Kudlow leaves door open to more small business funding
White House economic adviser Larry Kudlow on Tuesday left open the possibility that the administration would seek more money to fund government-backed small business loans amid surging demand for the $350 billion that Congress allocated in last month's rescue package.
In an interview with POLITICO's Ben White, Kudlow defended the rollout of the "Paycheck Protection Program," which has been plagued with problems since the enactment of the $2 trillion economic rescue law, which is intended to alleviate the devastation of the coronavirus pandemic.
Banks, which are responsible for issuing the loans, have complained that the administration didn't give them adequate guidance on how to launch the program by last Friday's deadline and that the Small Business Administration system for processing applications has malfunctioned. The loans are designed to discourage layoffs and can be forgiven if businesses maintain their payrolls.
While banks have said they have been unable to send money to small business borrowers amid the chaos, Kudlow said there were "$50 billion in loan commitments" and 178,000 loans being processed.
"If the demand is that high, which I would regard as a good thing because we just want to get folks through this tough period, why not ask for more money?" he said.
The Treasury Department late Monday released new guidance in response to mounting questions from banks about how to issue the loans.
The situation surrounding the small business rescue underscores the confusion coming from Washington about how to protect Americans during the outbreak and shore up an economy that has been forced to go into lockdown and shed millions of jobs.
On another matter, Kudlow said he was unaware that White House trade adviser Peter Navarro had warned administration officials in January about the devastating toll that the coronavirus could have on the country, when asked about a New York Times report published Monday.
Kudlow said "there were always a lot of voices out there" but that he was in the dark.
"I never saw the memo," he said.
Kudlow, a self-described optimist, said he hoped the economy will be able to reopen "in the next four to eight weeks."
