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$349 Billion Emergency Small Business Lending Program Officially Tapped Out; U.K. Announces Extension To Lockdown Orders; Coronavirus Changes The Path To Higher Education. Aired 12:30-1p ET
Aired April 16, 2020 - 12:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
PHIL MATTINGLY, CNN CONGRESSIONAL CORRESPONDENT: -- through the weekend, into next week. And some of the concerns I'm hearing right now are that it could go even longer than that unless some type of breakthrough occur soon.
And I think one final point to make here, what this program actually is. In the midst of a month where 22 million Americans filed for unemployment benefits, this loan program is forgivable loans backed by the Small Business Administration that allows small business owners to essentially pay out their employees. It's not a stimulus, if you will. It's essentially a life raft to pay for -- pay your employees salaries, to put -- to pay for payroll, to pay your utilities, to pay mortgage interest, things of that nature, not just a blank check.
If you want your loan forgiven, those would be the things you'd have to do. The idea being that you can keep small business employees employed, even if there's nothing for those companies to do over this period of time. That money is now run dry at a particularly bad time economically. And lawmakers right now at least don't have a path forward, John.
JOHN KING, CNN HOST: Not a path forward at the moment. Phil Mattingly, appreciate that.
Joining me now for more on the business disruption, the business impact, Suzanne Clark is president of the U.S. Chamber of Commerce. Suzanne, it's good to see you.
Let's start what we just left off with Phil Mattingly. The Chamber has considerable sway over members of Congress talks to members of Congress. A lot of your small businesses saying, we need this money, it has now dried up. Is there -- do you see a path here to compromise today so this can be quickly -- the money can be quickly replenished? Or do you have small businesses that might be going bankrupt or at least not pay to pay their employees because of this impasse?
SUZANNE CLARK, PRESIDENT, U.S. CHAMBER OF COMMERCE: We know how important this funding and this assistance is to small businesses. We hear from them and from local chambers across the country every hour of every day. We need Congress, we expect Congress to display the kind of bipartisan cooperation they displayed in getting the CARES Act done because we know that every hour, every day counts for these small businesses in trying to pay their employees and stay afloat.
KING: So I want your best help if you can. We have a conflict brewing. Everybody wants to open the American economy as soon as possible. The President is going to release his guidelines today. He has made clear he thinks this can start on May 1st in much of the country. He believes it can start even before May 1st in parts of the country.
But just moments ago, the Democratic Governor of New York, Andrew Cuomo said this.
(BEGIN VIDEO CLIP)
GOV. ANDREW CUOMO (D-NY): We have to continue doing what we're doing. I'd like to see that infection rate get down even more. The New York pause policies, the closed down policies will be extended in coordination with other states to May 15th.
I don't want to project beyond that period. That's about one month. One month is a long time. People need certainty and clarity so they can plan. I need a coordinated action plan with the other states.
(END VIDEO CLIP)
KING: He talks about that regional cooperation that would be Pennsylvania, New Jersey, Connecticut, Delaware, Massachusetts, Rhode Island, through the middle of May. The City of Los Angeles went through the middle of May yesterday. The District of Columbia says, it will keep in place its provisions in for the middle of May.
What is your sense, A, there's a political disagreement here between the President and some of these governors. But for businesses trying to reopen is this confusion now making it even harder?
CLARK: I think for businesses trying to reopen, they have more questions than answers at this point. And they're trying to use this period to make a plan to be able to anticipate the challenges ahead and be ready when that green light comes. There are all kinds of new processes, new equipment, new training, new restrictions that are going to be put upon businesses that never had to deal with anything like this before, and there is no playbook.
So I think they're waiting for federal guidance and local execution on when and what they could do in the meantime is figure out how,
KING: But it sounds to me like you think it is unrealistic except for in some smaller pockets, smaller businesses, maybe in places that don't have a lot of cases. But for anybody with a significant number employees if you're talking about personal protective equipment, new social distancing in the office or on the factory floor, and all of these other provisions that you think May 1st people are going to simply not going to be ready anyway.
