Opinion

Should you take a PPP loan

Posted 5/7/20

Several business owner friends have received a Paycheck Protection Program loan and are happy about it. They have been able to rehire some employees, open their doors, restock their stores and serve …

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Opinion

Should you take a PPP loan

Posted

Several business owner friends have received a Paycheck Protection Program loan and are happy about it. They have been able to rehire some employees, open their doors, restock their stores and serve  their customers. Many hope to do this right and may not have to repay the loans.
A few words of caution.
Business owners who can afford not to should seriously consider bypassing federal loans as they may be deals with the devil, advises Paul Atkins, a former commissioner of the Securities and Exchange Commission. 
The cost may dramatically outweigh the temporary gain.
Remember you are borrowing from the taxpayers – yourself included – who front the money but it will be federal bureaucrats who will check up on you.
Give a bureaucrat a little authority to investigate what you did with the money and he is liable to find some fine print that shows that (a) you did not comply with all the requirements and (b) you are liable for criminal charges, hefty fines and other financial nightmares.
 Another concern is that if your loan is forgiven under today’s guidelines you may face future bureaucratic demands for environmental or other regulations, Atkins warns. Helping you avert bankruptcy today may be a way for politicians to impose obligations on you later.
And beating up on you may be a strategically political move for anti-business politicians on the socialist democratic left.
The Small Business Administration and the Treasury can head off some of this turmoil.
For example, big banks loaned millions of dollars to Harvard University, Shake Shack and other big corporations, looting the fund before small businesses could apply. Now they are being shamed into giving it back
In writing the rules officials can stipulate that anyone with ample resources isn’t eligible nor can have a loan forgiven.
We are sending these reservations to our Congressional delegation. Why not join us in this?
Please email me on how you think we can work together to JerryBellune@yahoo.com 

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