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OPINION

Congressional Democrats Playing with Fire – Imperiling America’s Small Businesses

The opinions expressed by columnists are their own and do not necessarily represent the views of Townhall.com.
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AP Photo/Susan Walsh

Benjamin Franklin famously said, “lost time is never found again.”  Congressional Democrats should harken to Ben Franklin, if only for a moment.  Blocking life-saving aid to small businesses last week, they imperil America’s recovery. Here is why. 

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Small businesses are the 30-million-cylinder engine that drives our economy.  Have no doubt: Without them, more than half of all jobs would vanish.  Neither big government nor big business can compensate for loss of small business innovation, job creation, or nimble operation.  That is why saving them is critical. 

On March 27, President Trump signed the CARES law, permitting the Small Business Administration (SBA) to release $349 billion to small businesses – first as loans, forgiven after eight weeks if employees are not laid off.  That bill seeks to compensation for government-mandates shutdowns, coast to coast.  It permits payment of salaries, rent, mortgages, and contract obligations.  

Notably, if these small business obligations were unmet, lack of liquidity and contract payments would quickly snowball into collapse of employee incomes, consumer spending, confidence, employment, health care and predictable future solvency.  Collapsing at the same time would be real estate, as landlords sought to keep lights, heat and security on – albeit with no payments, and banks spotted commercial and home mortgage payments – without solvent mortgage holders.  

On April 3, SBA began approving applications around the clock from small businesses for these life-and-death loans, which arrived via community and large banks. While the forgivable loans cover 2.5 times payroll, money was instantly tight.  Projections of what is needed to preserve the 30.2 million small businesses, leapt up.  

Accordingly, trying to get ahead of the tsunami in loan and unemployment applications, Senate Republicans put to a unanimous consent vote a second bill adding $250 billion to the SBA Payment Protection Program (PPP) – or direct loan program.  They sought passage on April 9. 

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Shockingly, Congressional Democrats stopped the bill.  Led by Speaker Nancy Pelosi (D-CA), Congressmen Steny Hoyer (D-MD) and James Clyburn (D-SC), together with Senate Majority Leader Chuck Schumer (D-NY), and Senators Dick Durbin (D-IL), and Patty Murray (D-WA), they blocked passage, preventing critical payroll resources from reaching small businesses.  

The next wave of this crisis is breaking across small businesses now, as of April 13.  At present, a majority of America’s small businesses – those under 500 employees, of which 89 percent are under 20 employees – are on a steep grade, quickly starting to drift backwards. They have no cash to burn, nowhere to turn – except to SBA, which is trying to save them.

SBA’s loans are vital for all Americans, young and old, urban and rural, every demographic, race, creed and identifier.  By example, 40 percent of American seniors over 55 are employed, roughly half in small businesses.  Retirement, direct checks and unemployment insurance are important, but so are these jobs.  

In explicably, Congressional Democrats have taken this crisis as an opportunity to cash in, get more unrelated goodies, compel inclusion in the pending legislation of things most Americans do not want or need, and most certainly cannot afford. Time is precious. 

By blocking unanimous consent April 9 on the $250 billion small business rescue bill, Democrats place millions of businesses and jobs at risk in their home states.  The error is profound, if not swiftly reversed is likely to inflict a significant wound on the country. 

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In an act of extraordinary irresponsibility, Speaker Pelosi stated on April 9: “We have made our statement.” In effect, America gets no more crisis-response money if Republicans do not accede to Democrat add-ons, including unnecessary spending, regulations and further centralization. 

The effect of this act, foisted on small businesses nationwide, is bound to be profound.  It represents a misunderstanding of what is required to run a small business and keep people employed. Most small businesses have limited liquidity, minimal margin for error, let alone cash to manage a prolonged shutdown – no fault of their own.  

The audacity and arrogance of forcing small businesses – and Americans they employ – to suffer rising risk of collapse is unthinkable.  It will also hit the states represented by these Democrats. Look at numbers. 

If this error is not swiftly corrected, small businesses in states and districts represented by these Democrats feel it.  As of April 11, 725,000 loans were processed by SBA, drawing $182 billion from the original $349 billion.  Most project this money to run out this week.  

Congressional Democrats simply do not understand.  In Pelosi’s California, four million small businesses employ seven million people.  They are 99.8 percent of all California businesses, employing 48.8 percent of the workforce.  

In Schumer’s New York, at least 1.8 million small businesses provide half a million jobs – before including New York’s big pool of self-employed.  In Hoyer’s Maryland, half a million small businesses employ hundreds of thousands.  Durbin’s Illinois has more than a million at-risk small businesses, while Washington’s Patty Murry has more than half a million, and Clyburn’s South Carolina has just under half a million – all before the self-employed.  Democrats are driving many small businesses over the cliff, for misconceived partisan gain. 

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Nationally, tallies show America has 30.2 million small businesses, which provide roughly half of all of America’s employment.  The central question is this – should we not be saving the engine that drives the US economy?  No one wants waste, but this crisis is not of America’s making, and no fault of our small businesses. 

In short, funding for SBA’s PPP program – now – is vital.  Barriers for restarting collapsed businesses are high, and Americans are suffering unprecedented uncertainty. Congress has it within its power to put politics aside, saving those who have taken great risks to produce and employ the nation.  Small businesses are the categorical opposite of well-coifed, well-fed, poorly led members of Congress who block their survival – after the economy was shut down. 

Democratic congressional leaders – and their caucus – are costing America dearly.  Days will make the difference between survival and failure, jobs retained or lost, paychecks arriving or not.  While Democrats angle for ways to load bills with unnecessary spending, Americans wait. 

Whatever happens this week, Democrats are playing with fire.  American businesses with fewer than 100 employees account for 98.2 percent of the total, and they must pull through.  Tens of millions of jobs lie in the balance – along some congressional jobs in DC.  

This can be corrected with a fast vote to properly fund SBA’s PPP program this week.  Putting small businesses – and countless American families – at risk for misconceived partisan advantage is just plain wrong.  November is coming, but we need leadership now.  As Benjamin Franklin soberly noted, “lost time is never found again.”  Congressional Democrats must act.

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Robert Charles is National Spokesman for the Association of Mature American Citizens (AMAC) a 2.1 million-strong, non-partisan group for Americans 50+, a former assistant secretary of state for President George W. Bush, a former naval intelligence officer and a litigator. He served in the Reagan and Bush 41 White Houses. 

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