Hello Readers,
The State of New Jersey has announced that smaller business will get help due to the pandemic for the fourth time. This is really good. They have received about $84 million from the federal government, out of which about $5 million has been allocated for management expenses, and about $970,000 for website management. The $84 million distribution is like this: Restaurants: $35 million, Child Care Providers: $10 million, Micro Business under 5 employees: $25 million, Other small businesses: $15 million. Out of the above grant, the state has received 5% that will go towards administrative costs.
There are some stipulations or conditions; The business must have been in operation on February 20, 2020. The Award size will be: under 5 employees $10,000, between 6-25 employees $15,000 and between 26-50 employees $20,000. The awards will be according to their EIN (Employer Identification Number). If the company has more than one location, only one EIN will receive the maximum grant according to the size of their business. The above numbers are for the maximum grant one can receive. If they have received money in phase 1, 2 and 3 it will be deducted from the total award. So, if they have received $10,000 before for 10 employees, they will receive another $5,000.
The plan is exceptionally good. However, the cost of the administration is too high, and they have included medium size businesses as well. So, someone must watch that there will not be awards given to friends and family. The government helped a lot of smaller businesses; otherwise, many of them would have been out of business by now. Still, some of the cases I heard is not good.
As I’ve heard, out of $2.3 trillion in stimulus money, only 9% has gone to the real needy as per the news on the radio. One diner in Jersey City has received $800,000 as a grant with the condition that they must spend the money before 2025. Many taxi drivers and Uber drivers have received about $50,000 to $80,000 as stated by one accountant. The majority of the money should go to the real needy, but in this instance, the majority has gone to the people with the best connections.
Now to the item mentioned on the front page. President Joe Biden has proposed a $6 trillion budget. In 2013, Obama proposed a budget for $3.8trillion, 2014 budget: $3.77 trillion, for 2015: $3.9 trillion, for 2016: $3.999 trillion, For 2017, Trump proposed $4.147 trillion, 2018: $4.094 trillion, 2019: $4.448 trillion, and 2020: $4.451 trillion.
As for the US national debt: it was $16.7 trillion on September 30, 2013, in 2014, it was $17.8 trillion, 2015: $18.1 trillion, 2016: $19.5 trillion, 2017: $19.9 trillion, 2018: $21.5 trillion, 2019: $22.7 trillion, 2020: $26.9 trillion. The rise in 2020 is due to stimulus packages given to all of us.
Due to the high debt, we have not raised interest rates. Out of $21 trillion in debt, it breaks down like this: Federal Reserve $10.8 trillion, Mutual Funds $3.5 trillion, Pension Funds and state and local governments $1.09 trillion, China $1.06 trillion, and the rest by insurance companies and individuals.
With the way we have started to spend money, inflation is right around the corner. We must control our national debt for the future of our children.
Have a wonderful week.
I’ll talk to you next week.
