The Lakers got some free money, but they’re here to say, turns out, we want other people to have this money. After the Lakers applied for and received $4.6 million from a program meant to help small businesses survive the coronavirus pandemic, the NBA team have decided to return the money to the federal government. Why? Well, apparently, they noticed that the $349 billion pool was quickly depleted, leaving small businesses that really needed the money, without aid.
The NBA season may be suspended, but the league’s chances of insolvency are about as good as the Cavs’ chances of making the Finals. In other words, the Lakers aren’t in any real danger unlike, say, AMC Theaters. And even setting that fact aside, $4.6 million is negligible to the team, just 12 percent of LeBron James‘s salary this season and 0.1 percent of the value of the franchise, the NBA’s most valuable.
Still, it’s understandable why they applied in the first place. When there’s money to be had for basically nothing and you’re a capitalist enterprise operating with a profit motive, you go get that money. Rinse and repeat.
But whether it’s out of a genuine sense of altruism, shame, ora calculus that the PR hit could cost more than $4.6 million, the Lakers decided to return the money. Shake Shack, Potbelly, and Ruth’s Chris Steakhouse found themselves in similar situations, and all three made the same decision.
“The Lakers qualified for and received a loan under the Payroll Protection Program,” the Lakers said in a statement to ESPN. “Once we found out the funds from the program had been depleted, we repaid the loan so that financial support would be directed to those most in need. The Lakers remain completely committed to supporting both our employees and our community.”
Congress did allocate funds for a second round of PPP funding, and the Small Business Administration, which administers the program, is discouraging wealthy businesses with access to other funding sources from applying. They’re still technically eligible, however, so there’s still a need to hope that other large businesses will, like the Lakers did, do the right thing.