CLARK: I think this conversation misses the point that a lot of people have continued to work this entire time. There are a lot of essential businesses and workers who are currently at it. What can we learn from those businesses in terms of what's worked, what hasn't. There's a big experiment happening right now.
A lot of people who are working, what can we learn from them to be able to expand as quickly as possible? You know, we've had this big public health crisis. Now we have a big economic crisis. We know what a job means to a family, to a community. We know what it means to health outcomes. So the sooner we can get people back to work, the better.
KING: Suzanne Clark, appreciate your time and insights today. It's a very interesting potentially rough few weeks ahead as we tried to sort all this out, very much appreciate your help doing it.
CLARK: Thank you, thank you.
KING: Up next for us, news just coming in from the U.K. about how long their coronavirus lockdown will continue.
KING: Just moments ago, the United Kingdom officially extending its national lockdown because of the coronavirus. CNN chief international correspondent, Clarissa Ward is live in London for us with the details. Clarissa, what happened?
CLARISSA WARD, CNN CHIEF INTERNATIONAL CORRESPONDENT: Well, we heard from Dominic Raab, the foreign secretary who is stepping in for Boris Johnson. He said essentially that while there are indications that these social distancing measures have been effective, that some of the numbers are plateauing, it's still effectively, John, a mixed picture.
And in some places, they are still seeing a spike. So what he said was, there is no way we can start to reduce social restrictions and social distancing and risk the possibility of a second wave until we know that we really are on a proper downward trajectory. He gave five criteria essentially that he said need to be met before these restrictions can be lifted.
Number one, the National Health Service needs to be able to cope and provide critical care to all who would need it. Number two, there needs to be a sustained and consistent fall in the death rates. Number three, there also needs to be a fall in the rate of infection. That's a different criteria from the death rate but an important one nonetheless.
Number four, operationally, testing needs to be ready. They said in coming days, they hope to be testing 100,000 a day, which is something they've been promising for quite some time. And PPE, personal protective equipment, they need to make sure that there is enough for everyone who needs it. Five, they said and this is the most important he highlighted, they need to be sure the government needs to be certain that there's no risk of a secondary peak of another wave that would potentially overwhelm the NHS, the National Health Service.
And also on the economic question, the point he kept making was, if you rush it now, the economic damage of a secondary infection or a second wave will be worse and the social distancing guidelines and restrictions that are in place that many people find so chaffing will have to be extended for an even longer time. So, basically asking, John, for the British people to be patient, John.
KING: That's very much the same debate we're having here in the United States. When is it safe to move forward? Clarissa Ward, for us live outside of 10 Downing, appreciate the important update from the U.K.
Up next, as we just noted, New York extends its stay in place orders and its economic shutdown until the middle of May. Los Angeles is warning no big concerts in the city anytime soon.
KING: Major news out of New York this hour, stay at home measures now left in place until at least May 15th. In Los Angeles, the Mayor Eric Garcetti also said yesterday his city stay in place orders will stay in place just as long through the middle of May. The mayor also says events like sporting, concerts, big crowds, may not return to the city until sometime next year, 2021.
CNN Stephanie Elam is in Los Angeles. Stephanie, that's big news from the mayor. Number one, we're extending in the short term. But number two, you may not see the Lakers with fans until next year. What's the reaction there?
STEPHANIE ELAM, CNN CORRESPONDENT: Yes. That's a difficult one for people to even envision at this point. But the mayor is pointing out, John, that really when you take a look at it, the basis for this is that we need more testing. We've heard this from other municipalities as well, that before there is any reopening or going back to what we knew as normal, that what needs to happen is testing. So we know who has had the virus testing for those antibodies and who may still be susceptible.
