WASHINGTON – When restaurant industry executives gathered at the White House this month, Tilman J. Fertitta pleaded with President Trump to let his high-end restaurant chains have access to a government loan program intended for small businesses.

Mr Fertitta, the billionaire owner of the restaurant group Landry’s, told Mr Trump it was unfair that he had to lay off 40,000 workers at his 600 restaurants just because they were employed by a bigger company that has was suddenly excluded from the program amid public outrage at the bailout of large corporations. Mr Trump turned to Treasury Secretary Steven Mnuchin, whose rule changes had excluded companies like Landry’s, which owns restaurants like Del Frisco’s Double Eagle Steakhouse and Morton’s Grille, to see if he could do anything. to help.

“I mean, he’s got a unique situation,” Mr. Trump said of Mr. Fertitta, who bought an Atlantic City casino from Trump Entertainment almost a decade ago. “You know, he has a lot of restaurants. “

Mr Mnuchin, observing that the politically charged debate was unfolding with cameras rolling, objected. “We don’t need to have this in front of all our friends over there,” he said.

The Trump administration’s implementation of the biggest economic bailout in American history has become a political responsibility for the president, businesses, banks and Democrats attacking the White House for its handling of a central agenda intended to help keep businesses and workers afloat during virus-induced shutdown.

Funds have flowed into wealthy hoteliers, Los Angeles Lakers and Planned Parenthood affiliates, sending Mr Trump’s advisers to scramble to collect money and tighten program terms. With more than 30 million Americans out of work and economists predicting that thousands of small businesses could shut down for good, problems with the paycheck protection program bode well for Democrats as the election looms large. 2020.

Top Democrats, including alleged party presidential candidate Joseph R. Biden Jr., have used examples of wealthy executives getting money before small businesses through the program as indicative of corporate cronyism .

Last week, the Democratic National Committee and the Democratic States of Swing States held conference calls with reporters and other events highlighting stories of small business owners who were not approved for loans.

In Maine, four small businesses – an animation studio, beauty salon, Pilates gym, cafe, and bookstore – all told their stories of frustrations and failures with the Paycheck Protection Program, spurred by the chairman of the state Democratic Party.

In Georgia, the State party organized a similar appeal, with owners of a cafe and a nanny service both lamenting their inability to secure funding for the program.

In Florida, Tom Perez, chairman of the Democratic National Committee, hosted a virtual event with local business owners and elected officials to argue that the use of PPP was harming the Latin American community. The program’s shortcomings, Perez promised, would become a central part of the committee’s message for the year.

“These are the stories we’re going to tell,” Mr. Perez said. “Stories of Tragedy Among Small Business Owners. Stories of misuse of resources to help Trump and his cronies. The story of a Latino community which is a vital community in this state and in this country. We are going to go everywhere and we are going to make sure that when the time comes for the election people see this. “

The Trump administration hailed the loan program, which was part of legislation passed by Congress with bipartisan support, as a major success. Mr Mnuchin said the loans have been a lifeline that has saved millions of jobs. To date, $ 511 billion in loans have been approved, with an average loan of $ 116,000, according to the Small Business Administration.

Some Republican candidates are running their own ads in support of the effort. Maine Republican Senator Susan Collins, who faces an uphill battle for re-election, has spent nearly $ 500,000 on advertisements that promote his role in the “co-creation” of the program, according to data from Advertising Analytics, an advertising tracking company. And Sen. Mitch McConnell, Republican of Kentucky and Majority Leader, spent $ 175,000 on a ad featuring small business owners and employees describing jobs and businesses that were “saved” by Mr. McConnell’s stimulus efforts.

But left-wing groups have seized on the program’s missteps and are spending heavily to get this message across to voters. Priorities USA, one of the biggest super PACs on the Democratic side, has paid Facebook to promote certain news articles – a tactic known as “boosted news” – that highlight the program’s shortcomings.

A resurrected Priorities advertisement a Fox Business article with the title “Stimulus to help small businesses ravaged by the coronavirus instead of rewarding hedge funds, brokerage houses”. Another highlighted an NBC News investigation of companies with close ties to the Trump administration that have received PPP funding.

Pacronym, a progressive super PAC that focuses on digital advertising, began running a $ 1.5 million advertising campaign in five swing states – Arizona, Michigan, North Carolina, Pennsylvania, and Wisconsin – that focused on small businesses in difficulty.

For each state, the group created a 15-second commercial featuring an overlay of local news shows focused on small businesses left behind, interspersed with numbers from national cable news calling the program into question. . Each ad begins with onscreen text indicating that each state’s “small businesses are in trouble”.

“It is so important to fight the lies and disinformation that the President is going to spit on the economic recovery in quotes and to make sure voters know who is to blame for this economic crisis,” said Tara McGowan, Chief Executive Officer and founder of Pacronym. .

Democrats and allied groups were supported by Navigator Research survey, which is overseen by the leaders of several progressive organizations, which have found a majority of Americans were “very worried” that the loans were going to big corporations and businesses like the Los Angeles Lakers instead of small businesses.

The problem is already happening on the virtual campaign trail. Mr. Biden has increased Mr. Trump’s handling of stimulus money with increasing frequency in television interviews and on social media. This month, Mr Biden vowed that, if elected, he would appoint a new Inspector General to investigate the destination of the stimulus money and return any mischief or “gift of corruption” to the Ministry of Justice. Justice for prosecution.

The Paycheque Protection Program, which offers forgivable loans to cover eight weeks of wages and overhead costs to businesses with 500 or fewer employees, has benefited many small businesses. More than four million loans have been approved and, according to the Federal Reserve’s latest Beige Book report, the program has helped limit layoffs.

But the rollout has not gone smoothly, with technical glitches and delays hampering efforts to send money and millions of dollars in approved loans to large companies, including those that are publicly traded and who have other access to capital.

A report by S&P Global Ratings found that in the program’s first cycle, seven of the 10 states that received the largest loan amounts had the lowest unemployment rates, while eight of the 10 states that received the largest loan amounts. the lowest loans had the highest unemployment rate. rates. California businesses have been the main recipients of loans during the program’s two cycles.

After it became public that large franchises, including Shake Shack and Ruth’s Chris Steak House, were getting loans, Mr Mnuchin warned that companies with access to other capital would have to repay the loans or face liability. criminal for lying about their demands. Last week, amid backlash from Republicans, the Small Business Administration sent letters to Planned Parenthood affiliates ordering them to repay the loan money because they were not supposed to be eligible to apply.

Lawmakers are working on a bipartisan solution to the program that would give businesses more time to use the money, more flexibility on how it can be used, and better protections for the banks that have executed the loans.

The House on Thursday approved a bill that would give businesses more time and flexibility to use the money.

It is not yet clear whether the program will be replenished when it runs out of funds for the second time, but it will most likely continue to put Mr. Trump and the Republicans on the defensive.

Stephen Moore, the conservative economist who is an informal adviser to Mr Trump, said the Republicans made a mistake in designing a program with insufficient transparency in which most loans turn into grants. This made big companies look for free money.

“It was a very stupid and costly decision that led to a lot of taxpayer scams,” Mr. Moore said.