Don’t Worry About PPP

Eric Medlin

History instructor. Writer. Rising star in the world of affordable housing.

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63 Responses

  1. Philip H
    Ignored
    says:

    As you noted at the beginning, no one on the left is attacking the program itself. It did enormous good. What they are attacking is the hypocrisy of those who benefitted directly from PPP but refuse to extend the grace of that forgiveness to others suffering from even more egregious debt problems. That you then go one for the rest of the post describing how that attack is misinterpreted without pushing back on said misinterpretation is, well, problematic.Report

    • DensityDuck in reply to Philip H
      Ignored
      says:

      I know that those “it’s possible to be both” memes are popular with dudes like you, so here’s one:

      It’s possible to be both supportive of the idea that the government ought to help businesses that closed at its order to pay their employees’ wages AND critical of the idea that the government ought to give a bunch of free money to a bunch of white people who went to college mostly because they couldn’t think of what else to do with their lives and figured that four more years of high school might give them an idea.Report

      • Philip H in reply to DensityDuck
        Ignored
        says:

        Most of the PPP loans never went to pay wages to labor:

        NBER analysis of PPP found that 75% of PPP funds went to business owners, shareholders, creditors, and suppliers and roughly 25% to workers who would have otherwise lost their jobs.

        https://www.investopedia.com/where-ppp-money-went-5216725#:~:text=Roughly%2025%25%20of%20PPP%20loan,suppliers%20of%20companies%20receiving%20loans.

        That aside, we aren’t saying the PPP was a bad idea. Just that if the PPP was a good idea (even when it didn’t pay actual wages) then this is too.

        We are also not saying this round of student loan forgiveness is the most equitable thing either – fewer blacks will get forgiveness then whites in absolute terms because fewer blacks go to college. Which is a structural issue that this action doesn’t address. However, blacks will still benefit, as they have more student debt (on average) and make more use of Pell grants, which means they will be eligible for greater forgiveness.

        But you knew all that already I’m sure.Report

        • DensityDuck in reply to Philip H
          Ignored
          says:

          “Most of the PPP loans never went to pay wages to labor:”

          oh look, here’s someone on the left attacking the PPP program

          “We are also not saying this round of student loan forgiveness is the most equitable thing either ”

          why are you doing it, thenReport

          • Philip H in reply to DensityDuck
            Ignored
            says:

            An attack on PPP would be “it was a dumb idea bereft of any economic sense designed to buy the support of business owners.” Pointing out that it missed the mark – as do many things coming out of DC – is just an observation meant to push back on your assertion that “the government ought to help businesses that closed at its order to pay their employees’ wages” since the PPP didn’t, in fact, pay a lot of wages.

            As to why student loan debt cancellation now? For starters the President campaigned on doing so. And this isn’t his first round – he’s cancelled debt from predatory private “colleges” as well. That aside he believes it makes good economic sense, and I suspect he wanted to make sure we were well past COVID before moving on it.Report

            • DensityDuck in reply to Philip H
              Ignored
              says:

              “Pointing out that it missed the mark…”

              …is an attack on it. You might be very invested in the notion that you aren’t attacking it, you might really want to not be attacking it, you might be genuinely worried that your entire point goes “poot” and falls over if you’re attacking it, but “most of the PPP money didn’t get actually directly pay worker wages” as as much of an attack as “the vast majority of student loans being forgiven were held by white people who already had steady jobs, were not in any particular economic hardship, and had plenty of chances to look at what they were getting into before they took the money”.Report

              • Philip H in reply to DensityDuck
                Ignored
                says:

                So then every fact checker is attacking the things they fact check?

                You live in an interesting world my dude.Report

              • Jaybird in reply to Philip H
                Ignored
                says:

                The number of “fact checks” that are actually spin is too damn high.Report

              • Philip H in reply to Jaybird
                Ignored
                says:

                I’m not sure pointing out facts you find inconvenient or that contravene your preferred outcome makes them spin. I also don’t think pointing out the PPP only paid 25% of its funds to salaries is an attack on the PPP. Make of that as you will.Report

              • DensityDuck in reply to Philip H
                Ignored
                says:

                “I’m not sure pointing out facts you find inconvenient or that contravene your preferred outcome makes them spin.”

                like the inconvenient fact that fewer than five percent of student-loan borrowers were actually more than ninety days delinquent?Report

              • Philip H in reply to DensityDuck
                Ignored
                says:

                What does that have to do with anything? You think because people are up to dat eon their payments they don’t deserve forgiveness?Report

              • DensityDuck in reply to Philip H
                Ignored
                says:

                “You think because people are up to dat eon their payments they don’t deserve forgiveness?”

