By “vague notion” do you mean “thing that no one is saying or thinking”?
Why do you think that no one understands how taxation works?
You can find the answers to all of your questions here: https://sba.box.com/s/tvb0v5i57oa8gc6b5dcm9cyw7y2ms6pp (note: link to zip file that can downloaded). There is one file that has all of the loans over $150k and then a separate file for each state that has the smaller loans.
Here are the first 10 business in the “large loans” file, if you’d like to peruse them (the are all from Alaska since it’s sorted alphabetically):
- ARCTIC SLOPE NATIVE ASSOCIATION, LTD.
- CRUZ CONSTRUCTION INC
- I. C. E. SERVICES, INC
- KATMAI HEALTH SERVICES LLC (this one has a “zero” for jobs retained, so possibly a data error or they cancelled)
- MATANUSKA TELEPHONE ASSOCIATION
- NANA WORLEY, LLC
- NORTHERN ENERGY SERVICES, LLC
- SOUTH PENINSULA HOSPITAL INC
- TATITLEK TECHNOLOGIES, INC.
- TYONEK GLOBAL SERVICES, LLC
The sum of the “jobs retained” column for just the big loans is over 3 million, by the way.
For more oversight, you should be looking for data or reports from the PRAC, I believe. That was the oversight board that Congress created for distributed pandemic relief. You can find their work here: https://pandemic.oversight.gov/
ETA: I should add that it appears only the large loans file has the actual business names.
To be fair, there is plenty of evidence that most people don’t understand how taxation works for basically any definition of “how taxation works”. They don’t understand marginal rates. They don’t understand the difference between debt and deficits. And on and on.
None of which is applicable to “tax money is spent on things the government does”, which is the part that everyone understands about how taxation works.
That’s not remotely correct.
“Jobs retained” does not mean that anyone has figured out that these jobs would have been lost without the government subsidies and were retained as a result of the subsidies. All it means is that the employers took government “loans” to cover the salaries for these jobs, which are forgiven if they maintain the jobs for some period of time (I think a few months).
It’s likely - and certainly is the case in the situations I’m familiar with - that most or all of these jobs would have been maintained even if the subsidies had not been created, and the subsidies are simply a taxpayer-sponsored windfall to wealthy business owners.
Well, of course. I don’t think there was any confusion about the fact that companies could take the money to make payroll and then the loans would be forgiven as long as they kept paying salaries. And obviously there will be companies that get the money that didn’t truly need it - that’s sort of how stimulus works (it’s not like everybody that got the direct payments needed it either).
I’m just saying that it’s not true that there is no record of who got the money, or that there is no oversight being done. I dug a bit deeper within the MO file and down into my zip code. I found a few companies that I didn’t know anything about, but all of the local restaurants and shops that I expected to be there were. I would encourage you to do the same if you’d like - it may make you feel a bit better about who got the money, or it might make it worse. Either way I’d be curious to hear your assessment.
In that case, I don’t know what you were responding to or adding. I did not say that “that there is no record of who got the money, or that there is no oversight being done”.
To the contrary, I said in the OP that “There are sources online where you can check how much various local businesses have made in stimulus funds, so I can see who is getting what. And I can see numerous local businesses who have been paid 6 or 7 figure sums, and who I know for a fact have been doing a brisk business throughout the shutdowns.”
I should have quoted more selectively. I was responding to the “vast majority for all I know” part. But I agree with your observation that broad stimulus almost always provides more funds than are strictly required in an attempt to save the delays necessitated by forcing recipients to prove their eligibility.
Well here’s a study which purports to measure the number of jobs retained due to the PPP. Their estimate is between 1.36M and 3.20M, with a “preferred” estimate of 2.31M. This is at a cost of $518,000M, or a cost per job of $162K and $381K, with a “preferred” estimate of $224K.
The important thing to remember is that these expenditures covered only about 2.5 months, to the end of May - the PPP is intended to cover 10 weeks of payroll. The amount per worker that it covers is wages of up to $100K annually, plus benefits, taxes etc. Let’s assume that this works out to $150K annually in total or $31K for the 10 weeks. But that’s the maximum. I would think the average would have to be considerably lower than that, and that even $20K per covered worker is a very very generous estimate.
The implication of the above would be that over 90% of the funds went to support jobs which would not have been lost anyway in the absence of this program, at a conservative estimate. This is very much in line with my observations noted above. So it’s not like it was imperfectly targeted. This was a huge huge giveaway and wealth transfer from middle class to wealthy.
It’s also worth noting that this particular study is not a low-ball estimate of the impact of the PPP. To the contrary, the study itself cites several other studies which found the impact of the program to be much smaller than this study did, and the point of this study was to show that it did have more impact in saving jobs than those other studies concluded.
Apparently no one’s interests revolved around the patients which doesn’t make me overly sympathetic to either side but more likely to side with the owners since they’re at least keeping therapy available. I’d say the PPP is working as intended here (assuming they got a PPP loan) in that it’s keeping the employees on payroll and productive rather than collecting unemployment.
