Romer: The system lives upstream |

Romer: The system lives upstream

Have you heard the parable about the two friends who were fishing on the bank of a river?

As soon as they sat down, they hear shouts for help from the water. A small child was in the river, so they launched into the water to save them. No sooner did they have the first child safely on shore, then another child floated downstream struggling to keep her head above the water. The pair of friends leapt back into the river to save this child, too.

In short order they had the second child on shore, and, you guessed it, another child in distress was in the water.

At this point, one of the friends stood up and started running up the hill. The other one, who had already started into the water to save the child, said, “where are you going? This kid needs help!”

“I’m going upstream to find out who keeps throwing these kids in the river!”

It’s hard to take our attention away from the problems immediately in front of us. But many of these problems are results of systemic issues — things that are happening upstream and largely out of our immediate field of view. Without addressing the system itself, we will always have drowning kids in our river.

This parable was shared in the context of workforce development from our partners at CareerWise Colorado. The parable applies to other community issues: health care, transportation, and economic relief. The good news is we don’t have to do just one or the other – we need partners focused on both the upstream and downstream aspects of these challenges.

It is within this context that we urge extension of the deadline for the Paycheck Protection Program through December 31, 2021. Our businesses need the upstream support of the federal government as consumer confidence continues to build back and as local groups such as Vail Valley Partnership and Small Business Development Center focus on downstream impacts.

Congress created the PPP through passage of the bipartisan Coronavirus Aid, Relief, and Economic Security Act, and in the past 12 months more than 5 million small businesses received PPP loans. That aid allowed between 1.4 and 3.2 million employees to stay on payroll even when their employers were forced to close their doors.

Despite the breadth of this emergency aid, small businesses continue to struggle, especially minority-owned businesses. Survey data show that 66% of minority-owned small businesses fear permanent closure due to the pandemic compared to 57% of non-minority-owned firms. The same report shows that minorities have a harder time accessing the capital needed to keep their businesses open. More recent data show neighborhoods with a higher concentration of minority-owned businesses are experiencing higher business closure rates (36%) compared to businesses in non-minority communities (22%).

Legislation enacted last December helped target aid to small businesses that need help the most and the American Rescue Plan passed by the U.S. House of Representatives last week goes even further by providing targeted aid for the restaurant industry and for shuttered venues, and by directing outreach and assistance to entrepreneurs in communities where minority-owned businesses are struggling.

All these steps need additional time for them to actually produce the desired result. Extending the PPP deadline through the end of this year will ensure that the segment of small businesses facing the greatest obstacles do not get left behind.

We continue to need the help of Congress to ensure that we can get upstream to help our businesses emerge from the COVID-19 pandemic in a position of strength that bolsters America’s recovery.

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