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A new Public Citizen analysis of the Fed's Main Street Lending Program (MSLP) has found that the program facilitated over $1.8 billion in loans to companies that laid off workers during the pandemic, and extended support to wealthy companies that were first in line to receive multi-million-dollar PPP loans. The findings of the report indicate that MSLP failed to meet its goal of supporting employment, as well as its goal of providing aid to businesses that were financially sound before the pandemic but have been damaged by the economic downturn caused by COVID-19.
A new Public Citizen analysis of the Fed's Main Street Lending Program (MSLP) has found that the program facilitated over $1.8 billion in loans to companies that laid off workers during the pandemic, and extended support to wealthy companies that were first in line to receive multi-million-dollar PPP loans. The findings of the report indicate that MSLP failed to meet its goal of supporting employment, as well as its goal of providing aid to businesses that were financially sound before the pandemic but have been damaged by the economic downturn caused by COVID-19. These discoveries have major implications for future emergency lending programs, indicating that structural changes will be necessary to make another iteration of MSLP successful.
Miriam Li, a corporate accountability associate in Public Citizen's Congress Watch division, explained that program funds were both underused and misdirected - outcomes that should guide lawmakers in crafting future lending programs for struggling businesses. "MSLP had the potential to provide significant support to struggling businesses and their workers. The idea was great, but the program ultimately failed to reach the neediest companies, failed to adequately support workers, and ended up providing loans to companies that already had access to other sources of credit."
Other key findings include:
The report also finds that the Fed's changes in MSLP rules mirrored requests by fossil-fuel-industry lobbyists, which included removing borrower certifications regarding financial need and employee retention efforts. The report suggests that these changes exacerbated the MSLP's failures and opened the program to companies that should not have received taxpayers' support.
The report's policy recommendations section calls for future emergency lending programs to take on greater risk by loosening credit requirements and extending loans to companies who have been severely damaged by the pandemic. It also calls on lawmakers to implement stronger guardrails for future stimulus programs, including borrower certifications regarding financial need and employee support.
Li noted that, now that MSLP has ended, creating a new government lending program will be critical to mitigating the economic damage wrought by COVID-19. "Mid-sized businesses employ 44 million people in the United States. Mass closures of small and mid-sized firms will not only take away these jobs, but it will also accelerate the rate at which multi-national corporations take over Main Street - a trend that hurts local communities, business owners, and American consumers."
Read the report here.
Public Citizen is a nonprofit consumer advocacy organization that champions the public interest in the halls of power. We defend democracy, resist corporate power and work to ensure that government works for the people - not for big corporations. Founded in 1971, we now have 500,000 members and supporters throughout the country.(202) 588-1000
"Similar to the countless battles the LGBTQ+ community has faced over the last several decades, our collective success relies upon everyone speaking out and taking a stand against bigotry," said the group who challenged the statute.
A federal judge on Friday evening ruled that Tennessee's anti-drag show law—the first of its kind in the nation signed by Republican Gov. Bill Lee earlier this year after approval by the GOP-controlled state legislature—represented an unconstitutional attack on free speech.
The 70-page ruling issued by U.S. District Judge Thomas L. Parker found that the law was "unconstitutionally vague and substantially overbroad," making it a clear violation of the free protections in the First Amendment.
"We Won!" declared Friends of George's, the non-profit performance group in the state who had challenged the law.
\u201cWE WON! Judge Parker has declared Tennessee's anti-drag law unconstitutional! Friends of George's would like to thank Brice Timmons and Melissa Stewart at Donati Law and all who have stood by us during this fight! #standwithfriendsofgeorges #pride #dragisnotacrime\u201d— Friends of George's (@Friends of George's) 1685795100
While the word "drag" or phrase "drag show" did not appear in the statute, Judge Parker said the examples offered by the defenders of the law during the hearing of the case exhibited clearly who and what the law was targeting and that it therefore encouraged "discriminatory enforcement" by the state.
"There is no question that obscenity is not protected by the First Amendment," states the ruling. "But there is a difference between material that is 'obscene' in the vernacular, and material that is 'obscene' under the law."
"Simply put," it continues, "no majority of the Supreme Court has held that sexually explicit—but not obscene—speech receives less protection than political, artistic, or scientific speech."
\u201cLast night, Tennessee\u2019s extreme drag show ban was struck down and ruled unconstitutional by a Trump-appointed federal judge. \n\nTried to tell my Republican colleagues when they introduced it on the House floor, but yet again they had to FIND OUT. \n\nHappy Pride, y\u2019all!! \ud83c\udff3\ufe0f\u200d\ud83c\udf08\u201d— Rep. Justin Jones (@Rep. Justin Jones) 1685805066
In a statement on Saturday, Friends of George's said the ruling "represents a triumph over hate."