                …if you’re trying to convince me that student-loan forgiveness was a vital issue and should be subject to less scrutiny and analysis than the PPP, that’s a very odd thing to say!Report

              • Philip H in reply to DensityDuck
                Ignored
                says:

                I’m just wondering why you are working so hard to shill for the corporations who benefitted from the PPP – based on actual data from disbursements and required reporting (which led to forgiveness) – while at the same time bashing the student loan forgiveness program based on forecasts and anticipated data. I never took you for a corporation loving neoliberal, but I suppose things can change.Report

              • DensityDuck in reply to Philip H
                Ignored
                says:

                “I’m just wondering why you are working so hard to shill for the corporations who benefitted from the PPP”

                You certainly seem quite excited to shill for upper-middle-class whites who are getting free money from the government to pay for loans they could already afford.

                Why is that, I wonder?Report

              • Philip H in reply to DensityDuck
                Ignored
                says:

                I don’t have student debt. Never did. And what loans my parents took to close the gap between my student workers wages, my scholarships and my tuition and room and board were paid off two plus decades ago. Plus I make too much money now to qualify.

                90% of relief goes to people making $75,000 a year. That’s not upper middle class. Lower middle class – maybe in urban areas. And the Pell grant forgiveness – which doubles the benefit to $20K – is expected to go to families with total family income around $60K a year. Again, NOT upper middle class.

                Now could those folks afford their loans? maybe, but why begrudge them the help?Report

              • Dark Matter in reply to Philip H
                Ignored
                says:

                90% of relief goes to people making $75,000 a year.

                The U.S. Census Bureau estimated median annual earnings at $41,535 in 2020 for workers aged 15 and over with earnings and $56,287 in 2020 for those who worked full-time, year round.

                Median household income is $67k, although since there could be multiple family members taking advantage of this it might be a personal thing.

                Now median income for someone without college is $32k.Report

              • Slade the Leveller in reply to Jaybird
                Ignored
                says:

                Philip relayed but one fact here, one that DD seems happy to elide.Report

  2. Kristin Devine
    Ignored
    says:

    As some may recall, I wrote in favor of student loan forgiveness sometime back https://ordinary-times.com/2019/04/25/a-conservative-case-for-student-loan-forgiveness/, AND my kid will be one of the beneficiaries of the forgiveness, so…

    There are some spectacular lies in this article, so laughably egregious I won’t even bother. But it’s a whopper of a lie to say that only conservatives think the way this is being done is a bad idea. I’ve read lots of articles from Democrats of all stripes who have misgivings about this scheme, and including two articles yesterday from straight up socialists saying this is an ill-advised program that didn’t tackle the root causes of the student loan crisis, is replete with terrible incentives and cobra effects, and is a thinly veiled attempt to buy votes for Democrats.

    Did you not research, or are you deliberately trying to mislead?Report

  3. Saul Degraw
    Ignored
    says:

    Always a good sign when the cultural resentments fly early in a thread.Report

  4. Chip Daniels
    Ignored
    says:

    IN the battle for the hearts and minds of the low info voters (i.e., about 99% of voters) the criticism by the White House hit the target with a bullseye.

    The attempt to make my PPP loan forgiveness okay while your college loan forgiveness not okay would always be an uphill struggle because it doesn’t have any clear convincing logic as to why this should be so.

    Asserting that the college loans went to spoiled affluent people?
    The PPP recipients are every bit as privileged.

    Doesn’t get at the root cause of college bloat?
    True but irrelevant. PPP wasn’t meant to get at the root cause of anything, but merely pumped money into people’s pockets to keep them spending on consumer goods.
    The college loan forgiveness works the same way, allowing young households to spend money on consumer goods instead of loan payments.

    Which leaves that it may be inflationary as the strongest argument.

    The problem is that inflation is a bit like global warming, a very large, abstract problem with no clear and simple solution. From an inflationary standpoint, winding down the Afghan war probably saved more money than forgiving college loans.

    So yeah, as a bit of economic policy, I am ambivalent about it, but as a bit of political strategery, it was damn clever.Report

    • Saul Degraw in reply to Chip Daniels
      Ignored
      says:

      Oh hush, you know the Calvinball rules only allow Republicans to do these things. If Democrats do it, it is unfair and mean.Report

      • LeeEsq in reply to Saul Degraw
        Ignored
        says:

        It isn’t cricket as they say. I like that the Democratic Party is getting back to knife-fighting.Report

      • Chip Daniels in reply to Saul Degraw
        Ignored
        says:

        Heh.
        Yeah there’s quite a bit of “How dare the Dems play politics and win” going on.

