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Will Blacks benefit from the stimulus bill?

Earl Ofari Hutchinson

Trump took much-deserved heat for deliberately and vindictively gumming up the works in not immediately signing the $900 billion second stimulus bill. The list of those hurt by the delay runs off the chart: renters, the unemployed, small- and medium-sized businesses, and millions of the neediest of the needy. As usual, African Americans are a disproportionate percent of the needy.

But even if Trump had put signature to the stimulus package immediately, it wouldn’t help many Blacks. It’s not just the relatively miserly amount of money ladled out. Nor that the stimulus is again top-heavy with big payouts to corporate industry groups from airlines to big hotels. Nor is it the paltry $600 payouts to individuals.

The inherent disparity in who gets what and when or even if they get anything was glaringly apparent in the first stimulus, much bigger and more expansive, last spring. Blacks were far less likely to get a check than whites. They were far less likely to receive a payment on the same timely basis as whites. They were far less likely to have access to bank and savings accounts to put the money in if they received it.

Surveys on consumer buying habits and needs found that the money received barely covered the debt and needs of many Black recipients. They were more likely to be behind on their rent or mortgage payments, more likely to have been laid off from jobs and far more likely to be unemployed longer than whites. They were also far less likely to receive unemployment benefits than whites.

The COVID stimulus disparity was nowhere more evident than in the plight of small Black-owned businesses. The estimated 2.5 million Black-owned businesses make up almost one-third of the eight million minority-owned businesses in the U.S.

Ninety percent of minority businesses did not get a nickel of money from the Payroll Protection Program. For Black-owned businesses, the number is even worse — 95% got no funding.

In several informal polls on my Facebook pages, I asked this question: “Did you know of any Black owned business that got a COVID stimulus SBA Payroll Protection Program Loan?” There were a handful of “yes” responses. There was an avalanche of “nos.” Some expressed optimism that the grim shutoff of the money spigot to Black businesses would change with the $3 trillion stimulus package. It did, but only marginally. Many Black businesses at that point were too far gone to be saved, even if they could have qualified for a COVID stimulus loan or grant.

Trump, congressional leaders and Treasury officials loudly pledged that small businesses were a prime target of the aid program. There were much-publicized online workshops and town halls on how to apply for funding. Many banks announced that they had funds, and encouraged businesses to apply. House Democrats sweetened the pot by prying $60 billion out of the loan package for minority banks. Yet, the number of Black businesspersons who got money has barely budged.

There is much justified finger pointing at the SBA, Treasury officials, corporate and bank lobbyists for lax to nonexistent oversight, lax rules on who could get the money, and for earmarking far too much of the half-trillion in loans to major corporations. There is equally justified finger-pointing at the banks for tossing up a mountain of paperwork, tax and business filing documents, and accounting requirements that small business owners had little chance of hurdling. Then there was the confusion and constant changing edicts about how the money could be used and what, if any of it, had to be paid back. In the months since then, little has changed except the desperation of countless distressed Black small-business owners.

The first stimulus had virtually no lasting impact on lifting Blacks out of their disproportionate poverty or damping down the mountainous debt of many Blacks. The reason is simple. Blacks had greater indebtedness and were poorer than whites long before COVID hit and the first stimulus payment was issued. The money many received was just a drop in the bucket against their needs.

The first stimulus, on paper anyway, was at least worthy of the name. The same can hardly be said of the second stimulus. Whatever money comes certainly is welcome. But for many Blacks, it will again still be the case of “show me the money” that won’t be there for them.

Earl Ofari Hutchinson is an author and political analyst.

opinion, stimulus