Big Banks and Fossil Fuel Industry Poised to Get Bailed Out Under Fed's "Main Street" Lending Program
2020-05-05 — wallstreetonparade.com
``We've walked down plenty of Main Streets in America: in West Virginia, downstate and upstate New York, New Hampshire, Connecticut, Florida and in ski towns from coast to coast. We've seen plenty of boutique gift shops, family-owned restaurants and ice cream parlors, hair and nail salons, sole-proprietor bake shops, and locally-owned breweries. What we've never seen on any of these streets is a shop or restaurant with "15,000 employees or up to $5 billion in annual revenue" or one that needed to refinance $200 million in debt. And yet, that describes businesses that will be able to apply for loans under the Fed's "Main Street" Expanded Lending Program that has been approved by both Treasury Secretary Mnuchin and Fed Chair Powell.
You have to ask yourself this: if this was really about helping Main Street, why wouldn't that $750 billion have simply been added to the Paycheck Protection Program (PPP) which is restricted to businesses with 500 or fewer employees -- the Small Business Administration's definition of a small business? The second round of funding to that program by Congress is likely to run out sometime this week. Just under half of all American workers are employed by a small business that has less than 500 workers according to the most recent government data.
"The Federal Reserve today unveiled an expanded `Main Street' business lending program that could allow failing, highly indebted oil and gas companies to borrow money at low rates. In doing so, the Fed heeded a call by U.S. Sen. Ted Cruz (R-Texas) as well as fracking companies to make it easier for oil and gas companies to refinance their debts. The Fed's new program rules drop an earlier restriction on refinances.
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