An article from CNBC discusses several public companies that took small business rescue loans say they are not giving back the cash” discusses how not only did the Federal Government mistakenly give public companies and corporations the rescue funds that were specifically meant to go to small business owners, but many of these companies are now officially taking the stance that they will not give these funds back- all while the rescue fund for small businesses have been wiped out entirely and there is no more money to give at the time being.
CNBC reached out to the 41 biggest publicly traded companies that had received Paycheck Protection Program loans to see if they would be returning the funds. Six said they had no plans to return the funds, five said they will (or had) returned the money, while 30 either did not respond or said their decision was pending. One CEO keeping the cash said, “to return would be breaching fiduciary duty.” The government warned public companies on Thursday to return the relief loans in two weeks if they wanted to avoid scrutiny about whether it was necessary for them to take the capital.
I bring this instance up for a few reasons, first being why hasn’t Uncle Sam simply withdrawn those funds that were wrongfully given to public companies, and reallocate the funds to those small businesses that are still waiting and unable to receive any additional help? It seems that this mistake on behalf of our own government could easily be fixed, yet they are allowing the true mom-and-pop shops to suffer while corporate America continues to get more and more benefits (i.e. tax breaks, increasing salaries for executives, etc.). Simply warning companies that they will only ‘face scrutiny’ if they do not return the funds is a very weak threat. When congress wants something, they find a way to pay for it- don’t feed the public that there is no more available rescue funds for small businesses while the news is celebrating the frontline workers during the pandemic such as grocery stores, delivery/trucking, healthcare, many of whom work for small businesses and corporations alike- don’t make it a choice about who is in more need of help when the economy is halting.