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Economy

Small Business Admin Runs Out Of COVID Loan Money, Needs Congress To Act

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The U.S. Small Business Administration is no longer able to accept new applications for the coronavirus emergency loan program after hitting its $349 billion limit Thursday, according to their website. The advance provides businesses with up to $10,000 that doesn’t need to be paid back and is provided for them to stay afloat in the coronavirus pandemic.

“BA is unable to accept new applications at this time for the Economic Injury Disaster Loan (EIDL)-COVID-19 related assistance program (including EIDL Advances) based on available appropriations funding,” the SBA notice stated.

The SBA reports that the number of applications received in the last 14 days is more than 14 years of loan applications. Their statement continued, “Applicants who have already submitted their applications will continue to be processed on a first-come, first-served basis.”

On March 27, the CARES Act budgeted $376 billion to American businesses and workers. In a joint statement released Wednesday, Treasury Secretary Steve Mnuchin and SBA Administrator Jovita Carranza urged “Congress to appropriate additional funds for the Paycheck Protection Program—a critical and overwhelmingly bipartisan program—at which point we will once again be able to process loan applications, issue loan numbers, and protect millions more paychecks.”

They added, “The high demand we have seen underscores the need for hardworking Americans to have access to relief as soon as possible. We want every eligible small business to participate and get the resources they need.”

U.S. lawmakers remain in a stalemate over appropriating additional funding. In an effort to bridge the partisan gap, Mnuchin is reportedly working with Democrats who voted against the GOP’s $250 billion bill in the Senate last week. The Senate, however, isn’t scheduled to be back in session until April 20, but may be forced to call an emergency session to provide needed funding.

In a letter sent to Republicans last week, House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer asked for additional funding of hospitals, personal protective equipment (PPE), and the food stamps program to be included in the next bill.

House Minority Leader Kevin McCarthy, R-CA, said Thursday on Twitter that the failure to get additional funding “is on you, Chuck Schumer and Nancy.”

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Politics

The Looming National Debt Crisis: The Uncomfortable Truth No One Wants to Discuss

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As Republican candidates gather for a debate, the skeleton in the closet remains the ballooning national debt, a subject that’s largely been relegated to the shadows of political discourse.

While the candidates may briefly touch upon the issue and offer surface-level solutions, the uncomfortable truth is that addressing the national debt’s growing burden would require difficult, unpopular choices. Candidates find themselves in a precarious position, tasked with both solving the problem and securing votes, all within the constraints of a 90-second debate response.

Since surpassing the $33 trillion debt threshold, the United States has been accruing over $800 million in new debt every hour, adding more than $2 billion daily in interest payments. The most recent debt ceiling bill has suspended any cap on this debt until January 2025, casting a long shadow over the nation’s future freedom and prosperity.

Democrats have occasionally pointed to the “Trump Tax Cuts” as a driver of the deficit. However, the tax cuts did stimulate economic growth and resulted in record-high Treasury revenues, albeit without corresponding spending cuts.

One feasible solution begins with fixing the federal budget process, though it is by no means an easy task. Nonetheless, it would substantially rein in Congress’s control over the spending pie chart. A recent Heritage study revealed that only 10 percent of the $7.5 trillion in COVID-related spending actually went to healthcare. The remaining 90 percent, charged as overhead and other expenses, underscores the need for significant reform.

According to reports from Fox News, while the discretionary budget, including debt interest payments and defense spending, constitutes less than 25 percent of overall expenditures and continues to shrink, the true driver of federal deficits lies in mandatory, programmatic spending. These are expenditures Congress does not address annually but continues unabated.

Furthermore, they encompass popular transfer programs such as Medicare, Medicaid, Social Security, student loans, and healthcare initiatives like Obamacare, among countless others. Altering these programs involves a political third rail, a risk few presidential candidates are willing to take.

Mandatory, programmatic expenditures are perpetual and don’t undergo annual scrutiny or adjustment. There is virtually no constituency for tackling these fundamental issues, despite their role as the primary drivers of the nation’s fiscal challenges.

Many citizens believe that trimming discretionary spending, such as congressional salaries or foreign aid, or rooting out “waste, fraud, and abuse,” can resolve the debt problem. While these are valid concerns, the real target for reform should be mandatory, programmatic spending to ensure the sustainability of essential programs.

The Republican candidates vying for the nomination face a daunting question: Who among them possesses the courage and leadership to make the unpopular decisions necessary to restore fiscal responsibility to the nation’s future?

On the other side of the aisle, Democrats seem unlikely to embrace responsible spending as part of their agenda, leaving the issue largely unaddressed in their political DNA.

In a political landscape dominated by divisive issues and partisan debates, the national debt looms as the silent crisis that few are willing to confront.

The path to fiscal responsibility requires acknowledging the harsh reality that popular programs must also be on the table for reform. Only then can America hope to secure a stable financial future for its citizens.

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