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Sec. Mnuchin: Take My PPP Challenge!

Treasury Secretary Steven Mnuchin has said the Paycheck Protection Program is effective in helping small businesses stay afloat. That’s true, in a limited way.

For certain small businesses (with strong professional associations or franchisees), the PPP is effective. For others, such as a Mom-and-Pop shop, the PPP is a maze, they may have to pay an accountant to help access benefits. Equity demands the PPP is presented in a way so all qualified small businesses have the same ability to access PPP funding as a dental or franchisee operation.

If the secretary needs proof of the PPP’s presentation problems, I invite him to take my challenge and see the results for himself.

Sec. Mnuchin, I suggest you run a simulation. Ask the White House to loan you a couple of Marines from the White House detail. Ask for Marines that have a high school diploma, but not a bachelor’s degree.

Put each of them in a room with a computer and a microphone. Encourage the participants to verbalize their reactions to the webpages and associated activities. 

Give them the following scenario: the participant is the owner of a shoe repair store on Eighth Avenue in Manhattan in New York City, zip code 10001. The owner needs PPP funding to help pay the rent on the store. No further information is given to the participant. 

Next, the participant turns on the computer and begins to search the Internet to find the PPP homepage.

Treasury officials should observe the following:

  • How easy is it to find the PPP website? How many discrete clicks are involved?
  • Does the PPP website provide clear information at the top of the webpage? 
  • Does the participant have to scroll down to find vital information?
  • Does the participant have any difficulties comprehending the information, including eligibility requirements? 
  • Are there any words the participant does not understand?
  • After visiting the PPP website, does the participant have a solid comprehension of the application process?
  • Does the participant correctly understand what information he/she is required to apply?

The bottom line for this simulation is quality control. While many pairs of eyeballs in the federal bureaucracy examined the PPP information, the reviewers were concerned with legal misrepresentations, not ease-of-use. The latter involves a very different mindset.

The current information, in its complexity, favors some small businesses over others. We know how corporations with franchisee retailers trained their franchisees in applying and receiving PPP loans. Some corporations, such as Potbelly Sandwiches, returned their franchisees’ PPP funds. Others did not.

Dentists are another group that benefits from the PPP. Dental practices are generally small businesses and various professional societies have been aggressive in getting dentists to apply for PPP loans. There’s nothing wrong about dentists participating in the PPP, but it’s worth remembering how they typically use accountants and receive value for their membership in a dental society (that provides PPP application guidance). 

Contrast those dentists to the shoe repair Mom-and-Pop shop in the simulation. That shop may have a bookkeeper, not an accountant. And the shop stands alone — the owner might pay dues to an organization of shoe repair shops, or not. Unlike dental societies, membership is not a professional requirement.

Mr. Secretary, I encourage you to take my PPP challenge — and bring some much-needed quality control and equity to the application process. The PPP was instituted to help all qualified small businesses and it’s your responsibility to ensure equal access for those businesses.

And let’s not forget that behind every small business is at least one voter. If that voter is frustrated with the PPP process, they’ll remember in November.

Joanne Butler is a senior economics fellow at the Caesar Rodney Institute of Delaware.

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