Mary: I’m Mary Walden with economist MW, welcoming you to the economic perspective. Today’s program looks at PPP progress and problems. Mike, the Payroll Protection Plan has been the federal government’s premier program to help save businesses and their workers during the coronavirus. We’re now beginning to get some information on how the plan worked. What’s the current conclusion?
Mike: Summary Answer
- Massive program that pumped in three-quarters of a trillion dollars to businesses and workers within a couple of months
- Wanted to do fast
- To do fast, used banks – who have thousands of outlets – to administer the loans
- This did create two issues: those businesses without banking relationships could be left out, and banks were motivated to make loans to larger businesses because loan process didn’t vary much by size of business
- Congress did come back and tried to correct the nonbank issues by setting aside funds specifically for those groups
- Program did prevent some – but not all – bankruptcies, and did get money in hands of workers
- If willing to take longer, could have avoided some issues, but speed was viewed as crucial
- I’m MW
Mary: And I’m Mary Walden for the Economic Perspective, an NC State Extension program from the Department of Agricultural and Resource Economics.