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Apr 18, 2020

The cost of COVID-19

Co-produced with PRX Logo

With millions of people unemployed because of the coronavirus, Reveal’s Aaron Glantz looks at how the economic fallout is affecting homeowners and renters – and whether this crisis could end with people losing the very homes they’re forced to isolate themselves in. 

Reveal’s Jonathan Jones takes us inside the hotel industry, where franchise owners are struggling to stay afloat amid staggering revenue losses. 

And we take a tour of the main business strip of White Center, Washington, a longtime immigrant community with little political clout. Reveal’s Emily Harris explores the future of mom-and-pop shops there, already vulnerable before the coronavirus closures. 

Finally, Tina Antolini brings us the story of a chef in New Orleans leveraging what he still has to stay nimble, stay working and help his community. 

Credits

Reported by: Aaron Glantz, Jonathan Jones, Emily Harris and Tina Antolini
Produced by: Katharine Mieszkowski, Najib Aminy and Emily Harris
Edited by: Brett Myers, Jen Chien, Kevin Sullivan and Esther Kaplan
Production manager: Mwende Hinojosa
Production assistance: Amy Mostafa
Sound design: Jim Briggs and Fernando Arruda
Special thanks: Will Evans
Executive producer: Kevin Sullivan
Host: Al Letson

Transcript

Reveal transcripts are produced by a third-party transcription service and may contain errors. Please be aware that the official record for Reveal's radio stories is the audio.
Al Letson: Before we get started today, I just want to acknowledge what a tough time this is for so many people. And to let you know that all of us here at Reveal are doing everything possible right now to bring you shows that feel vital and current in response to the coronavirus. Reveal is part of a nonprofit news organization. We depend on support from our members who are listeners just like you. Recently, I had the chance to call up one of reveals youngest members. His name is Elliot. He started listening to the show with his mom on the way home from swim practice and eventually he asked her if he could use money from his allowance to help support what we do.

 

Elliot: Hello?

 

Al Letson: Hello, Elliot?

 

Elliot: Yes.

 

Al Letson: Hi, this is Al Letson from the Center for Investigative Reporting and PRX. How you doing?

 

Elliot: Good.

 

Al Letson: I heard that you are a member of Reveal, that you donate to us every month.

 

Elliot: Yes.

 

Al Letson: I just wanted to call and say thank you. I think it is so amazing for you to do that.

 

Elliot: Thank you.

 

Al Letson: How old are you?

 

Elliot: Eight.

 

Al Letson: You're eight years old, that's amazing. Do you have a favorite episode?

 

Elliot: I think you'd be the one, Behind the Smiles.

 

Al Letson: Oh, yeah, yeah, about Amazon, right?

 

Elliot: Yes.

 

Al Letson: You are a very awesome young man and you just totally made my day to talk to you.

 

Elliot: Thank you.

 

Al Letson: Can you just say, there's always more to the story.

 

Elliot: There's always more to the story.

 

Al Letson: Bam. All right, Elliot, you are excellent. I really appreciate you. Thank you for being a member so much. I can't tell you how much it means to me.

 

Elliot: You are so very welcome.

 

Al Letson: All right, buddy, you have a good day.

 

Elliot: Thank you, bye.

 

Al Letson: Bye, bye.

 

Al Letson: Elliot, like all of our Reveal members helps make this show possible. If you aren't a member yet and have the means to help, please show us your support. To become a member, just text the word Reveal to 474747. Again, text Reveal to 474747. Thank you and remember, the only way forward is together.

 

Al Letson: From the Center for Investigative Reporting and PRX, this is Reveal. I'm Al Letson and I don't need to tell you, we are living through some scary times that most of us never imagined could happen. So I'm standing outside my house right now and my neighborhood is normally pretty busy this time of day. It's family friendly, pulsating with life, but now, there are hardly any cars on the road. The absence of little kid's laughter, well, it's eerie. It's like we're all trapped in a story and not reality. I'll admit it's easy for me to go there because I read a lot of post apocalyptic stories. The one that stands out in my mind right now is Parable of the Sower by Octavia Butler. It's about the collapse of society and a woman who forms a community out of the remnants. The book makes it clear that when the world is falling apart, well, it's not just one thing, it's all the things. And this era we're in that feels true as we grapple with the medical crisis surrounding COVID-19, there's also the financial one.