        I never like to play Savvy Pundit since it breeds cynicism but I think Biden is demonstrating an important point here.

        We as a nation have seen massive transfers of wealth upward from the working class to the investment class. Everything from ag subsidies to military contracts, from the 2008 TARP bailout to PPP forgiveness.

        So it’s illustrative that this time, for once the transfer of wealth is going the other way, putting cash in the pockets of working people.

        Which then raises an even bigger question- why don’t politicians promise to improve the lives of ordinary citizens?
        When you scan across the past few decades of American politics it’s freakishly unusual for a politician to campaign on explicit promises of putting more cash in people’s pockets.

        Even this college loan forgiveness is cautious and modest, carefully targeted and hedged and qualified.Report

        • Saul Degraw in reply to Chip Daniels
          Ignored
          says:

          That being said, this is another place where the Hack gap is real and a good number of Democrats (not a lot but a vocal minority) can’t get over their priors and see this as a cash transfer to the wealthy that is wrong. I disagree with this small but vocal minority but the hack gap does rear its ugly head for these things.Report

          • Philip H in reply to Saul Degraw
            Ignored
            says:

            Are you calling the student loan forgiveness program a transfer to the wealthy? Are incomes below $125K a year wealthy?Report

            • Saul Degraw in reply to Philip H
              Ignored
              says:

              I’m not but I have seen it and not just from Republicans. There is a feel fact out there against student loan forgiveness or free college because a lot of middle class and above people attend so it gets “classified’ as a reverse wealth transfer as opposed to a universal right. The assumption seems to be that lower-income people would still not attend even if more affordable.

              Corporate Democrats are still stuck in this 1990s frame.Report

            • LeeEsq in reply to Philip H
              Ignored
              says:

              Many people basically see anybody who goes to college or graduate school as being affluent because of the alleged higher earning capacity. If they don’t earn more than average, it is because they picked the wrong major. Now this really isn’t the case anymore but it doesn’t help people from thinking this way.Report

              • Jaybird in reply to LeeEsq
                Ignored
                says:

                Well, there’s also the whole issue of “class”.

                Can you be “middle class” if you’re only making $X dollars a year instead of $3X?

                We know that making $X a year isn’t *THAT* much if you’re living in (city), or (city), or (city) even if that means that you’re making more money than 90% of the rest of the country.

                The cost of living is more.

                But does “middle class” extend down as well if you have a degree in (humanities), (humanities), or (humanities)?

                What about a master’s degree in it?Report

              • Dark Matter in reply to LeeEsq
                Ignored
                says:

                If they don’t earn more than average, it is because they picked the wrong major. Now this really isn’t the case anymore but it doesn’t help people from thinking this way.

                If you drill down to the expected income by major, major matters A LOT.

                Problem is those stats are amazingly well buried/not used. The media, if they break out majors at all which is rare, likes to lump “all engineers” or “all humanities” majors together. More commonly the STEM majors will be grouped into the Humanities and we’ll look at everyone with a BA as though they’re all the same.

                https://www.thinkimpact.com/average-college-graduate-salaries/

                At one point I had data which broke it down into 300(ish) majors but I can’t find that at the moment.Report

              • Michael Cain in reply to Dark Matter
                Ignored
                says:

                I don’t know if it’s still true, but it used to be common knowledge that economics majors got significantly higher salaries than any of the other social sciences. The answer most often given by hiring managers when asked about it was unpopular: finishing an economics degree requires demonstrating reasonable numeric skills; the others don’t.Report

              • Jaybird in reply to Michael Cain
                Ignored
                says:

                Kristin linked to her post above and going through the comments, I saw where we had a list of the highest-paying degrees out of the gate.

                10. Mechanical Engineering
                Median starting salary: $65,619

                9. Mathematics & Computer Science
                Median starting salary: $66,499

                8. Materials Engineering
                Median starting salary: $67,385

                7. Systems Engineering
                Median starting salary: $68,018

                6. Aerospace & Aeronautical Engineering
                Median starting salary: $68,142

                5. Electrical Engineering
                Median starting salary: $69,039

                4. Computer Engineering
                Median starting salary: $70,120

                3. Chemical Engineering
                Median starting salary: $72,126

                2. Nuclear Engineering
                Median starting salary: $73,267

                1. Petroleum Engineering
                Median starting salary: $97,689

                Now, 2019 and 2022 have had a lot of things happen between but I think that 2022’s list would be mostly similar.

