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Higher unemployment benefits undercut small businesses’ ability to retain employees.

By Thomas Gallatin, Patriot Post, Apr. 24, 2020

One of the most common occurrences when Congress rushes to fix a problem is that there are unintended or unforeseen consequences created by the “solution.” In fact, the bigger the “fix,” the greater the probability for it creating more problems than it solves. Congress’s recent $2.2 trillion CARES Act provides yet another classic case reinforcing this principle.

The Paycheck Protection Program (PPP), a part of the CARES Act that provides forgivable loans to “small” businesses to help them stay afloat and retain their employees throughout the China Virus-induced economic shutdown, has been undercut by other provisions within the overall legislation.

For example, “The Cares Act created a perverse incentive not to work,” write Rep. Chip Roy (R-TX) and Emily Williams Knight, CEO of the Texas Restaurant Association. ….

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