As Election Day fast approaches, with less than two weeks remaining, President Trump and Congress find themselves in the unique position of agreeing that American workers and the business community are in need of another round of stimulus relief.
In a fluid process that seems to change by the hour, a concerted effort is underway to pass a relief bill prior to Nov. 3. House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin have held hour-long discussions this week and are finding more common ground, particularly in regards to bill language and the size of the bill, plus consideration for COVID-19 testing and tracing.
On Tuesday, President Trump told Fox News he would be willing to exceed the $2.2 trillion package sought by Democrats. That represented a major shift; Senate Majority Leader Mitch McConnell earlier said wouldn’t put the higher package on floor, because 52 of 53 Republican senators only want a $500 billion package. But on Tuesday, McConnell changed course and said if the White House and Speaker Pelosi agreed, and the bill passed the House, he would bring it to a vote.
Senate Republicans are keen to renew the paycheck protection program (PPP), which provided forgivable loans to small businesses that kept their workers employed. A bill that would provide $258 billion and enable small businesses—even ones that received a loan in the first round to apply for a second loan—failed to get the 60 necessary votes on Tuesday. A vote on another, scaled-down bill including the PPP, failed on Wednesday.
It seems certain that partisan posturing is likely to give way to relief for millions of Americans in the next week or so. But our State of the Industry look at legislative issues of importance to the office technology dealer community reveals that while programs like PPP are appreciated and necessary, they only serve as a bandage without treating the injury to the U.S. economy itself…and the need for complete and unfettered business resumption.
Immediate Action
Still, dealer executives are not discounting the importance of PPP relief. “The PPP did what it was supposed to do by helping a lot of businesses stay open and allowing their employees to meet their obligations such as paying rent, mortgages and other bills,” noted Gregg Petrie, president of Copiers Northwest in Seattle. “With uncertainty around COVID-19 remaining, I believe Congress needs to provide similar assistance in any future action.”
Chip Miceli, president and CEO of Pulse Technology in Schaumburg, Illinois, felt the first round of stimulus relief didn’t go far enough to help companies in need of assistance. Providing protection/relief to businesses will have a salutary effect on the workforce itself.
“Overall, the next relief package should help both employers and employees,” he said. “Any steps that can help businesses remain open will, in turn, help to keep people employed.”
Gary Johnson, president of WiZiX Technology Group in Fresno, California, notes that his company utilized the initial PPP funds. Fortunately for WiZiX, business has picked back up and the dealer is performing well.
“I haven’t given much thought as to what we need,” he said. “I would like to see (relief) focused on the smaller businesses and not focused on direct payment to employees.”
Americans need to get back to work en masse in order for the economy to get moving again and put an end to the carnage of business, notes Paul Archer, president of Denver-based Automated Business Products. With thousands of businesses failing during this period, Archer is concerned about the impact of adding so much debt will have on the country.
“We’ve already spent $7 trillion dollars on stimulus, money we don’t have, and the federal deficit has skyrocketed from $19 trillion to about $27 trillion,” he said. “Our federal deficit is now more than our annual GDP; it’s now about 40% of all the aggregate value of all the assets in the United States. That’s scary when it gets to that level.”
Paying the Piper
Vince Puente, president, sales and marketing for Southwest Office Systems of Fort Worth, Texas, is in agreement with Archer. He wants to see how the American government is going to pay for the stimulus package, because it “can’t just keep printing money.” The key, he feels, is creating jobs.
“You can do stimulus to keep the company in business, but that doesn’t create jobs,” he said. “If you don’t have jobs, businesses won’t grow. You can provide me with $100,000 to employ people, but as soon as that $100,000 is out, I’ve got to turn that, because now they become a negative to my bottom line and there’s no activity associated with it.
“Stimulus is just another form of welfare, and with welfare comes hooks. You’ve got to be careful what those hooks are. Most of us realize business succeeds better when it’s not hooked to the government. That creates a certain dependence. The more welfare and stimulus we get, we become dependent on that in order to survive, and that’s a dependency on the government. That’s not how the U.S. succeeds.”