                Maybe a new entry towards the bottom (Philosophy?) and the rest reshuffling somewhat and one of the lower ones dropping off.Report

              • Dark Matter in reply to Jaybird
                Ignored
                says:

                Rename #9 to “Software Engineering” and it’s a clean sweep.Report

              • Dark Matter in reply to Michael Cain
                Ignored
                says:

                Might be that journalism majors flinch away from admitting their major always had an expected return of what they’re getting.

                Might also be that journalism majors lack the math to understand the raw data (or even the idea of raw data).

                There’s also the problem that Professors of X don’t want to tell their students they’d be better off studying Y (going public with that knowledge would damage the field of X and might result in fewer Professors of X).

                It’s also not in colleges best interests to admit that many of their majors don’t have positive ROI.Report

            • Pinky in reply to Philip H
              Ignored
              says:

              People who are a few years out of med school or law school are on their way to being wealthy. People who got degrees in low-paying fields aren’t making decisions based on finances, so while they might not be wealthy, they’re not lower-class.Report

              • Philip H in reply to Pinky
                Ignored
                says:

                Ah yes let’s dunk on education majors and music majors and womens studies majors and the divinity majors and the like. Because when people listen to the pop culture advice or their hippie parents and follow their passions they almost always do so with the understanding they won’t make bank.clearly they don’t deserve any help because they aren’t all after the mighty dollar – to say nothing if those pesky oceanographers or climate scientists.Report

              • Jaybird in reply to Philip H
                Ignored
                says:

                If we agree that the degrees aren’t worth what the kids getting them are paying for them, then the problem is not one that will be fixed by shaming people into phrasing it nicer.Report

              • Slade the Leveller in reply to Jaybird
                Ignored
                says:

                Do we want to consider ROI as a factor for college costs? Time was, going to college and getting a well-rounded education was considered a goal unto itself.Report

              • Jaybird in reply to Slade the Leveller
                Ignored
                says:

                What does ROI stand for?

                “Return on Investment”

                Who is getting this return? If it’s not the person in question, and it’s not their employer…

                Who is it?

                Who is getting the ROI?Report

              • Dark Matter in reply to Jaybird
                Ignored
                says:

                If it’s society that’s getting the ROI, then I want a way to evaluate this activity/return and I also want to know how many other activities we do this for so we can get their ROIs.

                IMHO that whole line of reasoning is putting an emotional argument on what should be a math evaluation, and an individual math evaluation at that.

                Society is better off if a number of people go to college and get degrees. We’re FAR PASSED the point where that handwave makes sense if we don’t have great jobs for every college grad.Report

              • Jaybird in reply to Dark Matter
                Ignored
                says:

                I think that the argument is that people who go to college learn a handful of things that make them more well-rounded human beings and it’s that well-roundedness that we, as a society, want to cultivate.

                I’m just not sure that that we actually get the well-roundedness that is actually promised. Nor do I think that college is the one place where we can get the well-roundedness actually delivered. Nor do I think that the well-roundedness we actually get is worth the price tag.

                And that’s without getting into the issue of whether the well-roundedness that is promised is worth the price tag.Report

              • Dark Matter in reply to Jaybird
                Ignored
                says:

                The whole line of reasoning comes from a time period when we had great jobs for every college grad.

                There was a huge amount of signal going to college. It meant you were white, rich, well connected, and could read/do-basic-math.

                That’s the definition of “well rounded”, and it’s lost it’s signal with mass education.Report

              • Damon in reply to Dark Matter
                Ignored
                says:

                Hell, well rounded was what I had to be in HIGH SCHOOL. I had to take 4 years of math, english, history and science, and a foreign language. That was the minimum, plus some sport. My parents gave me the side eye when I took a evening acting class for kicks. Pretty much everyone I grew up with, if they weren’t taking over the family farm/ranch, was going to college, and a lot of the guys who were taking over the farm went to college for the ag degree.Report

              • Slade the Leveller in reply to Jaybird
                Ignored
                says:

                The immediate beneficiary of any ROI is the investor. What kind of question is this?Report

              • Jaybird in reply to Slade the Leveller
                Ignored
                says:

                Because we have a bunch of investors screaming that they have invested in an item that should not have charged them what was charged and there is currently a debate over whether we should give these investors debt relief for their purchase or not.

                And the people arguing for debt relief seem to agree that the ROI is nowhere near what was promised.

                Else they’d, you know, say “yeah, pay it off. You are the primary beneficiary of the degree you got and it was worth it.”Report

              • Dark Matter in reply to Slade the Leveller
                Ignored
                says:

                Time was, going to college and getting a well-rounded education was considered a goal unto itself.

                Happy marketing talk put out by the Colleges themselves.