Anyone who may be asymptomatic as well, and then being able to track down any cases and shut down an outbreak quickly and then quarantine any other people who may have been near somebody. They also say that they need to have surge hospitals open. I've been inside of the surge hospital here in Los Angeles, one of 11 in the state that has opened up.
And then also they're saying that ongoing research and development, that's that pharmaceutical part of it, finding that vaccine and then getting it to the people, which we know is going to take at least a year to get. He's like, before we get any of that done, it'll be that was what's necessary before we could open up the city.
Now, keep in mind that the peak is still ahead for us. We had two of the largest numbers of deaths here in L.A. County because of COVID-19 because -- in the last two days. So these numbers show us that we're still not there. And he's afraid that if we try to loosen things too quickly, we could see another bigger outbreak. And that's what they don't want to have happen.
And the other part that he spoke to was the fact that this new normal of having masks as of midnight last night. Anytime you go into a store, any essential business that's still open, you've got to have your mask with you. And he's saying that this is the way it's probably going to be here for a while, John.
KING: For the foreseeable future at least. Stephanie Elam in Los Angeles, appreciate that update.
Coming up for us, a closer look at the coronavirus destruction on higher education.
KING: More evidence today of the damage the coronavirus pandemic is doing to the economy. Look at these staggering numbers from the Labor Department today. 5.2 million Americans filed new unemployment claims just last week, just last week. That brings the four week total to a massive 22 million. Here's a visual representation of the economic pain happening across the country.
You see those lines right there? Hundreds of vehicles lining up for more than a mile just outside Houston, those people waiting for hours to pick up free food from a local food bank. Many of the newly unemployed are small business owners.
CNN's Vanessa Yurkevich has a few of their stories.
CHRISTINA MICKENS, OWNER, C. NICOLE PR FIRM: Everything was just prospering and just growing.
KRISTOPHER PAYNE, OWNER, WELL PLAYED GAMES: Everything was actually really good.
ANA CASTILLO, PRESIDENT, SAFE CRUISE PARKING: Business is great.
VANESSA YURKEVICH, CNN BUSINESS AND POLITICS CORRESPONDENT (voice- over): But then for these small business owners, it all came crashing down. Like many businesses around the country. COVID-19 changed everything.
CASTILLO: It was like apocalyptic. It was the scariest day ever.
(voice-over): Americans who are self-employed, gig workers or freelancers can now apply for unemployment.
CASTILLO: Royal Caribbean --
(voice-over): Ana Castillo is one of them. Her family owns a cruise parking lot in Miami, but with no cruises. Her income is zero.
CASTILLO: Me and my parents have put blood, sweat, and tears into not only coming to this country and like building something for themselves, but in general like safe cruise parking was built from their savings from every penny they've ever worked for.
MICKENS: How business works --
(voice-over): Christina Mickens owns a P.R. company in Atlanta. And business is slow. As a single mom to a 9-year-old, she's the family's breadwinner. She hasn't heard back about her unemployment and her rainy day fund is drying up.
MICKENS: Sticking to the bare minimum, I would say by the end of April maybe first two weeks May, that'll be gone.
(voice-over): Kristopher Payne is in the same boat.
PAYNE: And the bills don't stop between now and then, and the money is rapidly running now.
(voice-over): His gaming shop in North Carolina is a month away from shutting down.
PAYNE: I applied for the PPP, the idle loan, the grant, and I've also applied for unemployment. Nothing has worked out at this point.
(voice-over): With the backup in unemployment processing, Payne believes he's weeks away from a check.
PAYNE: If the unemployment came through, I would be able to turn all of that money in to, you know, money that I would use for my business.
(voice-over): Forty-three percent of small business owners say they have less than six months until, though, closed because of COVID-19, according to a survey by the U.S. Chamber of Commerce. For some, the pure will to survive could be enough.
MICKENS: Failing is not something that's in my radar or even in the back of my mind when it comes to my business because I know, I won't be that 40 to 50 percent.
