Earlier this week the Daily Mail reported that the rich and famous including Kanye West, Tom Brady, Jared Kushner and House Speaker Nancy Pelosi’s husband had their Payment Protection Program loans forgiven. Other high-profile recipients including Khloe Kardashian, Jeff Koons and Reese Witherspoon also had their loans forgiven. The newspaper drew on ProPublica’s extensive database, which tracks every loan.
Celebrity or not, pretty much everyone has had their loans forgiven. Of the $793 billion approved for 11.5 million loans, $742 billion was forgiven, according to ProPublica data. The PPP program offered forgiveness to small-business owners based on how many employees were kept on the payroll and what hours and wages they received. That said, the PPP program — though scattershot and rife with fraud — at least contributed to its main objective, which was to keep Americans employed through the COVID-19 pandemic.
A simple chart shows that when President Donald Trump first signed the law into existence, unemployment was at 14.7%. When President Joe Biden signed the extension, the jobless rate was still 6%. In July, it was 3.5%. Granted, it was not the only pandemic relief program, and the emergence of vaccines helped provide confidence to businesses and consumers alike to resume normal activities. An extensive study found PPP ended up sending loans to 93% of small businesses in just two months. That study found it preserved what it called 3 million “job years” of employment. Read: Up to three-quarters of the $800 billion in disbursed PPP funds flowed to business owners instead of workers, study finds But the study, by Massachusetts Institute of Technology economics professor David Autor, as well as several Federal Reserve economists, also found it was expensive, at a cost of between $170,000 to $257,000 per job retained. As little as 23% went to workers who would’ve lost their jobs otherwise, the authors concluded. The gains — as the Daily Mail article implies — were predominately tilted toward the wealthy, unlike other pandemic relief programs such as expanding unemployment benefits and cutting stimulus checks whose benefits were more wide spread.