COVID19 Corruption: Wealthy And Well Connected Get Rich While People Suffer

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Above photo: COVID dollars from Fiscal Times.

While corrupt elected officials and elites feed at the public trough, the economic collapse is hitting people in the United States hard. According to the newly released Bureau of Labor Statistics figures 47.2 percent of working-age people are without work and businesses are finding it impossible to pay their rent or keep their employees. The basic ability to feed children is in crisis, as nearly 14 million children in the United States went hungry in June, an increase of 10 million since 2018, and nearly three times the number of children who went hungry during the Great Recession, according to an analysis of Census data.

Newsweek summarizes:

“Nearly half of U.S. households’ incomes have declined during the pandemic, with survey data showing both low-and high-income households being affected at about the same rate. For the week ending July 4, 1.3 million Americans filed for unemployment benefits. Evictions are expected to skyrocket with 23 million people possibly facing eviction by September. “

The impact of the economic collapse will hit even harder in the week of July 25, when the temporary weekly increase of $600 in unemployment benefits enacted in the CARES bill ends.  There is strong opposition in Congress and the White House to continuing those benefits. The moratorium on evictions from federally subsidized housing will also end that week. The Census Bureau Household Pulse Survey found 30 percent of renters had little or no confidence that they could meet housing payments next month.

Amidst this crisis for most people, the investor class is doing well as the US stock market closed in June with one of the best quarterly rises in history. This is not surprising as the Federal Reserve and Treasury have funneled trillions to the wealthy. Pandemic capitalism is highlighting the wealth divide and the corruption of government working in cahoots with the super-wealthy.

The Rich Got Bailed Out, We Got Sold Out

While the government sought to hide where pandemic bailouts under the Paycheck Protection Program (PPP) were going, it is now being exposed. The PPP loans were intended to help small businesses maintain their payroll with loans that are fully forgiven if at least 60% of it is used on payroll costs. Recipients were kept secret, but public pressure forced them to release the information. The government is only releasing information on grants over $150,000. News agencies have filed suit to release all the information.

The self-dealing and corruption of big donors, members of Congress, the president and their families and friends are being exposed. These people are getting the bailout funds while others without those kinds of connections are suffering. Or, as Esquire mockingly described, the list of recipients  “was stuffed to the gunwales with fatcats, friends of fatcats, deadbeat fatcats, fatcat-financed organizations, and fatcats with political influence.”

Bailout Dollars Go To Elected Officials, Their Families, and Associates

Roll Call reports that $14 million in relief funds wound up going to members of Congress and their families. Businesses owned by lawmakers and their families move to the front of the line for bailouts. “At least nine lawmakers and three congressional caucuses have ties to organizations that took millions of dollars in aid,” Politico reports

The Washington Post reports Elaine Cho, the wife of Majority Leader Mith McConnell (R-KY) received aid, Among some of those receiving relief were Transportation Secretary Elaine Chao’s family’s shipping business. In addition, at least seven members of Congress or their spouses received loans, including lawmakers who were directly involved in shaping regulations and also benefited from a blanket waiver of ethics concerns.”

KTAK Corp., a Tulsa-based operator of fast-food franchises owned by Rep. Kevin Hern (R-Okla.) received between $1 million and $2 million, according to the Post.  Further, Rep. Mike Kelly (R-Pa.) benefited when three of his car dealerships, located outside of Pittsburgh, received a combined total of between $450,000 and $1.05 million. Several plumbing businesses affiliated with Rep. Markwayne Mullin (R-Okla.), all based in Broken Arrow, Okla., each received between $350,000 and $1 million.

The Fiscal Times reports,Among the lawmakers who own or have other ties to businesses that received loans are Republicans Reps. Rick Allen (GA), Vicky Harzler (MO), Kevin Hern (OK), Mike Kelly (PA), Markwayne Mullin (OK) and Roger Williams (TX) as well as Democratic Reps. Matt Cartwright (PA), Susie Lee (NV) and Debbie Mucarsel-Powell (FL). A company tied to the husband of House Speaker Nancy Pelosi (D-CA) got a loan of between $350,000 and $1 million.”

