by Mitch Kokai
Senior Political Analyst, John Locke Foundation
If one were to consider the upward transfer of wealth and market share to Big Business since the start of the COVID-19 pandemic, one would think such economic changes were intended. After all, it’s no secret that the interests of politicians and the corporate elite align more often than not.
As we near a year of lockdowns and sheltering in place, the long-term effects of pandemic policy on the economy are becoming clearer. Almost every piece of legislation ostensibly designed to curb the spread of the coronavirus and protect workers has wreaked devastation on small businesses—while benefiting the largest corporations. Roughly 100,000 small businesses have permanently closed due to COVID-19, while big-box retailers, tech giants, and pharmaceutical manufacturers have seen record profits.
America’s small businesses currently face an attack on all fronts. First, there are the more visible policies (e.g., lockdowns, mask mandates, and social distancing requirements) that strongly discourage people from patronizing brick-and-mortar retailers and restaurants. These policies impact small businesses more than large chains and corporations. Small retailers, for example, may not have the space to effectively implement social distancing policies, and often lack an online infrastructure to support curbside pickups of retail goods.
Second, the cost of complying with health and safety guidelines, and the corresponding fines if businesses don’t comply, have forced businesses to incur additional expenses while their revenue declines. According to the Small Business Administration, the cost of compliance disproportionately impacts small businesses, who lack the funds and infrastructure of large corporations to adapt to new regulation. Overhauling a business to accommodate remote work, for example, requires a flexibility and an investment of resources that many small businesses simply do not have. For dine-in restaurants, the vast majority of which are small businesses, switching to outdoor dining is often not even possible given the business’s location.