"Similar to the countless battles the LGBTQ+ community has faced over the last several decades, our collective success relies upon everyone speaking out and taking a stand against bigotry," said the group, based in Memphis.
Jonathan Friedman, director of free expression & education programs for PEN America, also celebrated the ruling, calling it a "necessary victory for free speech" in Tennessee.
The freshman Democratic congressman offered a concise political rebuke of his fellow Floridian during a rock concert Friday night.
Freshman Democratic Congressman Maxwell Frost of Florida was given an opportunity to speak to the crowd attending the Paramore concert in Washington, D.C. on Friday night and he offered just one word to Republican presidential candidate Ron DeSantis and the fascist policies he has pushed as the governor of the Sunshine State.
"Fuck Ron DeSantis! Fuck fascism!" said Frost when handed the microphone by lead vocalist Halyey Williams during the show at the Capitol One Center.
\u201cHoly shit. Maxwell Frost appeared at a Paramore concert last night & his first words on stage were \u201cfuck Ron DeSantis.\u201d The crowd went absolutely wild. Gen Z will make Ron DeSantis\u2019s life miserable & will never allow him to be president. Watch \ud83d\udc47 \nhttps://t.co/S7Drc0dgRq\u201d— Victor Shi (@Victor Shi) 1685806387
Frost, currently the youngest member of Congress at 26-years-old, has been an outspoken critic of DeSantis for his attacks on public education, a relentless targeting of the LGBTQI+ community, book banning, and his regressive economic policies.
"I said what I said," Maxwell tweeted later in the night. The congressman also responded to right-wing critics who denounced him for using the harsh word as he brushed off any concerns.
\u201clol they\u2019re so mad \ud83d\ude02\ud83d\ude02\u201d— Maxwell Alejandro Frost (@Maxwell Alejandro Frost) 1685766962
In March, Frost said it was important to call DeSantis out for what he is. "He is abusing his power and using the state to target political opponents and political enemies," Frost said. "And there’s a word for that, and it's fascism, and we have to be honest about it."
Frost, a musician himself, performed and danced with the Tennessee-based band during Friday night's show to loud applause from the youthful audience.
\u201cVery grateful for this moment. I\u2019ve been practicing in the shower for YEARS\u201d— Maxwell Alejandro Frost (@Maxwell Alejandro Frost) 1685766243
"Do you see this?" Williams asked the crowd after the lawmaker's remarks. "Do you see the future right here?"
"Here's the news media's takeaway on the debt ceiling deal: Yay! Bipartisanship works! Here's the reality: GOP radicals held the economy hostage, Democrats paid the ransom, and bipartisanship is badly broken."
President Joe Biden delivered his first televised address from the Oval Office on Friday night to applaud the final result of legislative negotiations between his administration and Republicans in Congress who took the U.S. economy hostage over the debt ceiling, but progressive critics found the victory lap hard to take given the details of the deal and the devastating impacts they will have.
"It was critical to reach an agreement and it's very good news for the American people," Biden said during his remarks from the White House. "No one got everything they wanted but the American people got what they needed. We averted an economic crisis and an economic collapse."
But what Biden called a "big win for our economy and the American people," progressives—who argue the entire debt ceiling law is unconstitutional because it violates the 14th amendment and warned since last year that Republicans would orchestrate a crisis to protect wealthy tax dodgers and corporations while imposing fresh cuts on key social programs—should be seen for what it is: a kick in the face to the planet, democracy, and the material needs of poor and working-class Americans.
"Wall Street and corporate interests may be enthusiastic about this bill, but I believe it moves us in exactly the wrong direction." —Sen. Bernie Sanders
Warren Gunnels, majority staff director for the Senate Health, Education, Labor and Pensions (HELP) Committee chaired by Sen. Bernie Sanders (I-Vt.), said on social media Friday, the final legislation—which Biden is expected to sign into law Saturday—should be seen as "a big win for the donor class and a big loss for the 99%."
"It's nothing to brag about," Gunnels added.
