When banks got done making their first batch of loans under the Paycheck Protection Program, the results looked like a quiet “red state bailout,” as the Atlantic’s David Frum put it. The quickly depleted funds had disproportionately aided smaller, more rural states in the middle of the country that just happened to have voted for Donald Trump in 2016—to the relative neglect of blue states that had been hit harder by the coronavirus pandemic.
PPP’s second stage, however, is shaping up differently. As the Economic Innovation Group points out in a new analysis, large coastal states that were shortchanged during the first wave of lending are pulling in a much larger share of the money this time. During the first go, businesses in California received just 9.8 percent of all dollars. During the second, they’ve gotten 19.1 percent. New York went from 5.9 percent to 10 percent of the program, while New Jersey jumped from 2.8 percent to 4.3.
Read Full Article »