If your small business died, blame President Donald Trump
Show Caption Hide Caption Mnuchin candid to restarting talks with Pelosi
Pressed by Democrats to cursorily negotiate a new coronavirus stand-in box, Treasury Secretary Steven Mnuchin said the administration remains will to work on a bipartisan agreement to aid small businesses, the unemployed, and schools. ( Sept. 1 ) AP Corrections & Clarifications : This column has been updated to clarify that PPP loans are excusable and clarifies the writer ‘s views on the program ‘s utility to little businesses. This translation besides clarifies how IRS guidance may increase a company ‘s tax effect if it uses PPP funds for lawful business expenses. additionally, a previous adaptation of this column misidentified the governing agency that made changes to Economic Injury Disaster Loans. If your humble business died in the death six months, blame Trump. If your small business is suffering, blame Trump. It wasn ’ triiodothyronine COVID-19. President Donald Trump could have rescued American small businesses, but he didn ’ thymine. And this workweek, he could help save hundreds of thousands more if he took action, but he won ’ thymine. I ’ ve been closely monitoring what has – and has not – been done for little businesses since the begin of the pandemic. And at virtually every turn, Trump and his administration ignored the needs of little businesses or actually made it harder for them to survive. His continuing refusal to develop a national policy and coordinated response to the pandemic has turned what could have been a limited closure into a long, lingering economic disaster. The bad may be yet to come. Small biz & USPS: Many small businesses rely on the US Postal Service to compete, stay afloat How does a sweet potato café survive?: This Black-owned small commercial enterprise in Detroit is battling odds. It ’ s about impossible to know the exact number of modest businesses permanently shuttered since March, but it ’ second at least in the hundreds of thousands. About 73,000 businesses on yelp closed for good by June – and Yelp merely deals with a bantam percentage of small businesses. According to the Census, one-third of small businesses have experienced a “ large veto impact ” and another one-half “ moderate minus impact. ” Let ’ s spirit at some of the many ways this government – along with Senate Republicans who followed the president ’ s head – have abandoned little businesses. ► No national “Small Business Recovery Plan.” The major broadcast to help little businesses was the Payroll Protection Program. Look at that name – the program was designed to keep workers off unemployment, not save modest businesses. The administration never proposed a program to directly help small businesses survive. Funds from the PPP loan program are excusable if companies meet certain guidelines including using the money for payroll costs, concern on mortgages, lease and utilities. Small occupation owners did n’t view the PPP as a concede. The forgiveness rules were based on maintaining at least 75 % of payroll costs ( late lowered to 60 % ). many were unwilling to take on debt when they were uncertain of what the future would bring. And those with not-so-good credit were afraid they would not qualify for a lend. Having the administration provide direct aid in the form of no-strings-attached grants would have alleviated humble business owners ’ concerns. ► Loans, not grants, for small businesses. Both the PPP and Economic Injury Disaster Loan ( EIDL ) were structured as loans. Compare that to what Senators Ben Cardin, D-Md., and Ron Wyden, D-Ore., proposed the “ Save America ’ mho Main Street Act, ” which would have given send grants to small businesses.
meanwhile, what was the president saying ? “ We have to save these companies. These are companies that weren ’ metric ton in trouble three weeks ago, and now they ’ re in perturb because of what happened. ” unfortunately, he was vigorously advocating for a bail-out for huge corporations – which then received an allotment – including $ 27 billion – primarily in grants – for the airline industry. ► PPP administered by banks, not the Small Business Administration. The botched rollout of the PPP is well documented, with bombastic corporations pushing humble businesses out of the way. This was predictable. Banks weren ’ thymine equipped to deal with small businesses in these numbers and were probably to give predilection to their best ( biggest ) clients. At the time the PPP was proposed, minor commercial enterprise organizations urged the administration to advocate what european countries adopted, lineal serve from the government. But they were clearly looking out for big banks, who made between $ 14- $ 24 billion in fees. ► Effectively made expenses paid for with PPP funds taxable. Congress indicated that PPP loan forgiveness amounts were not to be taxable. Treasury Secretary Steven Mnuchin defended a notice from the IRS saying expenses used to justify PPP forgiveness would not be tax-deductible. Let ‘s say a business received $ 50,000 in PPP funds and now can not deduct $ 50,000 in lawful business expenses ( payroll, lease, etc. ) used to justify PPP forgiveness, the PPP is basically increasing the taxable sum of income for that commercial enterprise by $ 50,000. account groups stated this is reversing Congress ‘ purpose. ► Unnecessarily complicated PPP forgiveness process. Leading conservative business groups, including bankers and account associations, urged reducing the programs red tape for little businesses, estimating the Trump presidency rules cost little companies thousands of dollars. ► Reduction of EIDL grants. The only “ accord ” for belittled companies was $ 10,000 for advances for EIDL loans. The SBA decided that this meant only $ 1,000 for each employee retained, importantly lowering the sum of award money available to the smallest of businesses. But possibly the president ’ mho biggest failure is his inadequate reception to the virus itself. Trump declared he was going to be “ a wartime president. ” We had an invader in our land – a virus – but Trump was, and is, unwilling to develop a national program to fight that invader. Grants: Lowe ‘s giving out coronavirus humble business relief grants up to $ 20,000 through nonprofit LISC Assistance: Capital One, GoFundMe and others launch group to support humble businesses through a consumer movement “ Leadership from the administration in those early months could have prevented this crisis from becoming a catastrophe, ” said Amanda Ballantyne, executive film director of Main Street Alliance. “ And when we last had a closure, that time was squandered. ” Ballantyne warns the worst may be so far to come. “ We think the lineage bath is going to be third quarter, ” as PPP and unemployment monies run out, stretched-thin express and local governments lay off workers, and the strong weather that propped up humble eat-outside restaurants and other outdoor activities end. modest business owners see what this president of the united states refuses to acknowledge : The health of the economy is linked to getting the virus under control. With deaths from coronavirus in the hundreds of thousands, people will not feel safe. And until people feel condom, the very economy ( not Wall Street ) will not recover. More little businesses will close shop. Without strong e-commerce presence: Ross Stores and Burlington are struggling through COVID-19
This workweek, Congress is back in session, and Trump could be advocating real relief for small businesses. Imagine how much better off minor businesses would be if we had a president of the united states and administration that actually cared about small businesses. Rhonda Abrams is the writer of “ Successful Business design : Secrets & Strategies, ” the best-selling business plan guide in the U.S., recently named one of the 100 best business strategy books of all time. Follow Rhonda on Twitter and Instagram : @ RhondaAbrams. The views and opinions expressed in this column are the author ’ mho and do not necessarily reflect those of USA TODAY .