In testimony before the Senate Small Business & Entrepreneurship Committee this morning, AAF President Douglas Holtz-Eakin discusses the strengths and weaknesses of the Paycheck Protection Program (PPP) as well as its future.

His central points:

• The $525 billion authorized by the PPP and disbursed by our nation’s banks is perhaps the single most effective policy tool deployed by Congress in response to the economic stresses posed by COVID-19;
• Any weaknesses exposed in the program are far outweighed by its successes, and were Congress to reinstate the PPP without any program changes this would likely be a significant benefit to the economy; and
• Potential PPP reforms include shifting focus to revenue replacement rather than payroll retention, simplified forgiveness, and structural improvements at the Small Business Administration and Treasury.