Equity! Is there anything it can’t do?

The Small Business Administration, which  administered the Wuhan virus assistance Paycheck Protection Program, now says it will not pursue collection on loans that are  in default as long as the amount owed is $100,000 or less. In fact, most of the 12 million loans given out in 2020 and 2021 were under $100,000.

Hey, free money! Is this a great country or what? May we be so bold as to ask why this largess is being offered to deadbeat businesses?

The SBA claims that the decision to forego collections will ensure “equitable” treatment of  smaller sole proprietor borrowers and larger incorporated borrowers. The SBA reasons that if they pursued collections, the individuals associated with the generally larger incorporated borrowers would hide behind their corporate shield, while individual sole proprietors would be on the hook—-for the money they accepted with a promise to pay it back. Can’t have that! Right? If it’s theoretically possible for rich individuals to duck the loan obligation by having their business declare bankruptcy, it’s unfair to make smaller deadbeats pay back the money they owe. Equity!

The SBA’s Inspector General is not impressed with this logic (he must be a Trump hire), and reported in part,

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