                Or if we go back far enough in time, it’s a goal in itself because only the rich could/would do it (college educated was rare) and/or college was so cheap it was a no-brainer.Report

              • DensityDuck in reply to Slade the Leveller
                Ignored
                says:

                “Time was, going to college and getting a well-rounded education was considered a goal unto itself.”

                Is that worth going into debt over?Report

              • Slade the Leveller in reply to DensityDuck
                Ignored
                says:

                Perhaps, perhaps not. I got an M.A. almost entirely financed by debt in the late ’80s, but that debt got into the 5 figures by the barest margin, like to the dollar.

                The price of college has gone up considerably since then, and I sent 2 kids through private college at those prices.

                College now is priced like a luxury good. As long as employers are going to require a degree to even walk into an interview, people are going to have to finance.Report

              • Jaybird in reply to Slade the Leveller
                Ignored
                says:

                I graduated college with “some debt”. It was somewhere between $600 and $800. The debt was paid by the end of the summer.

                Was my degree worth it? HELL YES!!!!

                But I did not pay the price of a house to get my degree.Report

              • Slade the Leveller in reply to Jaybird
                Ignored
                says:

                What would your situation be if you graduated from the same college this year?Report

              • Jaybird in reply to Slade the Leveller
                Ignored
                says:

                Different.

                Like, to the point where I might say something like “the ROI for a degree is negative now” (depending on the major, of course).Report

              • Dark Matter in reply to Philip H
                Ignored
                says:

                clearly they don’t deserve any help…

                Actually yes, they don’t deserve any help. They took out loans for an experience without any plans on how to pay for it.

                That’s dysfunctional behavior that deserves to be punished, not encouraged.

                It especially isn’t justification for reaching into my wallet.

                The real solution for people who have done this to themselves to the point of wrecking their lives is to change the bankruptcy rules.Report

              • Chip Daniels in reply to Dark Matter
                Ignored
                says:

                They took out loans for an experience without any plans on how to pay for it.

                That’s dysfunctional behavior that deserves to be punished, not encouraged.

                And thus explains why the White House Tweet thread showcasing PPP recipeints was so timely, so perfectly targeted and so effective.

                Look, if you guys want to keep stepping on rakes, Dark Brandon is going to be President forever.Report

              • Dark Matter in reply to Chip Daniels
                Ignored
                says:

                And thus explains why the White House Tweet thread showcasing PPP recipeints was so timely, so perfectly targeted and so effective.

                Not for me. It’s comparing dysfunctional personal behavior to behavior forced on businesses by the gov to fight a pandemic.

                Worse, it’s saying that doing what is right for your family by accepting money from the gov means you’re not ethically able to point out that some other gov policy is a bad idea.

                There may be an emotional kick in there but I don’t care about that.Report

            • Dark Matter in reply to Philip H
              Ignored
              says:

              When we looked up the numbers a bit ago, the numbers available suggest this is mostly a benefit to the non-poor simply because they are the ones with loans. That makes sense if the truly poor don’t go to college in the first place.

              Now there’s an argument that the poor have smaller loans, but I couldn’t find numbers for that.Report

          • Chip Daniels in reply to Saul Degraw
            Ignored
            says:

            Will Rogers had a good line about how if the government gives a poor person a dollar in the morning, by that evening it will end up in the pocket of a rich man, but at least the poor fellow will have enjoyed even briefly.Report

    • Dark Matter in reply to Chip Daniels
      Ignored
      says:

      When it comes to economic policy and education, I don’t really care about hypocrisy. I do what is best for my family, even if that means accepting free money from the government.

      That does NOT mean I think the gov handing out free money to people who don’t need it is a good thing.Report

  5. Slade the Leveller
    Ignored
    says:

    Where did we stand on TARP?Report

    • DensityDuck in reply to Slade the Leveller
      Ignored
      says:

      I think we agreed with Nancy Pelosi that it was a very useful stick to beat political opponents with, and that whether it actually helped anyone was a distant second place.

      I never heard any stories of anyone who was gonna lose their house but kept it due to TARP. I definitely heard stories from people who made more money than me and had more-expensive houses who got letters in the mail saying “due to TARP, your principal has been reduced to current market value”.Report

      • Dark Matter in reply to DensityDuck
        Ignored
        says:

        We had TARP to prevent banks from failing because letting banks fail makes a terrible situation MUCH worse. The politics of bailing out the banks is terrible, the optics is worse, the ethics is even worse, but the alternative was so bad it was pretty much a forced move.

        We prevented a housing/banking/credit crisis from turning into a great depression.Report

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