By AFP Staff
Critics are already blowing the whistle on a growing scandal over the hundreds of billions of dollar in federal coronavirus aid that the Small Business Administration (SBA) is set to start handing out to businesses and individuals across the United States. The concern is that there is little to no oversight and almost no accounting of who will get what.
On April 13, Associated Press (AP) reported that the $2.2 trillion Care Act signed by President Donald Trump last month will require public disclosure of where some of that money is going, but a sizable portion will not. AP singled out some $350 billion that will be handed out by the SBA in chunks as large as $10 million. The recipients of that money, according to reports, will not be made available to the public so there will be no way of knowing if friends of top officials benefited financially from the program.
Even more concerning is that public disclosure on an even larger amount that the Federal Reserve will be doling will be left up to the discretion of Fed Chairman Jerome Powell as to whether he believes that information should be remain confidential. Only Congress will be allowed to view the details, leaving the public and other watchdog groups out in the cold.
“You can only truly measure the success or failure of programs if you know where the money is going,” said Neil Barofsky, the former inspector general of the bailout in the 2007 financial crisis. “As a matter of basic governance, there should be disclosure of recipients of government bailout money.”
As part of the legislation, the Care Act does require a special inspector general, a congressional review commission, and a Pandemic Response Accountability Committee to oversee the aid handouts, but there are concerns that political maneuvering on the part of Democrats and Republicans is softening their powers and independence.
Watchdogs are already pushing back on the lack of transparency when it comes to the aid. To this day, no on really knows for sure where all of the money went that was handed out following the collapse of the U.S. economy in 2007. Tens of billions of dollars remain unaccounted for, all of which went to massive financial institutions—the very entities that were behind the economic downturn due to their risky investment schemes, which netted them huge profits until the whole system came crashing down.
AP specifically cited parts of the Care Act that require no disclosures, to wit: “There are no such requirements, for example, for the $100 billion destined for healthcare providers, or the $3.5 billion for companies developing diagnostics, medications, and vaccines, or the $10 billion supposed to go to airports.”
Jordan Libowitz of Citizens for Responsibility and Ethics in Washington, a nonprofit watchdog group, who was interviewed by AFP, believes Americans have a right to know who’s getting what.
“Did they have connections? Did they lobby? Knowing who’s getting the money allows outside parties to do their oversight—and that’s something you can’t do without this information,” he said.