\u201cNegotiating a debt deal that:\n\n-Doesn\u2019t include a penny in revenue from the top 1%\n\n-Increases spending for war profiteers\n\n-Fast tracks fossil fuel projects &\n\n-Increases poverty & hunger\n\nIs a big win for the donor class & a big loss for the 99%\n\nIt\u2019s nothing to brag about\u201d— Warren Gunnels (@Warren Gunnels) 1685753094
"Not everyone got what they wanted?" Nina Turner, former Ohio State Senator and congressional candidate, asked rhetorically. "The 1% and the military-industrial complex got exactly what they wanted."
As Common Dreamsreported, Lockheed Martin CEO James Taiclet this week said Biden signing the agreement into law would be "as good an outcome as our industry or our company could ask for at this point," noting that it calls for "3% growth for two years in defense where other areas of the budget are being reduced."
\u201cThe budget deal struck by the White House & House Republicans sets a damaging precedent shifting federal spending from domestic programs to the Pentagon.\n\nThe deal sets military at nearly 56% of discretionary spending\u2014$886 billion out of $1.59 trillion.\nhttps://t.co/SD91JQSCF3\u201d— National Priorities Project (@National Priorities Project) 1685637613
Journalist and author Mark Jacobs suggested that much of the coverage in the corporate press has been friendly to Biden's framing of the legislative result, but that this should be challenged.
"Here's the news media's takeaway on the debt ceiling deal: Yay! Bipartisanship works!" said Jacobs. "Here's the reality: GOP radicals held the economy hostage, Democrats paid the ransom, and bipartisanship is badly broken."
In addition to across-the-board spending caps for non-defense discretionary spending—which economists note is a real-world cut, given inflation, to key programs that serve tens of millions working class individuals and families—the deal greenlit permitting reforms for oil and gas projects desired by the fossil fuel industry and will force fast-track approval of the controversial Mountain Valley Pipeline that frontline communities in West Virginia, Virginia, and elsewhere have opposed for years.
\u201cThe debt deal protects tax cuts for the rich, gives defense contractors more cash, expedites a fossil gas pipeline during the climate crisis - and makes it harder for starving people to get food stamps.\n\nAnd Biden is now celebrating it as a "big win." https://t.co/UmtUETp3sO\u201d— The Lever (@The Lever) 1685751113
Katie Bergh and Dottie Rosebaum, policy analysts with the Center on Budget and Policy Priorities, detailed this week how changes to the Supplemental Nutrition Assistance Program (SNAP) contained in the deal championed by Biden and Speaker of the House Kevin McCarthy "would put almost 750,000 older adults aged 50-54 at risk of losing food assistance through an expansion of the existing, failed SNAP work-reporting requirement."
"The older adults who lose access to SNAP would lose about $8 per person per day in benefits," explained Bergh and Rosenbaum. "These individuals often have very low incomes, and the loss of SNAP will push most of those affected into or deeper into poverty."
At the same time, the deal championed as a "big win" included large cuts to the IRS budget that a CBO analysis this week showed will actually cost the federal government over $40 billion in lost revenue and increase the deficit—the opposite result of what the GOP claims regarding the budget but very much in line with helping wealthy tax dodgers and corporations pay less each year.
\u201cMcCarthy and the MAGA faction that controls the House GOP held the global economy hostage & were ready to plunge us into a job-killing, retirement plan-erasing, once-in-a-generation recession unless their demands were met.\n\nThat\u2019s not negotiating a deal. It\u2019s extracting a ransom.\u201d— Indivisible Guide (@Indivisible Guide) 1685303159
In a Friday op-ed explaining his opposition to the legislation, Sen. Sanders said the only thing good to say about the bill was that it was not worse—which it certainly could have been.
"At a time when this country is rapidly moving toward Oligarchy, with more wealth and income inequality than we've ever experienced, I could not in good conscience vote for a bill that cuts programs for the most vulnerable while refusing to ask billionaires to pay a penny more in taxes," Sanders wrote. "Wall Street and corporate interests may be enthusiastic about this bill, but I believe it moves us in exactly the wrong direction."
\u201cIt's a disgrace that Republicans brought us so close to the edge of catastrophe during this debt ceiling debacle.\n\nIt simply did not need to happen this way.\n\nWe must abolish the debt ceiling so no party can use it to threaten the livelihoods of Americans for political gain.\u201d— Robert Reich (@Robert Reich) 1685754060
"The fact of the matter is that this bill was totally unnecessary," Sanders concluded in his op-ed. "The President has the authority and the ability to eliminate the debt ceiling today by invoking the 14th Amendment. I look forward to the day when he exercises this authority and puts an end, once and for all, to the outrageous actions of the extreme right-wing to hold our entire economy hostage in order to protect their corporate sponsors."