Congress has approved two rounds of PPP loans, but many small businesses are still struggling
to get the help they need. I decided to find out why.
Here in New York City, the small businesses greet you by name with a wisecrack and an
eye roll. Sparring over a bacon egg and cheese is part of the charm of New York! But during
the pandemic, nearly one third of these businesses may end up closing forever. And across the
U.S., millions of small businesses are struggling, so the federal government launched something
called PPP. It was supposed to give mom and pop shops forgivable loans, but well, you
know how the meme goes. While PPP worked for some, others felt, how do you say… differently.
- It sucked. - It's just f***ed up.
- Yeah, it was a s***show, Wow! I haven't seen New Yorkers this peeved
since, well, this morning. God, I love this city. To find out more, I sat down with Ashley
Harrington of the Center for Responsible Lending—no, it's not an oxymoron; it really does exist.
- This program from the very beginning has had a number of flaws. That’s both in the
structure but also the implementation. So you had banks who are prioritizing their wealthier,
well-connected clients because of the way the program was set up. It made more sense.
They could get more money from serving huge businesses who had larger payrolls.
That’s great, but the piece is largely about New Yorkers, too. So do you mind just, like,
adding “you f***ing f***” to, like, everything you just said?
So under the glassy-eyed gaze of Secretary Mnuchin, instead of helping out our mom and
pop friends, $500 billion with a “b” mostly went to larger businesses like TGI Fridays,
P.F. Chang’s, and other places that hosted sad work happy hours in the before times.
- What ended up happening was all the bigger guys getting a part of the loans before our
small mom and pop stores in Chinatown did. Da f***?
“Da f***” is right. Because it gets worse. - That is part of the story, the big businesses
who got huge checks. But for us, I think what this program does is it highlights the systemic
inequities, the systemic racism that plague our entire system.
What kind of systemic racism? Well, first, let's look at the application.
- It was only in English while a lot of the business owners down here are Chinese. So
they couldn't even read it. PPP rules prevented business owners with a
criminal history from receiving aid. - I was filling out the application for it
and a question popped up. You know, “Have you ever been convicted of a felony?’’
You are at CONBODY. It’s a prison-style bootcamp where we hire people coming out of
the prison system to teach fitness classes. Anybody that’s been convicted of any type
of crime, you know, that’s applying for a PPP loan, they’re saying I couldn’t
get it. And if you were a new business, you barely
got a dime. Bootstraps be damned! - I got like $300 total. We can buy a small
bag of rice for $300, maybe. If you were eligible, the banks made it a
full-time job to even apply. - You have to put all of these documents together.
Nobody gives you a clear answer. The bank’s like, “Oh no, you don’t qualify.” My
emotional language is in Spanish, so I just started, like, cursing in Spanish. I’m like,
“What are you talking about?” Like, I bank with you! “Okay, you should go to this
other bank.” Then we went to the other bank, and they’re like, “Oh no, you need to
have an account with us.” Es una mamada lo que está pasando. O sea, no mamen. It’s
disgusting. Unfortunately, we had to close our brick and mortar store. The store that
I closed, I still owe many months of rent, Perhaps the biggest issue: if you didn't have
people on your payroll, you couldn't get the money. And no, they didn't count bodega cats
as people, I asked. Ridiculous. - The vast majority of small businesses in
this country are mom and pop shops. You know, they are really small businesses where the
owner is the only full-time employee. And yet, the Trump administration literally made
a rule that said for the first week of that first round, these businesses could not even
apply for relief. What?! That means that 95% of Black-owned
businesses and 91% of Latino-owned businesses, many of which are true family-owned operations,
couldn't even apply. - It really was for the people who knew how
to navigate the system in the first place. So, it wasn’t really designed for the true
small businesses who really needed the help. According to one study, this resulted in a
41% decline in Black-owned and a 32% decline in Latino-owned active businesses, compared
with only a 17% decline in white ones. Look, I'm no math whiz, but this seems to add up
to systemic racism to me! - The problem with that is, Sam, you know,
banks in this country—the financial market in this country—has never been inclusive.
It has always excluded people of color and communities of color.
Okay. I’m going to ask you something that my therapist asks me at least twice a week.
“How do we do better?” - I think whenever these programs are implemented,
who is at that table, who is determining how this is implemented and rolled out, absolutely
matters. Small businesses are the lifeblood of their communities. They bring in billions
of dollars every year, provide millions of jobs. If they had taken a moment and looked
at how small business lending worked and how small businesses looked in this country, they
could have rolled out a program that worked. These businesses are our communities. And
after giving so much, they now have something they'd like to ask for:
- You hear all the time, “Small businesses are the backbone of economies.” But you
need to show that. - If you want to help the small businesses,
go really into the community where the small businesses are.
- Maybe with this new administration, you know, things can happen.
And what’s their message to the government if they don’t start making changes to PPP?
- You can go f*** yourself. - F*** those people.
- Es una ch******** lo que están—,