I think this is probably correct. For me PPP was more like a supply-side tax cut - put funds into business owners pockets so their businesses don’t close, or so they can continue to function for some time even after PPP funds “run out”. It’s pretty wasteful compared to demand-side stimulus like the unemployment boost (which had it’s own negative consequences) or the direct stimulus payments, but I can see why it was politically popular.
PPP also had the problem (noted in the paper) that if your business was totally wiped out you didn’t get the money (because you couldn’t afford to keep staff on even with the loans), but if you were relatively unaffected it was actually easier to get the money. Obviously businesses found themselves all along this spectrum.
There is also the political question about the difference in popularity between “loans to small businesses” and “direct payments” or “larger unemployment benefits”.
I’d say the PPP is working as intended here (assuming they got a PPP loan) in that it’s keeping the employees on payroll and productive rather than collecting unemployment.
That instance came up in the context of whether people were better off if they were impacted by covid, and not in the context of the efficacy of the PPP program. But FWIW, the PPP was not “working as intended” in this instance, because the business’ revenues were unaffected by covid, and they would have stayed open in any event. So the owners just got a windfall, and collected the full revenues that the firm earned plus the government funds.
For me PPP was more like a supply-side tax cut - put funds into business owners pockets so their businesses don’t close, or so they can continue to function for some time even after PPP funds “run out”.
From my perspective, there’s a huge difference between letting people keep money they’ve earned and just giving them government money (which will be taken from other people). In addition, there’s a question of scale as well.
Philosophically, perhaps. But practically, when talking about stimulus, I think both corporate tax cuts and PPP “loans” (quotes since most if not all of them will be forgiven) rely on the notion that providing money to business owners will stimulate the economy because the money will flow from them to the workers, suppliers, etc. And both suffer from the non-specificity problem where money flows regardless of need.
It contrasts pretty well with unemployment boosts, where other than outright fraud (which is certainly happening, but can in theory be caught), the folks getting the money actually need it, and are very likely to spend it. But of course that has the problem of some people not wanting to return to their job if the benefit is too large. And it’s a very attractive fraud target.
I don’t think there is a really good answer. If you truly feel you need to pump hundreds of millions or trillions of dollars into the economy a good chunk of it is going to go where it isn’t needed, especially if you want the injection to be quick. I think I would have focused on more direct payments to individuals and things like rent forbearance and mortgage payment holidays (perhaps with the government picking up the interest due the mortgage holders). Maybe a big increase in food assistance, especially once schools started shutting down.
I have no idea if they would have stayed open but I’m very skeptical that their business revenue would have been unaffected. ABA therapy is expensive and intensive and I very much doubt that everyone said “Oh, we’ll change from in-person hands-on therapy to Zoom meetings,? Sure I’ll totally keep paying full price for that.”
I have no idea if they would have stayed open but I’m very skeptical that their business revenue would have been unaffected. ABA therapy is expensive and intensive and I very much doubt that everyone said “Oh, we’ll change from in-person hands-on therapy to Zoom meetings,? Sure I’ll totally keep paying full price for that.”
They don’t bill individual people. They have a contract with the school board. As long as they can deliver their services, they get to bill for it, and the parents have no say about it.
It was harder for the therapists themselves, because trying to maintain the attention of these kids over zoom is much harder than when they’re in the room. But that didn’t impact the agency themselves - they made out like bandits.
Philosophically, perhaps. But practically, when talking about stimulus, I think both corporate tax cuts and PPP “loans” (quotes since most if not all of them will be forgiven) rely on the notion that providing money to business owners will stimulate the economy because the money will flow from them to the workers, suppliers, etc. And both suffer from the non-specificity problem where money flows regardless of need.
Perhaps I’m a philosopher. 
But even from a practical standpoint, the idea of supply side tax cuts has never been “let’s just throw money into the economy”. It’s been “let’s make the marginal value of more business greater so that people will work harder, invest more, take more risk etc.”
There are several things going on here.
The whole point of the stimulus was to get money injected back into the economy to be spent, to replace part of the money that was being lost by the lock downs and adverse impact of the virus on business operations. It was never supposed the be a means tested need. It had to be sent out fairly fast, for a government action, that is. So the vetting of the need for the money was secondary. And a lot of companies and organizations probably took advantage of that, maybe some of it can be recovered.
It was important to get the money in the hands of those people who were adversely impacted, to meet their needs, but it was also, equally important to provide money to those who don’t really need it so they can SPEND it and stimulate the economy. If you needed it then basic needs might be met, if you didn’t need it maybe you would just spend it on something.
Neither me nor my wife missed even a days work, but we put the money back into the economy. I bought a toy, the new Ruger 57 handgun. My wife did her part by breaking her foot.
The whole point of an economic stimulus is to, you know, stimulate the economy or in this case just replace some of the money that was not being spent. Targeting the money toward admirable goals is just politics, not economics.
Have we discussed this particular way that the CARES Act helped the wealthy at the expense of the poor?
Can’t find a suitable thread, so:
If I understand correctly, Trump’s executive orders commanding a payroll tax cut for most Americans are quite useless, because most employers will just hoard the cash rather than disbursing it to their employees, right? (in case the EOs are reversed and the employers are ordered to pay back the money to Uncle Sam)