(voice-over): For others, the wound may be too deep.
CASTILLO: It's not just like the business. It's like the people behind it and everything that they do to provide a service to you and to make a living for themselves. So I would just say support your local businesses.
(voice-over): Vanessa Yurkevich, CNN, New York.
KING: Painful, painful to hear those stories. The path to higher education is taking a coronavirus detour. The pandemic emptied assembly halls, classrooms, and campuses. And now, just like businesses, colleges and universities are forced to reimagine the future.
CNN correspondent, Evan McMorris-Santoro is taking a closer look for us. Evan?
EVAN MCMORRIS-SANTORO, CNN CORRESPONDENT: Hey, John, how you doing?
So, listen, we learned today that the College Board is talking about preparing for a future where students may take the SAT's online because they can't go back to their classrooms. It's the same problem for colleges. Students all over the country are facing an uncertain future. And that means the institutions are trying to attend next fall, also face an uncertain future.
BARBARA MISTICK, PRESIDENT, NATIONAL ASSN. OF INDEPENDENT COLLEGES & UNIVERSITIES: Most institutions have made a commitment to be closed for the summer semester.
MCMORRIS-SANTORO (voice-over): As the pandemic continues, colleges and universities nationwide are being forced to make hard choices. One of the hardest whether to keep campuses closed this fall. It's a decision that has to be made soon.
MISTICK: Well, I think most institutions need somewhere around a six week to two month runway to understand and be able to be open.
(voice-over): Howard University president, Dr. Wayne Frederick is weighing whether students can safely fill dorms, quads, and classrooms in August.
DR. WAYNE A.I. FREDERICK, PRESIDENT, HOWARD UNIVERSITY: We don't know what social distancing is going to look like then. We don't know how much of a threat, we'll get a second wave in the fall. We all have to be very cautious.
(voice-over): After the worst of the health crisis is over, the challenge for higher education may only be beginning.
MISTICK: For many colleges and universities, not going back in the fall means that they might have employees who are furloughed that might lead to further layoffs in their communities.
(voice-over): The growing financial crisis is creeping into the way students think about their futures. A recent survey of around 30,000 U.S. high school students found more than 80 percent of juniors and seniors since the outbreak were more concerned about paying for college.
FREDERICK: We are being realistic about the fact that continuing students may struggle to come back because their family's economic circumstances may have changed very differently over the next three to four months. UNIDENTIFIED MALE: Another way the President interacts with students is --
(voice-over): All college presidents hope, that campus will open in the fall and that's the collegiate atmosphere will flourish again.
MISTICK: You have athletics and that kind of the spirit that comes with coaches and that connection that people have with their teams. So you have lots of layers of support for students on a residential campus.
(voice-over): Students are hoping not to miss out on the best parts of college.
SARAH FAHMY, UNIVERSITY OF COLORADO BOULDER STUDENT: There's also the social aspects of students and faculty and staff interacting with each former. Human contact is really important. There's a couple of different campus resources that form like a well-rounded human in student activities and in groups and whatnot that students will really be missing out on.
MCMORRIS-SANTORO: So look, all over the country, students are trying to figure out exactly what they can do about their futures. We've seen education institutions they had to scramble and create this online program just in a matter of days as this as student -- institutions shut down, try to figure out what to do if this drags on and on.
We've seen colleges switch to pass fail grading. We've seen high schools do the same thing now because we don't know what happens next. Now we sit here and they have to plan on whether or not they're going to even open the campus in the fall, meaning students who are going to be freshmen next year could be going to college from their living room, John.
KING: That's remarkable. Everything is changing and everything is uncertain. Evan McMorris-Santoro, appreciate that very important look for all the higher education. Thanks for joining us today.
We'll see you back here this time tomorrow. Don't go anywhere, very busy News Day. Anderson Cooper picks up our coverage right now. Have a good afternoon.