- Jun 6, 2007
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On this latest Corona-Virus Rescue bill, the SBA expansion bill, what really stands out to me on the impasse in getting it through is how irresponsible the Democrats are from a financial stewardship role. For the expenditure numbers they seem to just pull them out of the air whatever they feel it should be they make it that isn't responsibility! Do they consider the country's broke the bill they are creating here will be paid by our and our friends children and future generations of their children, decency requires them to keep the bill as low as possible. Take for instance the $150 billion expenditure they want in the bill for state and county aid from the corona-virus crisis. It is fair to say the tax shortfall on the states and counties isn't their fault it is from a viral pandemic, like a natural disaster which caused the Federal gov't to shut down their economies for health safety reasons, it is right and good to make these gov't entities whole. Okay, financial experts can estimate fairly accurately the tax revenue these state level municipalities will be losing; PA estimate 2.7B to 3.7B, NY estimate 10B, SC estimate 1B, Ct estimate 1.4B, etc.. Now in the CARES act the Federal government gave the states $150 billion, why the hell are we giving them more money the trajectory of the disease has not materially changed; this prior aid level looks decent take IN tax loss for March $700 million, my reasonable calculation doubling that loss for each month for the balance of the year total loss $1.4 billion - CARES ACT gives them $2.4 billion okay they have an extra billion for response for corona response expenses and cover the margin of errors here; the Federal Gov't made them whole. Bottom line Democrats shouldn't be seeking more money for states at the current time they have been taken care of with the CARES Act. Democrats have some general legitimacy with county aid but compute the aid by running the numbers financial experts can estimate their tax losses pretty accurately. So as to be fair as a reasonable person can not giving undue amount to wealthy counties have the legislation adopt a formula where the top five largest cities in each state are made whole directly for the balance of the counties within the state compute the loss per person per county for those counties that have a loss per person way out of proportion to the average county cram down that number to the top of the 80 percentile of all counties than add up the total loss of all the state's counties (minus the five excluded) with the crammed down figure and then divide this number by the total number of people living in these considered counties - then you got your per person loss and go back and calculate the adjusted loss per county and once you do this across the nation you have your fair county aid number.
The Democrats would like to increase the level of the funding in the SBA grant program, that is reasonable it is a responsible program giving $10 K grants to small business hurt be economy shutdown over Covid 19. Democrats how about calculating that number in a reasonable manner like the current program is funded at $10 billion now the original SBA program was funded at $350 billion and Republicans want to increase it by $250 billion so they are requesting to increase it by seventy-two percent so request to increase the grant program by the same percent which would be $7.2 billion. Democrats want to help healthcare providers hurt by the crisis. Prior legislation has given aid to this group; now instead of just pulling a number out of thin air why don't you push for a program where you run it through the SBA where you have a $100 billion loan program that is a loan forgiveness program set up the health care provider borrower gets loan forgiveness on its cash flow losses for the year that way there is no speculation we know exactly what the crisis cost the health care provider and the Federal Gov't is making them whole! As for the Democrats claim that SBA lenders are being unfair if not discriminatory to some small business borrowers and so they want to use Community Development Financial Institutions to do a significant lending. Democrats haven't made a persuasive case for this side program. All indications are that small business lenders are swamped and of course management has a duty to look out for the long-term interest of the business which is leading them to take care of past customers first. Of course with the numbers of borrowers seeking and getting these loans these banks are draining their capital at concerning rates. The good thing is that the Federal Reserve Bank has committed to take these SBA loans off their books so these banks can loan more surely the system needs to be given time to be working smoothly. SBA approved banks are trustworthy the American taxpayer doesn't want to see significant fraud with the use of a group of Banks that have not been vetted to handle this big responsibility. If the SBA program doesn't have protections against borrower abuse why don't Democrats have the legislation add them require SBA banks to put loan rejections in writing where reasons for rejection must be stated. Have the SBA after three rejections have a quick appeals process where after a cursory review the SBA administrator thinks the borrower's application was unfairly rejected have select SBA banks take that borrowers application and consider it and double the fee for that select SBA bank for that loan make the fee ten percent of the loan!
The Democrats would like to increase the level of the funding in the SBA grant program, that is reasonable it is a responsible program giving $10 K grants to small business hurt be economy shutdown over Covid 19. Democrats how about calculating that number in a reasonable manner like the current program is funded at $10 billion now the original SBA program was funded at $350 billion and Republicans want to increase it by $250 billion so they are requesting to increase it by seventy-two percent so request to increase the grant program by the same percent which would be $7.2 billion. Democrats want to help healthcare providers hurt by the crisis. Prior legislation has given aid to this group; now instead of just pulling a number out of thin air why don't you push for a program where you run it through the SBA where you have a $100 billion loan program that is a loan forgiveness program set up the health care provider borrower gets loan forgiveness on its cash flow losses for the year that way there is no speculation we know exactly what the crisis cost the health care provider and the Federal Gov't is making them whole! As for the Democrats claim that SBA lenders are being unfair if not discriminatory to some small business borrowers and so they want to use Community Development Financial Institutions to do a significant lending. Democrats haven't made a persuasive case for this side program. All indications are that small business lenders are swamped and of course management has a duty to look out for the long-term interest of the business which is leading them to take care of past customers first. Of course with the numbers of borrowers seeking and getting these loans these banks are draining their capital at concerning rates. The good thing is that the Federal Reserve Bank has committed to take these SBA loans off their books so these banks can loan more surely the system needs to be given time to be working smoothly. SBA approved banks are trustworthy the American taxpayer doesn't want to see significant fraud with the use of a group of Banks that have not been vetted to handle this big responsibility. If the SBA program doesn't have protections against borrower abuse why don't Democrats have the legislation add them require SBA banks to put loan rejections in writing where reasons for rejection must be stated. Have the SBA after three rejections have a quick appeals process where after a cursory review the SBA administrator thinks the borrower's application was unfairly rejected have select SBA banks take that borrowers application and consider it and double the fee for that select SBA bank for that loan make the fee ten percent of the loan!