Forbes reports that West Virginia Governor Jim Justice, a coal-mining tycoon, pulled in millions for his businesses. His Greenbrier resort in White Sulphur Springs took a PPP loan ranging from $5 million to $10 million. His Greenbrier Sporting Club, a membership club that touts “luxury living,” infinity pools and more took a loan of $1 million to $2 million in April.

Trump Family, Friends and Business Associates Get Millions

ProPublica reportsBusinesses tied to President Donald Trump’s family and associates stand to receive as much as $21 million in government loans designed to shore up payroll expenses for companies struggling amid the coronavirus pandemic.” This includes a hydroponic lettuce farm backed by Dobald Trump, Jr. the president’s eldest son of at least $150,000.

Further, “several companies connected to the president’s son-in-law and White House adviser, Jared Kushner, could get upward of $6 million.” ProPublica reports on Kushner-related grants, “The New York Observer, the news website that Kushner ran before entering the White House and is still owned by his brother-in-law’s investment firm, was approved for between $350,000 and $1 million, data shows. A company called Princeton Forrestal LLC that is at least 40 percent owned by Kushner family members, according to a 2018 securities filing, was approved for $1 million to $2 million. Esplanade Livingston LLC, whose address is the same as that of the Kushner Companies real estate development business, was approved for $350,000 to $1 million.” They also report that “up to $2 million was approved for the Joseph Kushner Hebrew Academy, a nonprofit religious school in Livingston, N.J., that’s named for Jared Kushner’s grandfather and supported by the family.

It is not just Trump’s family, the Post reports, “At 40 Wall Street, an office building Trump owns in Lower Manhattan, 22 companies received loans, for a combined total of at least $16.6 million.” Similarly, tenants at Trump hotels received millions, e.g., “Triomphe Restaurant Corp, which operates the Jean-Georges restaurant at the Trump International Hotel on Central Park West, got between $2 million and $5 million. Sushi Nakazawa, a restaurant in the Trump D.C. hotel, received between $150,000 and $350,000 to support 22 jobs, according to the data.”

Also, Trump friends and associates such as “Albert Hazzouri, a dentist frequently spotted at Mar-a-Lago, asked for a similar amount. A hospital run by Maria Ryan, a close associate of Trump lawyer and former mayor Rudy Giuliani, requested more than $5 million.”  A Trump lawyer also received millions: “a Manhattan law firm whose marquee attorney has fiercely defended Trump for almost two decades. Kasowitz Benson Torres LLP — whose managing partner, Marc Kasowitz, was at one point the president’s top lawyer in the special counsel’s Russia investigation — was set to receive between $5 million and $10 million from Citibank.”

Trump media allies got PPP funding. Bipartisan Report wrote, “The conservative online media outlet founded by Trump confidante and FOX News host Tucker Carlson, the Daily Caller received as much as $1 million. Carlson sold his stake in the company on June 10. And, Newsmax, the Conservative TV network and website owned by another presidential confidante, Christopher Ruddy, got a loan worth $2 million to $5 million.”

End Socialism For The Rich

Bailout business “socialism” would be something you’d expect libertarians and small government anti-tax advocates to oppose; however, among the recipients of PPP funds was Grover Norquist who wants the government to shrink “to the size where we can drown it in the bathtub.” His organization, Americans for Tax Reform took $350,000. The Ayn Rand Institute, The Center for the Advancement of Objectivism, which advocates  “laissez-faire capitalism,” took $1 million in PPP funds. Its board member, Harry Binswanger, said they would take the money because “the principle here is justice.”

