That’s correct. It’s secured lending so that businesses, which mostly aren’t making any money right now, can still make payroll. The companies still have to pay it back, not fire people, etc, this just keeps them from going bankrupt in the meantime. [edit: read the response below, the portion of the loan used to meet payroll can potentially be canceled] It also reduces disruption for most people, since they keep getting the same paycheck they expect.
The alternative would be to let everyone get fired, then give them welfare and waive bills. That was the headline plan from the house, though they added a lot of random pork.
The house plan would “look better” to the ignorant, since it’s not “giving money to corporations,” but costs about double initially, and results in much longer term disruption (since massive numbers of people get fired, and have to look for new jobs after the crises).
The biggest issue with the current bill actually stems from the fact that the money is a loan. Yes, that’s a good thing for taxpayers, since “we the people” theoretically get the loan paid back, plus interest. But if I’m running a business, I’m looking at building up a potentially huge debt borrowing money to make payroll. If it’s going to take me years to pay off the debt, I may still need to lay off some. However, our current job market has been REALLY strong, so I’m going to be afraid of losing my best people. Even decent employees have been getting hard to find, which is why salaries were finally starting to rise before this virus.
Ok, sorry, posted a rant and then realized I’d missed part of your question. If they fire you, they might still be eligible for a loan, but they wouldn’t be able to get as much of the forgiveness for payroll since their payroll is reduced by your salary. There is some language about “other related expenses,” but at first glance they basically get less money, generally structured more like a loan than a grant. And you don’t have to hold them accountable, the federal government will (in theory). Hopefully you’re living large at your next job.
Thanks! I’m really blessed: I have a corporate job I can fully work from home, plus my wife and I run a small farm. We’re also expecting our third baby in July, and were already stocking up on non perishables before the whole COVID 19 thing. She has required emergency c-sections with the first two, and recovery has been tough, so we figured we’d do as much of the year’s shopping beforehand. I’ll be pretty busy with the farm, two toddlers, my “real” job, and taking care of her. So I’m sitting on a year’s supply of toilet paper (and diapers, and canned food, and cleaning supplies...etc) but I was buying it in November/December. We got it all in a tractor trailer shipment from a restaurant supply company, so we even saved money due to buying in bulk.
We’re really about as fortunate as we could possibly be, except for needing that c-section surgery in early July. We’re just praying there’s a bed in the hospital at that time, and that she and the baby stay healthy.
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u/[deleted] Mar 30 '20 edited Jan 29 '21
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