Written By: Anton Sawyer
In an attempt to maintain complete transparency, all research and statistical fact-checking for this article, and all articles, can be found at our site's bibliography linked here.
I have learned throughout the years that when it comes to giving away money, the United States government really doesn't like to do it ... unless it's on their terms.
Though COVID-19 was not on ANYONE'S terms for anything (except its eradication), it forced the hand of Washington leaders into a situation where a lot of money was going to be needed to save our economy. With the stock market tanking at the time, millions of people being furloughed or fired, and income streams drying up due to people being ill, pumping a huge stimulus of cash into the economy was imperative.
The House, Senate, and former President Trump jumped into action and created the “Coronavirus Aid, Relief, and Economic Security Act” (CARES) Act. It was one of the largest stimulus relief and payment programs in the country's history. It had a lot of minutia in it, but it was ultimately broken down into three main benefits: The Paycheck Protection Program, Economic Impact Payments, and Mortgage Forbearances. It took a few months to get almost everything out to everyone available. Once this had been completed, the list of those who received deposits or assistance from the CARES Act began to trickle out.
While digging through all of the financial spreadsheets of the CARES Act, many law offices and individuals started to see an alarming trend. One where companies may have had the right amount of employees to meet the threshold, but were not hit with such an immediate need to where the business would shutter for good. This investigation brought about a number of lawsuits because so many companies were getting government handouts when they didn't necessarily need them.
According to Severson & Werson law offices, the "Paycheck Protection Program" or PPP, is implemented by the Small Business Administration with support from the Department of the Treasury. The program enables lenders to provide small businesses with loans to pay up to eight weeks of payroll costs including benefits. Funds can also be used to pay interest on mortgages, rent, and utilities. PPP loans will be forgiven if a business restores its full-time employment and salary levels by June 30, 2020. The program was initially funded with $350 billion, but funds were exhausted just two weeks after the program’s inception. On April 24, 2020, however, Congress infused the PPP with an additional $310 million in funding. Since it's release, a number of different government spending agencies and law offices began seeing companies receiving funds that perhaps should not have been.
Restaurant chains P.F. Chang’s China Bistro and Chop’t received financial aid of between $5 million and $10 million. Numerous news organizations also received PPP loans: Forbes Media got at least $5 million; The Washington Times got at least $1 million; The Washingtonian got at least $350,000; The Daily Caller received at least $350,000 and The Daily Caller News Foundation got at least $150,000; The American Prospect received at least $150,000. In addition to the numerous news outlets, there were also a number of religious and political organizations that received millions of dollars in "relief"—further illustrating that there is no separation of Church and state in the US. The Ohio Democratic Party got at least $150,000 and the Florida Democratic Party Building Fund got at least $350,000, while the Women’s National Republican Club of New York got at least $350,000, the Black Republican Caucus in Florida got at least $150,000. The Archdiocese of New York got a loan valued at between $5 million and $10 million, while the Catholic Charities of the Archdioceses of San Francisco, Washington, D.C., New Orleans and Boston, among others, all received assistance valued at more than $2 million. When looking at what was supposed to be the qualifiers for a business to receive this assistance, it's hard to believe that all of these companies were hemorrhaging money so much as to guarantee their demise.
One lawsuit contends that the guidance of CARES Act funds "is an unlawful interpretation of the CARES act, which allows private schools to get a disproportionate amount of Title I funds — traditionally reserved for low-income students." Although a portion of those funds is allocated to private schools to provide "equitable services" to students, the department's interpretation allows it to count all students for purposes of the funding formula instead of just those who qualify for Title I assistance, according to the lawsuit.
In April, another lawsuit came about from the Mexican American Legal Defense and Educational Fund (MALDEF). The suit was done on the behalf of U.S. citizens who were denied federal stimulus checks for which they were otherwise eligible solely because they filed joint tax returns with spouses who use an Individual Tax Identification Number (ITIN). ITINS are issued by the Internal Revenue Service to noncitizens who lack a Social Security number so they can pay taxes.
According to the IRS: the IRS issues ITINs to help individuals comply with the U.S. tax laws and to provide a means to efficiently process and account for tax returns and payments for those not eligible for Social Security numbers. They are issued regardless of immigration status, because both resident and nonresident aliens may have a U.S. filing or reporting requirement under the Internal Revenue Code. ITINs do not serve any purpose other than federal tax reporting.
I did not know about the ITIN before I began researching this article. I was not aware that there was such a thing. Because of the vastness of what's involved in the legalities of the government allowing such a program, there will be an upcoming article about this specifically. For the purpose of this piece, we're just focusing on the lawsuit specifically.
War can sometimes make for strange bedfellows, and all the problems that the original CARES Act brought about have put two Washington leaders together that one would never think could be a reality.
Conservative Sen. Mike Lee, R-Utah, and liberal Rep. Alexandria Ocasio-Cortez, D-New York. Both were in agreement that Congress had been given too little time to review the latest 5,593-page federal budget bill. “It’s not good enough to hear about what’s in the bill. Members of Congress need to see and read the bills we are expected to vote on.” Ocasio-Cortez wrote December 21st on Twitter. A few hours later, Lee tweeted “I agree” in a reply. The Utah senator went on to post a video denouncing the process. “I’ve been in the Senate now for 10 years, and this is by far the longest bill I’ve ever seen. Because of the length, it is impossible that anyone will have the opportunity to read it between now and the time we will vote.”
They aren't wrong.
Oftentimes we as citizens expect our leaders to always be in the know with everything. Because of the severity of the pandemic and how it had ravaged the economy, a stop-gap was needed immediately. Looking into some of the bill, there are a lot of changes that could be really good, or really bad, depending on perspective.
The most popular section that will be seen as a Godsend to all is an end to most forms of surprise medical billing.
Conversely, the one portion that is the most divisive is the inclusion of the most significant climate-change legislation in at least a decade (and arguably ever)—which is a surprise given how little the republicans want any funding to go towards that.
At the end of the day, we get what we get.
We can complain about what is, or isn't, in this new legislation. We can try to hold our congressional representatives accountable for what they pass, and completely ignore the severity of the circumstances. I do implore you to visit the actual legislation linked below. It can be wordy, but this site has never been about being "easy," but rather about getting as many people as educated as possible.
Become A Site Member To Remain Informed