A pandemic rescue became a 30-year debt trap(thehill.com)
thehill.com
A pandemic rescue became a 30-year debt trap
https://thehill.com/opinion/finance/5692543-small-business-loan-debt-trap/
11 comments
Our government needs to get tf out of the “fixing things” business and back to the “maintaining a framework where people can fix things themselves” business that it was designed to be. Everything they “fix” ends up in much worse shape than it was before.
I didn't need or apply for a CoViD19 business loan, but I know people who did. As I understand it, the loans are FORGIVABLE, so it was basically free money, with some strings attached.
https://www.irs.gov/newsroom/cares-act-coronavirus-relief-fu...
https://www.irs.gov/newsroom/cares-act-coronavirus-relief-fu...
Why the all caps?
Some of the smaller ones were.
Most of the larger ones were definitely not.
"These loans are not forgivable and must be repaid"
https://www.sba.gov/funding-programs/loans/covid-19-relief-o...
Some of the smaller ones were.
Most of the larger ones were definitely not.
"These loans are not forgivable and must be repaid"
https://www.sba.gov/funding-programs/loans/covid-19-relief-o...
Ohh, in Sweden we gave it all away. No loans. It all sprinkled upwards creating many more millionaries. Now we are all enjoying the inflation that you get from printing new money and giving it away.
If the money was given to help people who weren't working due to COVID-19 to pay for necessities such as housing and food, then it is not extra spending than would normally be spent so it shouldn't cause inflation. Perhaps too much money was given or it was given to people who didn't need it. It doesn't need to be a loan to not cause inflation.
We have work insurance, sick insurance, and social funds in Sweden so if you are a drug addict you don't have to live on the street, you get enough to afford a cheep apartment and noodles. The COVID money went to companies, who mostly used it for stock dividend, or buying a sports car. They made pinky finger promise not to fire the staff, but then they did it anyway when rent went up to further increase the profits. Because of work insurance you are not kicked out on the streets, but you will have to sell your house and move to a cheaper place, basically pushing you down to the lowest level of the social ladder, meanwhile those on the higher ladder got pushed up. The shrinking middle class are paying for it all via high taxes and high inflation.
Now do student loans.
Student loans are solved, join the military. It's an ok enough place to last out a recession/depression.
I think this is a suboptimal solution, putting your life at risk (and potentially harming or killing others with no legitimate justification) to avoid debt repayment. There are better ways to increase quality of life while avoiding the debt imho.
The US spent $4T-$6T on wars in the Middle East, and continues to spend $1T/year on the military. Tax cuts for the wealthy from the one big beautiful bill will increase the the deficit by $1T-$4T. This debt is immaterial. The US chooses who should suffer and who should prosper with debt policy, respond accordingly as you would to an adversary.
> There is evidence of systemic stress. Government data show more than 1.3 million Economic Injury Disaster Loan loans are in default, liquidation or charge-off status. Over $70 billion has already been written off, making this one of the costliest disaster-relief efforts in U.S. history. The Small Business Administration tacitly acknowledged the strain by extending deferments several times and introducing hardship tiers that reduced payments to 10 percent, then 50 percent, then 75 percent before requiring full repayment.