Pandemic Impact on Ethnic America: ‘Mom and Pop’ Businesses Left Out of Federal Stimulus Package
By SUNITA SOHRABJI/EMS Contributor
SAN FRANCISCO, Calif. — The mom and pop small businesses of Main Street America largely did not receive funding from the $2.6 trillion CARES Act, conceded Rep. Ro Khanna, D-Calif., at a briefing April 17.
California State Assemblymember David Chiu (left) and California Congressman Ro Khanna (right)
Khanna and California state Assembly member David Chiu led a weekly briefing organized by Ethnic Media Services on the economic impact of the COVID-19 pandemic on ethnic communities. Dr. Tung Nguyen, an infectious disease specialist at the University of California San Francisco, gave an update on the spread of the coronavirus throughout the U.S.
Virginia Hendrick, Executive Director of the California Consortium for Urban Indian Health, discussed the impact of the pandemic on Native Americans who are especially vulnerable to dying from the infection. Genoveva Islas, Founder and CEO of Cultiva La Salud, spoke about the pandemic’s impact on California’s Central Valley, which produces one-fourth of the nation’s table food.
“Banks had discretion about who they wanted to process and if you were a mom and pop restaurateur or a mom-and-pop dry cleaner and you didn’t have any prior relationship with a banker, then you were going to have a very hard time getting those loans,” said Khanna at the briefing.
The first stimulus package allotted $350 billion to the Small Business Administration last month to dole out to small businesses who are reeling from the economic hit of the COVID-19 pandemic and resulting shelter-in-place orders. The funds for the program ran out approximately 14 days after it began, with more than 1.6 million loans approved. The loans were offered to small businesses to help them meet payroll for up to eight weeks and other expenditures.
The SBA had defined small businesses as those with fewer than 500 employees. Khanna said many such businesses are backed by wealthy venture capitalists and should have been ineligible for the loans.
Congress is currently debating a fourth stimulus package — CARES 2 — which would include $250 billion in loans for the paycheck protection program for small businesses. House Speaker Nancy Pelosi, D-Calif., and Senate Minority Leader Chuck Schumer, D-New York, have fought for oversight in the loans process to ensure that the program helps minority businesses. Both Democratic leaders have pushed for more funding to go through community banks, and to reach those who are unbankable.
“We need to have more checks on the SBA program to make sure that banks are setting it aside for the people and businesses that
need it the most,” said Khanna.
The CARES 2 Act would include $75 billion for hospitals, $50 billion for the Economic Injury Disaster Loan program and $25 billion for expanded COVID-19 testing.
Chiu, who represents portions of San Francisco, proposed a state stimulus package during the briefing, noting that California small business owners “have just been hammered.”
SBA data from 2018 show that small businesses in California employ almost half of the state’s labor force. Businesses with under 100 employees have the largest share of small business employment. “Immigrant communities have been the founders of a lot of these small businesses but can’t access capital in the way that others can,” Chiu said.
Chiu also discussed California Governor Gavin Newsom’s $125 million stimulus plan to aid undocumented workers. Nearly one in 10 workers in the state is undocumented, according to data from the Public Policy Institute of California.
Chiu told reporters on the call that a new pandemic unemployment plan would be up and running in about two weeks, to aid non-traditional workers in the “gig economy,” contract workers who currently make up about a third of the state’s labor force.
The assembly member led the fight for a moratorium on evictions of renters amid the pandemic. Chiu, who is chairman of the Assembly’s Housing and Community Development Committee, noted that the state also has in place relief efforts for estimated 150,000 homeless residents.
The U.S. currently has more than 670,000 recorded infections and more than 34,000 deaths. This represents one out of every three infections and 22 percent of deaths worldwide, said Nguyen, who advocated for greater testing capacity and “contact tracking” to identify people with whom an infected person has made contact.
On the treatment front, Nguyen said that a study treating COVID-19 positive people with a high dose of hydroxychloroquine had to be stopped because of an increased number of deaths. The Trump Administration has touted the drug as a possible cure and earlier this month coerced India into providing the U.S. with a large supply of the drug, which is normally used to treat malaria.
“There are lots of products out there that claim to prevent or treat Covid. But I do think that we need to continue to stress over and over again that there are no proven substances or drugs to prevent or treat Covid,” stated Nguyen, cautioning people against giving out their social security or Medicare numbers to those who claim to have cures.
Islas said there has been a consistent shortage of health care providers in the Central Valley even before the Covid-19 crisis emerged. “Our rural
communities would be really challenged to respond to caring for individuals who become sick,” she noted. High rates of diabetes and obesity, along with poor air quality make residents of the Central Valley especially vulnerable to becoming ill from a COVID-19 infection.
Hendrick, who is a member of the Yurok Tribe of Northern California said that Native Americans are dying at three times the national average for underlying illnesses such as diabetes and seasonal flu. “We are an incredibly vulnerable population,” she said.
