Page 12 - BusinessWest April 27, 2020

Editorial
BusinessWest
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George O’Brien [email protected]
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Stimulus Money Goes to Wrong Places
“Free money.”
That’s the phrase one of the region’s bank presidents
used in a recent interview with BusinessWest to describe funds contained within the Paycheck Protection Program (PPP) being administered by the U.S. Small Business Administration.
He’s not entirely accurate with that choice of words — these loans are forgivable only if the companies receiving them keep everyone on the payroll for the prescribed period. But ‘free money’ is essentially what this is, if those requirements are met.
And the lure of free money is obviously quite strong, because interest in this program is off the charts. And as news starts to leak out about some of the large, national companies that are receiving this free money, it’s clear to us, and most everyone else, that some of it — and, unfortunately, a large portion of it — is not going to the desperate small businesses that need it most.
Hedge funds, national restaurant chains like Ruth’s Chris Steak House and J. Alexander’s, and a host of other large, public compa- nies have all received several million dollars from the $369 billion fund, which was totally depleted less than two weeks after the pro- gram was officially launched. Meanwhile, Harvard University, with its $40 billion endowment, received nearly $9 million in aid from the federal government through the CARES Act — specifically, a $14 billion fund to support higher-education institutions during the pandemic. More ‘free money.’
Actually, Harvard received less than some other either Ivy League schools — Columbia and Cornell each got almost $13 million.
Whatever those numbers are, they represent poor allocation of money that is desperately needed to keep smaller businesses afloat during these ultra-challenging times. Harvard could certainly use $9 million, but it doesn’t need $9 million — not nearly as much as hundreds of struggling small colleges across the country do.
Ruth’s Chris Steak House could certainly use the $20 million it
Opinion
received, but it doesn’t need it to survive like the myriad small res- taurants pushed to the brink of collapse need it.
Before we go any further, we’ll acknowledge that big companies have just as much right to apply for, and receive, stimulus money as the small ones do. They’re not breaking any laws by doing so. And we understand that a job saved is a job saved, whether that job was provided by a national taco chain or the corner pizza joint.
But the reality is, with a great many small businesses across this country, when it comes to the pandemic, we’re not talking about a bad quarter or a bad year — we’re talking about survival.
And while it wasn’t written into the legislation that created the Paycheck Protection Program and other forms of relief, enabling threatened companies to survive was, or should have been, the intent.
Moving forward, it should be. Many more relief measures will be passed in the months to come, and with these, Congress should be more diligent about who is eligible and who is actually awarded funds.
Meanwhile, we encourage those larger businesses to follow the lead of Shake Shack, the giant chain that was awarded PPP money and then gave it back amid the outcry from smaller businesses left high and dry.
“As we watched this opportunity play out over the weeks, it was very clear that the program was underfunded and wasn’t set up for everyone to win,” Shake Shack CEO and Chairman Danny Meyer said of his decision. “By returning our $10 million, that $10 million can go back into the pot and go to the people that deserve it.”
He’s right about that, and by ‘deserve,’ he means the hardwork- ing small-business owners who simply don’t have the resources to weather this storm.
These are the people who deserve this ‘free money,’ and we’re hoping that, from this point forward, more of them wind up getting it. v
For Springfield, a Loss of Momentum
IBy George O’Brien
f one were to take a walk down Main
Street — and I just did — it would be
tempting to say that, if Springfield had any luck at all, it would be bad.
Yes, the pan- demic is hitting every coun-
try, every state, every city and town, hard. As in very hard. But in Springfield,
it seems worse, because things were—andI
hope I don’t have to keep using the past tense — so much better. And the outlook was certainly bright and quite intriguing.
Now?
Now, we’re left to hope that, when this state gradually turns the economy back on again, the city can maybe pick up where it left off. That might be the best we can hope for at this point, but let’s stay optimistic.
After a quick walk around, it’s hard not to lament all that’s been lost, even though
it’s clear that a shutdown was absolutely necessary to flatten the curve and put the region’s healthcare system in a position to do battle with this pandemic.
And it’s momentum that we’ve lost most of all.
Let’s start at MGM Springfield. It’s eerily quiet there, almost as if things are frozen in time. The doors that were never supposed to be locked are now locked. And who can say when they will open again? Likewise, who can say what business will be like when the doors do open again?
Casino floors are — in the best of times — crowded places with people sitting around blackjack tables, positioned just a few feet from each other at the rows of slot machines, jammed into the food court, and generally milling about, taking it all in. On a busy Friday or Saturday night, it’s difficult to find elbow room. When are people going to want to be in such a place again — espe- cially the older population that makes up such a large part of this casino’s clientele? Indeed, the casino’s best customers are those most at risk.
But that’s just the casino floor. Perhaps the bigger contribution the casino has made has been to vibrancy in the down- town, the nightlife, through events in its ballrooms and shows at the MassMutual Center, Symphony Hall, and other venues. Who can say when there will be another concert, another convention, or even a fundraising dinner for a local nonprofit agency?
People are optimistically eyeing late summer or perhaps the fall as a time when we can return to something approach-
ing ‘normal.’ But how realistic are those projections?
Walk around Springfield, and most of the signs of progress, the indicators that this was a city on the rise, are now as silent as the casino.
There’s the Amazing World of Dr. Seuss Museum, which was bringing families from every corner of the country to Spring-
Opinion
Continued on page 37
12 APRIL 27, 2020
COVID-19 SPECIAL COVERAGE
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