By Caitlin MacNeal and Neil Gordon | 6 August 2020
PROJECT ON GOVERNMENT OVERSIGHT — Corruption is sometimes just an isolated scandal. But the coronavirus pandemic and the government’s response are illustrating just how corrupt the functioning of our government has become — and just how high the stakes are. Unfair advantages that the well-connected and wealthy have accumulated over decades produced a system that gives the “have-mores” even more in the middle of a global health crisis.
In this weekly newsletter, we’ll dive into how corruption and its side-effects are playing out in the crisis. We won’t be looking only at bribery and other criminal misdeeds, but also at the many, less obvious — and often legal — forms of corruption that are so deeply ingrained in Washington. This systemic corruption fuels ineffectiveness in government and inequity in society. It makes government prone to fraud, waste, cronyism, discrimination, misinformation, secrecy, and the silencing of dissent.
The Not-So-Subtle Corruption of the Small Business Loans
Dialing in remotely to a congressional hearing last month, Lockheed Martin executive Greg Ulmer sat alone with the company’s logo behind him, awaiting a grueling line of questioning on the defense contractor’s troubled F-35 fighter jet. A couple hours in, Ulmer appeared at a loss for words when Representative Katie Porter (D-CA) grilled him on the company’s request for federal coronavirus aid and noted that Lockheed Martin had been called a “pandemic star” for exceeding profit expectations. Ulmer told Porter that the company has experienced “disruption” and wants to protect its workers, before ultimately seeming to allow the possibility that Lockheed Martin asked for money because other defense companies did, too.
Of course, bailouts for thriving defense contractors are only one piece of the corruption puzzle. Big companies that accepted loans meant for small businesses haven’t had to face this kind of public interrogation. They simply took the money and walked away.
The Paycheck Protection Program — intended to rescue struggling small businesses — is a glaring example of how corrupted systems are chugging along amid the pandemic, with precious little oversight to keep them in check.
From the outset, there’s been a steady flow of stories about powerful, wealthy, or undeserving companies and institutions receiving loans through this federal program. Among them: the Los Angeles Lakers, Shake Shack, and Ruth’s Chris Steak House. When the government eventually released data on the largest loans, we saw that those early examples weren’t flukes. […]