In fact, if the principle was justice, then this kind of hypocrisy and corruption would be stopped and a program to help the vast majority of people who lack economic security, and the small businesses that will be unable to survive the economic collapse would be the recipients of this kind of funding.  This is the second time in a decade that the government has had to bail out capitalism with trillions of dollars. Maybe it is time for economic democracy, an economy that serves the people, not the wealthy.

As Richard Wolff writes, “Capitalism serves capitalists first and foremost.” That’s why recovery from the COVID19 pandemic and the current recession require changing the economic system to one that puts people and the planet over profits. There are efforts to make that a reality by creating worker-owned cooperatives, participatory budgeting and public banks. Some communities are organizing mutual aid including solidarity gardens where the food produced is given to communities in need and there are programs to donate stimulus checks to people without incomes.

If there was ever a time to build a different world, that time is now. Ajamu Baraka explains, “The current ongoing capitalist crisis has created the most serious crisis of legitimacy since the collapse of the capitalist economy during the years referred to as the Great Depression.” He urges us to keep the focus on class and race so we cannot be divided and to have a broad lens to connect what is happening at home to what the US does abroad. We must also recognize how the state will try to coopt and water down our demands. Change is coming. What it looks like is up to us.

Upcoming events:

July 16 – The Embassy Protection Collective hosts the “Strengthening Solidarity between Social Movements in Venezuela and the US” meeting via Zoom at 2:00 pm. Click here for more information.

July 20 – Strike for Black Lives.

  • il corvo

    How about the perk of single payer health care for members of congress? Where were the layoff of government workers in all layers of government including congress? Politicians and their friends get bail-outs while the media keeps the people frightened of a virus that has killed less than the seasonal flu. We, the people, are to be kept frightened as government rolls out more measures to continue implementing a New World Order. Next comes a genetically engineered vaccine, plus world wide 5G and another war or two.

    Oh, don’t forget your mask and keep socially isolating.

  • Nylene13

    Of course Capitalism is the problem.

    The RICH are the problem, but what do we the people do about it?

    Bernie would have been a good start, but trying to work for economic and political change within the RICH controlled system seems hopeless.

    It seems the RICH can’t help themselves. They just love greed and money and power, and hate poor people and the environment.

    They are drug addicts, and their drug is Money.

    Our Environment is Dying. It all just seems hopeless.

  • mmckinley

    Your analogy to drug addiction is a good one, except there seems to be no such thing as a deadly overdose that at least might thin the ranks. Hopeless, indeed. Only one answer: Eat the rich. Capital belongs to the democratic commons.

  • Edward Winslow

    A good start is not good enough. The Democratic Party’s mislabeled “progressives” are more pernicious than the extreme reactionaries that dominate both corporate political parties. The progressives function to stabilize the status quo and keep the abominable system in place. The entire illegal government in Washington DC must be toppled and replaced with a socialist government that ensures political and wealth equality.

  • mmckinley

    Wonderful journalism, Kevin and Margaret. Thank you! I shall share this to many eyeballs.

    If there is one thing the pandemic and economic collapse bring into stark relief, it is the deadliness of the class war we are engaged in right now. It is very real and immediate. Many have died and suffered. Many more will. Our lives are at stake, even our survival as a species. Capitalists can no longer hide their relentless pursuit to own EVERYTHING behind the benign fiction of efficient production, the fiction of producing what people want and need, the fiction of the common good, the public good, the fiction of free markets, the fiction of the sanctity of private ownership, which is monopoly. No, our current crises reveal capitalism for what it is. The purpose of capitalism is to concentrate ownership of wealth, of the planet itself, into fewer and fewer private hands. And it does so through purchase of raw government, corporate power and force. Autocracy is its path. Fraud, terror, piracy, monopoly, slavery, genocide, empire are its proven tools. We the People are its declared enemy. If we refuse to be slaves, or are not needed, we are in the way.

