More than 100 senior US executives at companies ranging from Alphabet to Walmart and Facebook have urged Congress to agree more support for small businesses, as concerns mount at the political deadlock on a fresh round of economic stimulus.
The letter, organised by Starbucks founder Howard Schultz, comes as congressional leaders remain locked in negotiations with the White House about new support for those hit by the pandemic fallout after enhanced unemployment benefits ran out last week.
More than 25m Americans have filed for unemployment insurance since Covid-19 began spreading across the US and the withdrawal of benefits threatens to leave millions of families without a safety net and, economists have warned, could hamper both US and global economic recovery.
An extra $600 a week in federal benefits was introduced in March as part of the $2tn Cares Act but lawmakers have failed to reach a deal on extending the support. The White House is said to be considering what the president might be able to do on his own, via executive order, if Congress is unable to cut a deal.
While lawmakers agree on the need for another round of means-tested direct payments to Americans of up to $1,200 apiece, they are at odds over an unemployment benefit extension, as well as legal protections that would prevent employers from being held liable for workers who get infected on the job.
Democrats want the unemployment top-up to continue through next year, while Republicans have argued that too many Americans are now earning more from benefits than they were at work. Republicans, namely Senate majority leader Mitch McConnell, have led the charge on so-called “liability shields” for companies, schools and charities, while Democrats have pushed for more legal protections for workers.
Mr McConnell was set to meet again on Capitol Hill on Monday with Nancy Pelosi, the Democratic speaker of the House, Mark Meadows, the White House chief of staff, and Steven Mnuchin, US Treasury secretary. The leaders held crunch talks at the weekend, but Mr Meadows said on Sunday that there was still a “long ways to go”.
In the chief executives’ letter, sent on Monday, the US executives endorsed proposals put forward by Todd Young, a Republican senator from Indiana, and Michael Bennet, a Democratic senator from Colorado, that would provide low-interest, partially forgivable loans for small and medium-sized businesses damaged by the coronavirus crisis. The so-called Restart Act would build on the Paycheck Protection Program, the $520bn small business loan scheme that was introduced earlier this year.
The PPP has been widely criticised after government disclosures last month revealed that luxury fashion companies, law firms, venture capitalists and Washington lobbyists were among the scheme’s beneficiaries. Small businesses have also called for a loosening of restrictions for PPP loan forgiveness.
The letter’s signatories include chief executives of large companies, including Alphabet and Walmart, several executives from the struggling hospitality industry and many who have sat out other letter-writing campaigns, such as Facebook chief operating officer Sheryl Sandberg.
The intervention is likely to pile the pressure on Congress from a business community that has grown more concerned about the outlook for the US economy as infection rates climb.
The Business Roundtable, one of the leading lobby groups in Washington, called last week for the next phase of stimulus legislation to include targeted aid for the hardest-hit individuals, while pitching unemployment benefits at a level to encourage a return to work and limiting companies’ liability if sued by individuals who contract Covid-19 on their premises.
Mr Schultz has had only an emeritus role at Starbucks since 2018. He explored a run for the presidency as a “centrist independent” but abandoned his campaign in September last year, saying he feared splitting the Democratic vote and handing Donald Trump another four-year term.