It’s happened again. Media reports about a large, iconic business receiving money from the Payroll Protection Program (PPP). The first PPP fund of $350 million was supposed to sustain small businesses during the pandemic. This time the unintended recipient was the small business that employs LeBron James, the LA Lakers. The basketball team's estimated value is $4.4 billion. King James's salary is $38 million.
Similar to other embarrassed, high-profile brands, the Lakers organization has returned the loan. Some 200 publicly traded companies applied for PPP funds.
That’s not enough for some, though. As Treasury Secretary Steve Mnuchin said this morning on CNBC's “Squawk Box.”
“I’m not a big fan of the fact that they took a $4.6 million” loan, Mnuchin said. “I think that’s outrageous.”
Mnuchin could have added more questions:
- How could the Lakers, in good conscience, apply for such a loan?
- In addition, how could legislators craft the PPP assistance program in a way that allows prosperous companies to be eligible for funds?
Second PPP Pot Boils Over
The news about the Lakers hits as the second pot of PPP funding hit the streets. Well, not exactly. The first load of PPP funding ($350 million) dried up so quickly that Congress appropriated a second tranche, of $310 million. It became available yesterday, at 10:30am ET. That release was a disaster, according to NBC News business reporters Stephanie Ruhle and Ben Popkin.
Implication for Communicators
For communicators, a question in all this is whether or not large brands caught with their hand in the small-business cookie jar will take a long-term reputation and/or financial hit. Perhaps the federal government will take the hit for creating a program that allowed large brands to crowd out small businesses, its intended recipients?
This is one of the questions we’d like you, our readers, to weigh in on as part of PRNEWS’ brief, 6-question poll. We’ll report the results here and on our social channels Thursday.
Thank you for participating. Look for the results Thursday and stay safe.
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