COVID-19 "95/5 Rule" Post #1

The federal and state COVID-19 response to assist small business is already fraught with major impediments. Government must approach the financial crisis with the 95/5 rule.  Assume that 95% will follow the rules and are not going to abuse the system. That means none of the traditional SBA, Commerce Department nonsense requiring extensive documentation, forms and requirements.

The money needs to go into the hands of these businesses. Now. A recovery that takes a year is no recovery.

Yes there will be fraud and theft. Save the handcuffs for the giant corporations:    

 

•         No executive bonuses for a decade
•         No stock buy backs
•         No corporate political contributions*

But for small businesses get the money into Ma and Pa's hands now. The fraud in assisting small businesses will pale in comparison to what the greedy did in the Savings and Loan Bailout and the Great Recession.

 

*Citizens United may allow corporate contributions but there is no problem denying federal money as a condition of a loan or grant.

 

Editor's note:  When I left office a year ago I decided not to comment on any public matter. COVID-19 is too important and so here is the start of a series of posts on the subject.

Comments

[Joel Neuberg]

Thank you, Mr. Mayor.