If you give people at the bottom a choice to not work, by giving them cash directly, then they would have better negotiating power versus employers.
The employers would then have to raise wages, and therefore prices. That means consumers who were proportionally consuming more than others have to consume less as more of the wealth goes towards paying higher wages. And we don’t want that as a society.
So we make the aid contingent upon an employer who might bless you with a furlough so you can collect the temporary generous unemployment, but also yank it away in case your menial work is necessary and they can go back to paying you near minimum living wages.
My point was the argument that the government design PPP as an effort to perpetuate an existing system that reduces employees bargaining power and prefers businesses can’t be supported when the government specifically strengthen employees bargaining power.
The powers that be know that loans obligations have been made that can only be satisfied if labor costs remain contained. Their primary objective is to make sure the mortgages keep getting paid, and paying employees double would endanger that.
An easy illustration is the fact that “essential” employees at much higher risk of getting the virus are getting paid with their old near minimum wage per hour jobs with signs that say “heroes work here”, and their management bosses are working safely at home with minimal risk of covid earning the same pay.
White collar employees continue to earn higher salaries from the safety of their home, and “hero” janitors and housekeepers are getting the same $10 to $15 they received as before, except they get to deal with higher chances of coronavirus.
I suspect what you would find is not some grand conspiracy but emergent properties from competitive forces.
And a lone businessman can’t just pay workers more and make the world right. If I decide to pay people more, and run the numbers and figure out I can afford to spend $5M on a piece of land to develop, and my competitor decides to project paying people much less, they can afford to spend $6M for the same piece of land. So guess which business ends up existing? The one that doesn’t pay higher wages. Same situation with people choosing to shop at stores that offer lower prices.
It would have to be a nationwide effort to transfer wealth, such as UBI or higher minimum wages. Otherwise we keep going as is with an ever widening wealth/income gap.
These loans don't cause unemployment. Those same people would be unemployed even if those same businesses didn't apply for the loan.
We are only a few months into a multi year pandemic, so even if a company isn't suffering yet, they most likely will be soon. Getting a loan while it is available to preserve jobs as long as possible as the pandemic gets worse sounds like a sensible and ethical thing to do.
I would never announce a financial problem or ever publicly announce employees let go. It would harm my contracts with vendors.
I just searched my local city and noticed that our (for profit) ambulance service received a loan:
> DIAZ MEMORIAL AMBULANCE SERVICE INC
I definitely don't think they saw the number of ambulance rides go down. And also don't think their profits suffered.
I wouldn't be surprised to learn that emergencies are a small portion of what ambulances are used for, but I don't have access to that data.
I'm friends with an ER nurse and she was saying that the ER was almost completely empty during the first few weeks of COVID-19 because everyone was staying home out of fear.
Covid hasn't been prevalent enough to increase ER visits in most of the country (until now) and other people have been avoiding going to the ER unless on deaths door. Not to mention the lack of driving has probably plummeted car accident rates. I remember reading that organ donors are in short supply.
People who would otherwise have gone to the ER, even if not strictly necessary, were hesitating, "do I really need to go, perhaps not".
And then on the other side, you had people who really _should_ go not wanting to, due to fear.
Both ambulance services in my county were shutting down ambulances and furloughing employees heavily.
-- a paramedic
Probably because there's no way he could possibly know what "business as usual" was for any company where he wasn't employed. He has no idea what each company's financial situation is and is merely spouting cynicism.
I definitely don't think they saw the number of ambulance rides go down.
Is this something you monitor? Is there even a way to do that with a private ambulance company?
Considering the number of medical providers, doctors' offices, and hospitals that had business plummet to catastrophic levels, I think you're imagining things.
I work in healthcare, and just off the top of my head can think of several medical clinics and pharmacies that shut down because of pandemic-induced financial difficulties.
But let’s assume your premise; it’s likely their costs went up dramatically between Personal protective equipment, hazard pay, quarantine procedures for exposed employees etc.
Ambulance services are capital intensive (ie large Debt payments) and low margin. A 20% drop in revenue would bankrupt the company.