Is This How the Small Business Program Gets More Cash?

Is This How the Small Business Program Gets More Cash?

Aaron Bernstein

As the standoff over providing billions of additional dollars to a crucial small business aid program continued Friday, comments from House Minority Leader Kevin McCarthy pointed toward a possible deal that would provide lawmakers with a way around the impasse.

The standoff: With the $349 billion Paycheck Protection Program running out of funds earlier this week, Democrats and Republicans can’t agree on how to inject another $250 billion into the program, which provides loans and grants to small businesses struggling during the coronavirus crisis. Senate Republicans want to see a “clean,” single-purpose bill that provides the funds, while Democrats are pushing for a more complex package that provides additional funds for hospitals, food aid, and state and local governments.

Senate Majority Leader Mitch McConnell said Thursday that the two sides have made “absolutely no progress,” according to The Hill. But on Friday, Rep. McCarthy told The Wall Street Journal he was willing to include the additional money for hospitals in the small business funding package that Democrats are seeking, raising hopes for a compromise deal that could be taken up in the Senate as soon as Monday.

“Hospitals need the help. Hospitals are the modern-day soldiers,” McCarthy said. “I’d like to see money in there—money in the PPP and money in hospitals—that would be a very smart move right now.”

McCarthy also expressed interest in boosting the Economic Injury Disaster Loan program, a second small business aid fund that has run out of money. Democrats reportedly agree.

Not a good time for a stalemate: CNN’s Phil Mattingly and Lauren Fox said Friday that the PPP – which approved 1,661,397 loans worth $349 billion in less than two weeks – has run out of cash at a particularly inopportune time. “Tens of thousands of businesses did not get access to the program before it ran dry,” they wrote. “Those businesses, many of them teetering on the brink of failure, currently have no clear pathway to survival at the moment.”