As the current round of PPP is due to end on March 31st, some groups are advocating for the program to be extended. My position might not be popular, but we need to wrap up the program and keep our economy moving forward.
Don’t get me wrong – PPP had an important role in keeping the economy going over the past year. Yes, it was not perfect – it had, and continues to have difficulties. But it worked – and helped save millions of companies and tens of millions of jobs.
But now the challenges in front of us are different.
There are businesses that continue to struggle as a result of Covid-19. They can be helped with the Economic Injury Disaster Loan program that is administrated by the SBA and is designed to deal with crises.
This effort is important, but not enough to deal with lagging unemployment.
We must create incentives for entrepreneurs to start and or grow companies. We must be sure there are incentives to grow payrolls, and make sure that businesses have access to capital to grow, hire and expand.
This can be accomplished with tax policy, and focusing on traditional SBA lending. We can use the mechanism of SBA lending and increase maximum loan sizes, extend the 90% guarantees and fee waivers beyond September 30th. And we can reallocate the PPP budget so that new borrowers can get more than three months of payment relief.
Just helping struggling businesses is not enough. We must focus resources on risk-takers who are willing to step up to the plate, build companies, and move our economy forward. The entrepreneurial spirit is critical for economic recovery. I hope that our elected officials will do their share to help light the flame.