struggling. Great way to accumulate wealth.
They only have to be paid back if you end up firing the workers you were supposed to keep employed with the loan. If they stay employed then your "loan" is fully forgiven.
> The Paycheck Protection Program is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll. SBA will forgive loans if all employee retention criteria are met, and the funds are used for eligible expenses.
https://www.sba.gov/funding-programs/loans/coronavirus-relie...
You get that they'll keep the Bentley's and they just won't pay staffers? This program was the easiest way to keep people getting paid.
> LLCs and franchisees that probably have millions of dollars in holdings and cash,
Your "probably" is doing a lot of work there. You don't really have any idea. But the issue is you wan't "wealthy" corporations to bear the brunt of the economic shutdown. But why single them out? The PPP is an imperfect and blunt way to socialize the costs of the shutdown.
To see how deep money and time-saving habits run, watch this documentary about Warren Buffet, where he goes to McDonald's and gets a cheap meal. https://www.youtube.com/watch?v=PB5krSvFAPY (3 minutes in)
The former I can shrug off as insignificant, the latter is mildly terrifying and makes you wonder how the hell we can trust anything the government does when they can't even take care of keeping track of triple billons of dollars of other people's ... namely, people who did not get any stimulus ... money.
But I guess the bureaucrats and kleptocratic government must have been ramping it up after the billions upon billions they "lost" in Iraq without a trace. This is probably going to turn into politicians and bureaucrats throwing up their hands when companies claim that the information is inaccurate and they owe nothing and the government cannot prove anything, a la, housing fraud.
You can get the de-identified data by state for loans under 150k: https://home.treasury.gov/policy-issues/cares-act/assistance...
edit: I swear I can type
Do you mean "over" $150k? Parent's loan was <$150k.
https://pppreport.org/about.php > Details for loans under $150,000 remain mostly private, though industry codes and issuing bank details are available.
Looks like even Adult Entertainment businesses got money through Paycheck Protection Program. Example: https://pppreport.org/company/11000+reeder+l+l+c
https://www.natlawreview.com/article/federal-courts-side-str...