Senator Scott Joins Leader McCarthy for Wall Street Journal Op-Ed: Democrats Want to Gum Up Payroll Protection
WASHINGTON – United States Senator Tim Scott (R-SC) joined House Republican Leader Kevin McCarthy (CA-23) in an op-ed published in The Wall Street Journal. The two members discussed the need for Congress to quickly replenish funds for the Paycheck Protection Program. The op-ed continued to explain that while Republicans stand ready to extend funding, Congressional Democrats continue to press for revisions that would make the program more costly, complicated and confusing for small businesses to receive their loans in a timely fashion.
Democrats Want to Gum Up Payroll Protection
The Wall Street Journal
Republican Leader Kevin McCarthy and Senator Tim Scott
April 15, 2020
Small-business layoffs increased tenfold in March as economic activity shut down to prevent the spread of Covid-19. As Congress continues to address this crisis, we must replenish funds for the Paycheck Protection Program, the largest small-business relief package in American history. According to the Small Business Administration, more than one million loans have been approved, with more than $247 billion processed. The $350 billion Congress allocated is expected to run out by Friday.
Everyone agrees the program needs more money. But instead of acting quickly to protect millions more jobs, Democrats are pressing for revisions that would make the program more costly, complicated and confusing for small businesses and their employees to receive loans in a timely fashion.
Program participation is now a straightforward, three-step process. First, fill out a two-page “Borrower Application Form,” which can be found on the SBA’s website. Second, make a copy of your payroll documentation. Third, submit the form and payroll documents to any lender backed by the Federal Deposit Insurance Corp. This simplicity makes the program accessible for mom-and-pop shops that don’t have a government-compliance department.
Democrats want to replace simplicity with more bureaucracy. They propose mandating that small-business owners submit personal data about themselves and other owners and investors to their banks and the federal government. According to Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer, this will ensure that no one is “excluded from the Paycheck Protection Program by big banks with significant lending capacity.”
Congress should do everything in its power to ensure the program is fair and available to everyone. But the Democrats’ proposal would have the opposite effect, for three reasons.
First, complicating the application process so soon after the program began would create uncertainty for borrowers and lenders, slowing requests and disbursement of aid.
Second, implementing these rule changes would divert vital agency resources—which are already stretched—away from providing relief.
Third, new regulations would likely raise, not reduce, costs on small businesses. The Democratic plan mirrors legislation they pushed last year. According to analysis by the nonpartisan National Federation of Independent Businesses, that legislation would have added more than $573 million in new costs and 13.2 million hours in new compliance burdens a year.
The American families that are relying on the Paycheck Protection Program need more funding, not more bureaucratic hurdles. When the stakes are this high, true leaders focus on the common good instead of fixating on political pet projects. It’s time for Democrats to stop proposing sweeping partisan plans that predate this crisis and work with Republicans to extend funding quickly for the program on which millions of businesses and their employees depend.
The full article can be accessed HERE.