Illustration: Aïda Amer/Axios

While large businesses can generally borrow the money they need to get through the crisis, small businesses cannot.

Why it matters: Small businesses are the main engine of employment growth and account for roughly half of all private-sector jobs. If they fail en masse, the whole U.S. economy will collapse.

By the numbers: As Axios' Dion Rabouin has reported, America's largest companies have borrowed more than $1 trillion so far this year, with seemingly no limit on how much more they can borrow if they need it.

  • The Federal Reserve has ensured that nearly all companies with access to capital markets can borrow as much money as they need, with confidence that they will continue to be able to borrow and refinance as those debts become due.

The catch: Small businesses, by contrast, cannot borrow what they need. They're far too small to be able to access capital markets, and banks don't want to lend to them either.

  • Small businesses are notoriously bad credits even at the best of times, which means that meager potential profits on a small-business loan don't make up for the risk the bank is taking.

The only help for small businesses so far has come from the Paycheck Protection Program (PPP), which, as its name implies, was designed primarily to protect employees' paychecks.

  • Be smart: Think of the PPP as a way for the federal government to subsidize employment — it funnels cash through employers as an alternative to paying out $600 per week in unemployment checks. The PPP is good for small-business employees but provides much less help than is needed for business owners.

Driving the news: There's no private-sector solution to this problem. While a bipartisan Senate proposal to support small businesses directly does exist, Sen. Chuck Grassley told reporters this week that negotiations over further coronavirus relief won’t start in earnest until the end of June, and Sen. Roy Blunt said passing another relief bill by July is “optimistic.”

The bottom line: Without substantial direct support from the government, millions of small businesses will never be able to find the cash they need to survive this crisis.

Go deeper

Rand Paul: Republicans should apologize to Obama for complaining about spending

Sen. Rand Paul (R-Ky.) tore into his fellow Republicans on Fox News Wednesday for considering a coronavirus relief package that could cost more than $1 trillion, calling on them to apologize to President Obama "for complaining that he was spending and borrowing too much" during his time in office.

Why it matters: Paul's comments, while tongue-in-cheek, underscore the divisions within the Senate Republican conference, where as many as 20 GOP senators are likely to vote against any coronavirus relief bill — even if a deal is reached between Democrats and Trump administration.

Pelosi on state of coronavirus stimulus talks: "It's a chasm"

Democrats and the Trump administration remain "miles apart" on negotiations over a coronavirus stimulus deal, House Speaker Nancy Pelosi (D-Calif.) said on Wednesday.

Driving the news, via Axios' Dion Rabouin: Congress' failure to renew enhanced unemployment measures for millions of Americans at the end of July is already affecting consumer spending patterns, holding down retail purchases and foot traffic, economists at Deutsche Bank say.

Updated 26 mins ago - Politics & Policy

Coronavirus dashboard

Illustration: Annelise Capossela/Axios

  1. Global: Total confirmed cases as of noon ET: 20,391,697 — Total deaths: 744,211— Total recoveries: 12,625,076Map.
  2. U.S.: Total confirmed cases as of 11:30 a.m. ET: 5,161,612 — Total deaths: 164,690 — Total recoveries: 1,714,960 — Total tests: 63,252,257Map.
  3. Business: U.S. already feeling effects of ending unemployment benefits — U.S. producer prices rose last month by the most since October 2018.
  4. Public health: America is flying blind on its coronavirus response.
  5. Education: Gallup: America's confidence in public school system jumps to highest level since 2004.
  6. World: Lebanon reports coronavirus record, UN warns Beirut blast may drive cases higher