Saving Main Street by Gary Rivlin

Author:Gary Rivlin
Language: eng
Format: epub
Publisher: HarperCollins
Published: 2022-08-27T00:00:00+00:00

Chapter 10

Family Reunion

The Paycheck Protection Program had been created to aid small businesses keep their lights on through the pandemic. It did that—as well as assisting a long list of outfits that hardly needed government help. A lawsuit filed by several media outlets, including the Washington Post, the New York Times, and ProPublica, forced the SBA to release the names of every applicant that received at least $150,000 in PPP funding (later the government posted a database that included every PPP recipient). That sparked more outrages beyond the publicly traded giants outed earlier, starting with businesses backed by private equity’s deep pools of money.

P.F. Chang’s, with more than two hundred outlets scattered around the US, received millions in PPP dollars. So, too, did TGI Fridays, a chain with nine-hundred-plus locations in sixty countries, and also Five Guys, with more than 1,500 locations, and Bojangles, with more than 750 outlets. All told, businesses backed by private-equity firms received at least $1.2 billion through the PPP and EIDL programs, according to a 2021 study by Americans for Financial Reform, the Anti-Corruption Data Collective, and Public Citizen.

The Riviera Country Club, which included Steven Mnuchin as a member, received millions. Lobbying firms were on the recipients list, as were the Church of Scientology and Kanye West’s multibillion-dollar apparel and sneaker company. The prestigious Aspen Institute took $8 million from PPP, despite a $115 million endowment. Tom Brady has a net worth in the hundreds of millions, but his nutrition company, TB12, Inc., scored $961,000 in PPP dollars. A mining company with more than 750 employees also received PPP dollars because, an SBA spokesperson explained, “under SBA’s small business size standards, mining operations allow for more than 500 employees.”

The antigovernment Ayn Rand Institute might passionately oppose bailouts, but that did not stop them from taking hundreds of thousands of dollars from PPP (as “partial restitution for government-inflicted losses,” the organization wrote in its application). The Americans for Tax Reform Foundation, the research arm of Grover Norquist’s antitax group by that same name, took money from the program. Normally, members of Congress were not permitted to receive money through the SBA, but the agency waived that ethics rule. At least seven members of Congress or their spouses received PPP loans, including Oklahoma Republican Kevin Hern, who owned so many McDonald’s franchises (eighteen at one point) scattered around his state that he had been dubbed “the McCongressman.” Hern had pushed for the “per physical location” exemption to PPP so that franchises were eligible and then accepted at least $1 million in PPP dollars.

The records show that Cusumano’s Restaurant, Inc., in Old Forge received a PPP loan of $44,800. The money had arrived at the end of April, almost immediately after the government replenished PPP funding. The requirement that he spend 75 percent of the money on payroll was irritating. “I was hating on PPP in the beginning,” he said, citing the strict terms that had been imposed. But it also let him survive until June 5, when Lackawanna County went yellow and Cusumano’s could offer outdoor dining on its back porch.

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