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PaperclipPerfector  2d ago (text post)   8498 thread views

Culture War Roundup for the week of October 14, 2024

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Aside from the egregious, aggressive, absolutely blatant 14th Amendment violation that makes this anti-constitutional, the most glaring thing to me is how incoherent the idea of a "forgivable loan" is. That's not what a loan is. Per Merriam-Webster, a loan is:

an amount of money that is borrowed, often from a bank, and has to be paid back, usually together with an extra amount of money that you have to pay as a charge for borrowing

If you're informing someone up front that you don't expect the money back, you are extending them largesse or patronage, or perhaps you are providing them a fee for service, but you are not offering them a loan. There were many things that were terrible about Covid spending policies, but this might have been the absolute king of them. The PPP "loans" were never really intended to be paid back, they were always a handout to keep things moving and allow businesses to skip out on doing actual commercial transactions. Framing them as "loans" was intended to attach a couple strings, but these were mostly just helicopter money dispersed with the knowledge that there would be a huge amount of outright fraud and even more casual fudging of the program to collect money. Maybe that was a good idea, maybe it wasn't, but these weren't loans in any meaningful sense. Nonetheless, because they were called loans, now everyone that just took a totally normal loan with a totally normal expectation that they would pay it back thinks that PPP loans being treated that way justifies "forgiving" their loans too.

I could see this becoming a more frequent tactic, just calling handouts to fake businesses, affinity groups, and other favored constituents "loans" that are explicitly designed to never be paid. Really, it's a brilliant tactic, because the recipients don't even feel like they're just welfare cases, they feel like they've received a totally valid loan that they have met the terms of. I do wonder if there's an exploitable tax loophole here - no direct payments for me, thanks, I'll just take the money as a loan with no required payments until June of 2250.

Maybe the loans could be structured such that, while there's no serious obligation to pay it back, if you do, then...something happens. Not sure what, but that could make such a loan more than just helicopter money.

I do wonder if there's an exploitable tax loophole here - no direct payments for me, thanks, I'll just take the money as a loan with no required payments until June of 2250.

The IRS has been wise to that sort of thing for a long time and will classify such "loans" as income. If they're not coming from the government of course.

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