    The cure is democracy. Political and economic democracy. We must unite and take the world back into common and equal ownership, the world that has been stolen from us. The capitalists will never return it willingly, not even a dime, not even a square foot of soil. Ultimately, when we finally see the enormity and deadliness of their theft, those of us left alive must revolt, or join the ranks of the dead. We must declare our independence from the tyranny of monopoly capital.

    We are under attack, and have been for years. It’s time to eat the rich.

  • Nylene13

    I agree.
    I just don’t put Bernie in that category. Bernie – a long time registered Socialist- quit the Socialist Party to run as a Democrat -because he was running to WIN.

    It is easy to say the entire illegal government in Washington DC must be toppled-but just how to do you plan to accomplish this?

    The Rich would not even allow us to elect Bernie!

  • Nylene13

    And how do we eat the rich? How many Socialists are there compared to the Democratic and Republican voters?
    Not even enough to get Bernie elected, it appears.

  • Edward Winslow

    Overthrowing the illegitimate government will not be done in the next fake election. It will take an expansion of the uprising that is already happening in the streets. It will also require additional direct action like general strikes and boycotting, any action that disrupts the capitalist government.

  • RickW

    From Harper’s Weekly Review:
    The Ayn Rand Institute in Santa Ana, California, which promotes “laissez-faire capitalism,” was approved for a Paycheck Protection Program loan from the Trump Administration.

    Just sayin’………..

  • Nylene13

    Well I hope so.
    But I fear that we are out of time.

    Fukushima’s rate of Nuclear Waste pouring into the ocean has INCREASED and scientists have not figured out why- or any way to stop it.

    It has now reached all corners of the Pacific Ocean.

    And that is just one example.

  • mmckinley

    Well of course “Eat the rich” is a metaphor, meant to say that our salvation lies in their destruction, absolutely necessary to take back what they have stolen from us. Yes, Edward Winslow, with a socialist revolution. Please don’t actually eat the rich. Ewwwwwwww. Too much fat.

    So how do we do that? “Ay, there’s the rub,” says Hamlet. He continues: “To sleep, perchance to dream.” We need to envision a new future. First, it means showing the great mass of humanity that, in truth, we are all socialists. That the alternative is the extinction of our species. Bernie was a start at waking people up from our long, long sleep. After forty years, we were ready. BLM and outrage over the pandemic—with their revolutionary calls for defunding the slave patrols, the incarceration complex, and the pentagon—are more good steps. It is essential that, in this moment, we draw the connection to what exactly is at stake, here—nothing less than our very lives. We’re not coming at this from zero. Much has been done already. The people are awakening. Look around you. The revolution is underway. Join the flow, the Tao. Help it grow. It will soon be unstoppable. The details will organically emerge as it builds, they are unpredictable as yet. Be open. Trust. And act.

  • Nylene13

    Well I just ordered a Bread Machine. I had to order it online, they were sold out all over around here in Nevada.

    That is pretty Revolutionary.

    People making their own bread, that is a sign of progress. Don’t have to heat up my stove oven.

    100 Degrees today- And I can’t bake bread outside in my brick oven with a EXTREME FIRE DANGER ORDER IN EFFECT. Thirty thousand acres burned so far.

    People here are also planting gardens. Lots of first time gardeners.

    That is very good.

    I have been making lots of zucchini bread.

    And people staying home is good for the air.

    We must change the way we live.

    What is this just on the news about Russia flying fighter jets over Ireland?
    Now Ireland is talking about buying fighter jets?
    How crazy can things get?

    sigh.

  • Nylene13

    Figures.

  • RickW

    From Harper’s Weekly Review:
    It was reported that South Korea’s largest airline, six hate groups, several law firms representing Trump, a firm owned in part by Nancy Pelosi’s husband, and the U.S. Catholic Church cumulatively received billions in taxpayer-backed coronavirus aid, while only 12 percent of Black and Hispanic business owners who applied for the same forgivable, low-interest loans had received the full amount they had requested.