In the Wake of Omicron, More Federal Aid for Restaurants Is Unlikely
Many restaurants spent the final weeks of 2021 — when, in ordinary times, they’d be raking in profits from big holiday dinners and hungry tourists — doing the responsible thing instead: closing their dining rooms and giving staff time to take COVID tests as the omicron wave spread like an uncontrollable fire across the country. Around the same time that restaurants and their workers were facing the onset of the largest national COVID spike yet, it was becoming increasingly unlikely, according to new reporting by the Washington Post, that they would receive financial relief from the federal government.
Mid-December talks led by Sen. Ben Cardin (D-Maryland) and Sen. Roger Wicker (R-Mississippi) outlined a $68 billion proposal that would, according to four people interviewed by the Washington Post, tap unspent cash from previous relief packages as well as new funding. If all went well, that money would go toward businesses such as restaurants, gyms, and performance spaces, which continue to face the harshest circumstances during the pandemic. But those talks have failed to move forward. According to CNN, there was no buy-in from Senate leadership, and a House leadership aid who spoke to the network said the talks were “in extremely early stages.”
Although restaurants are once again in a COVID-fueled cycle of openings and closings, the associated government aid that helped many of those restaurants survive the first and second legs of the pandemic has dried up. In March 2021, the $1.9 billion American Rescue Plan stimulus package included a $28.6 billion Restaurant Revitalization Fund. Earlier support came in the form of Paycheck Protection Program loans, which put restaurants in the difficult position of having to keep a large portion of staff on payroll if they wanted their loans to be forgiven. Those loans, which did not specifically target small businesses, ran out quickly, and left restaurants that did receive them unsure of whether or not it would be ill advised to actually use their loan, for fear it might not be forgiven.
Though the Restaurant Revitalization Fund more neatly focused on the needs of small businesses, the cash was drained quickly, leaving thousands of restaurants to fend for themselves. Now, as many of those same restaurants struggle through another COVID-riddled winter, it looks like more money is unlikely to come anytime soon.
A senior Biden administration official speaking to CNN all but shut down the prospect of any immediate plans for another major stimulus package. The official invoked the idea that financial aid encourages laziness and disincentives people from working, saying, “we are not going to write checks to incentivize people to sit at home, and we are not going to bail out businesses if the economy seems strong.” But this idea has received pushback from actual workers, and ignores the risks people who can’t work from home incur when they are immunocompromised, do not have access to healthcare, or must return home to multigenerational households.
The senior official also told CNN that, with the exception of “something small for restaurants,” the Biden administration isn’t looking to provide financial aid when “the economy is booming, there are millions of open jobs, and we do not believe people should be sitting at home if they are vaccinated and boosted, as most adults are.”
When the Restaurant Revitalization Fund’s portal closed on June 30, 2021, it was only able to meet the needs of less than a third of the 370,000 applicants. If that’s any indicator of the sort of support restaurants and their workers need right now, “something small for restaurants” isn’t going to cut it.
