BBC “Business Matters: More government money for US small businesses.”
Following the recent 388 to 5 passing of the Congress bill to add an additional $484 billion to help small businesses, the BBC reviews the reasons for the necessity of this addition as well as how this money might affect small businesses. Dante Disparte, the Head of Policy at the Libra Association, announces that 36.4 million Americans have applied for unemployment claims, demonstrating the enormous turmoil for both American employees out of work and the small businesses who no longer have the resources to keep their staff on the books nor their doors open.
Dr. Ayman El Tarabishy, executive director of the International Council for Small Business and George Washington University professor, begins by describing these additional funds as “excellent news;” however, later, he admits that we need more. As the first wave of support did not reach many small businesses, this original inadequacy “lost” many SMEs for good. Those that decided that they had to close their doors will most likely not be looking for a recovery plan. The uncertainty of timing, logistics, and aid could have played a major role in their endings. Dr. El Tarabishy does point to a “middle-class,” so to speak, of small businesses that have yet to close their doors, yet who remain in a limbo. Their journey will certainly be characterized by their ability to access financial support, specifically that of this most recent stimulus addition.
When asked if there was a risk that the first round of funding, Dr. El Tarabishy stated that the money most certainly did not go to the right people. In the “frantic effort” of the first dispersion, the government did not consider how the “first come first serve” setup of administering aid was indirectly designed to assist companies, such as franchisees, that have access to banking systems. According to Dante Disparte, this prevents those who truly need it, especially those living or established in vulnerable communities to receive the government support that they need to survive. Disparte believes that this recent intervention is welcome, however the government must be “sharper” on its administration, meaning that we need not just a comprehensive package but also comprehensive plans to make sure that the small businesses targeted are receiving their rightful aid.
Following, Stefanie Yuen Thio of the Joint Management Partner at TSMP Law in Singapore, describes Singapore’s $64 billion Singapore dollar plan, which she believes to be more targeted than the US package. As the Singaporean government works to put “cash directly in the hands” of its constituents, the program seeks to help everyone. When questioned as to from where this money is coming, Stefanie points to Singapore’s enormous reserve pool. Therefore, the country is not printing as much money as they are utilizing past savings to support their nation in this crisis.
Taking a moment to speak about Europe’s financial situation and subsequent package, BBC’s Andrew Walker explains the European Union’s recovery fund angled to rebuild. Involving a lot of decision making, this push forward forces us to imagine what it might look like as well as how it will be financed. After an e-meeting amongst EU leaders, Italian Prime Minister Giuseppe Conte, described seeing a lot of progress, however, while still not receiving all of his wishes to assist Italy. Walker describes that this “collective financial rescue package” is designed to minimize long-term damage by “tidying European economies over the crisis.” Dante Disparte sees this deal as incomplete. He believes that the EU needs a “reminder of solidarity,” in order to globally map out a way for global solidarity to preval.
Stefanie Yuen reminds us to pay attention to China as they are using this moment to expand their power, exemplified by their aid to Italy. As the west attempts to pull away from their created ideals of globalism, we must be aware of the superpowers looking to step up in their place.
Reference News Clip: Business Matters- More government money for US small businesses