Facebook Awards $40 Million in Small Business Grants
Covid-19 has been a thorn in the side of a functioning economy for months now. It has driven America into a recession, and most experts agree that the government’s $2.2 trillion stimulus plan is not anywhere near enough to deal with the issues facing America’s economy and its citizens. This is why many large corporations have been stepping up to the plate. In recent news, Facebook announced early on April 3 that they will be giving out $40 million in grants to 10,000 small businesses in the United States that have been affected by the Coronavirus.
$40 million is a lot of money, to be sure; though when it’s divided among 10,000 businesses, that only works out to $4,000 per business, and the businesses need to be chosen by Facebook. So it’s not a lot. It’s a good gesture; Facebook, of their own accord, have decided to help. Though it may not be enough to actually keep businesses afloat during these trying times.
Businesses will have to apply for the grants, and Facebook will choose the winners. While this is a good gesture, it’s being met with a healthy dose of cynicism from many people. As some have pointed out, Facebook is notorious for picking and choosing who gets to use their site, what sort of news it puts out, and whose profiles are promoted. Right or wrong, there is a large vein of truth in these criticisms. Facebook unilaterally dismisses their political opposition by often not only outright banning them, but even banning people who are associated with their perceived enemies.
What this means is that many people believe Facebook is going to play favorites with businesses, allowing businesses that might be a little closer to Team Trump on the politi-meter to fend for themselves, while money is thrown at businesses that meet the corporation’s agenda.
Of course, this is all just speculation from people who don’t necessarily approve of Facebook. In reality, Facebook is under no obligation to give money to anyone, and the fact that they’re offering $4,000 for 10,000 businesses is a good thing for those chosen businesses. It could very much make the difference between keeping the lights on or having to shutter.
A Scary Economic Reality
One thing that’s very scary when viewing raw data for America’s economy is that there are 30 million small businesses in the nation. To give each one $4,000 would cost a whopping $1.2 trillion, something no corporation in the world could likely afford. This is something government cannot even get away with, as evidenced by Alexandria Ocasio-Cortez’s “corporate welfare” outburst over the small amount of money businesses are getting from the government. The truth is that any of these 30 million businesses run the risk of going bankrupt, and it’s highly unlikely that many multi-billion-dollar corporations decide to follow Facebook’s lead.
According to a Goldman Sachs survey, of 1,500 businesses polled, 96% of them say that they are already struggling due to the Coronavirus. According to Sheryl Sandberg, the COO of Facebook, “Covid-19 has hit small businesses everywhere…through no fault of their own, many [businesses] simply can’t do business,” continuing that it has become so much harder on every business.
The goal here is to help businesses keep their doors open until which time the stimulus money from the government reaches the hands of the people. Hopefully this could provide a jumpstart to the economy that, at the very least, keeps America from dipping farther into a recession.
Those lucky businesses that receive grants from Facebook could be saved. Though the corporation is also looking at giving away some ad space and taking other measures that will help even more businesses. The sad truth is that the American economy is far too large, and has too many citizens, to be saved by one entity, even if that entity is government, and even if that entity is a billion-dollar corporation. Large brands like Facebook can put a Band-Aid on the wound, but it doesn’t seal it off.
The best thing that could come from this might not be anything to do directly with the businesses who receive the grant money from Facebook. Instead, the best thing might be if other corporations start following suit and giving away grant money to smaller businesses. If 100 of the nation’s top corporations each gave $4,000 to 10,000 businesses, that’s 1 million small businesses being served. That’s 3% of the nation’s small business.
That would be a great thing, and hopefully Facebook’s grants can inspire others to act.
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