 

Speaker 3: We are going into a global recession.

 

Speaker 4: This is worse than 2008. This is worse than 1987.

 

Speaker 5: In fact, we anticipate the worst economic fallout since the Great Depression.

 

Al Letson: Now, we all hope it doesn't go that way. But many of the world's leading economists believe we could be facing the worst crash in close to a century. That's despite Congress passing a $2.2 trillion stimulus package.

 

Donald Trump: Well, thank you all very much. It's a very important day, I'll sign the single biggest economic relief package in American history. And I must say...

 

Al Letson: That relief package provided hundreds of billions of dollars for small businesses. But from the start, it was plagued with problems. People found it hard to apply for it and it's already run out of money. We're going to spend today's show talking to small business owners and their employees. With more than 20 million Americans now out of work, we start by looking at whether this crisis could end with people losing the very homes they've been forced to isolate themselves in. Here's Reveal's Aaron Glantz.

 

Aaron Glantz: There's this little house about 40 miles northeast of San Francisco at the end of a commuter rail line. It's a single story bungalow built in 1923 in the old downtown of Pittsburg, California.

 

Monica Perez: It means everything right now because this is where my kids can be in safe place.

 

Aaron Glantz: Monica Perez is sheltering in place here with her two kids.

 

Monica Perez: I believe with this epidemic that we have right now, this is the only place where they can feel safe.

 

Aaron Glantz: Monica is a single mom and a preschool teacher. But she lost her job last month when the school shut down because of the coronavirus and for weeks she's been trying to reach her bank.

 

Speaker 9: Thank you for calling Wells Fargo. You've reached our customer assistance line. We're here to help during...

 

Aaron Glantz: She calls and calls but can't get anyone on the phone.

 

Speaker 9: If you are calling for assistance due to COVID-19 impact, please listen closely.

 

Aaron Glantz: The bills keep adding up. Not only Monica's mortgage, there's also the electric bill, food, gas. She's worried about losing her home.

 

Speaker 9: At this critical time we are working to serve you as quickly as possible. Please stay safe and take care of yourself and your loved ones.

 

Aaron Glantz: Monica bought this house for $130,000 in 2011, right after the housing bust. It's more than doubled in value since then. Her home is her life savings, and her mortgage payment is her largest monthly expense. Wells Fargo is offering borrowers like Monica forbearance, which means that she doesn't have to pay her mortgage right now but she will eventually.

 

Monica Perez: They're going to accumulate that on your mortgage. So no, that's not going to work for us.

 

Aaron Glantz: Wells Fargo's profits are way down because of the coronavirus, but it still entered this crisis flush with cash. The bank returned $30 billion to shareholders through stock buybacks and dividends last year and still reported $20 billion in profit. Monica says she has two months worth of savings.

 

Monica Perez: We need those bills to be canceled, like cancel.

 

Aaron Glantz: Like millions of Americans, Monica doesn't know how long she'll be out of work. And every month she doesn't pay her mortgage. She's worried the ultimate bill will be that much bigger and that she'll never be able to catch up even if she gets her old job back.

 

Monica Perez: How we're going to do this? Because our job is going to be the same one. The pay is going to be the same one. How we're going to do this? And I'm pretty sure I'm not the only one.

 

Aaron Glantz: Monica is stuck at home and stuck on hold, wondering what's going to happen to her. And the powerful people who are supposed to help her and millions of other Americans are sheltering in place too.

 

Mark Calabria: I am working from home out of my home office.

 

Aaron Glantz: That's Mark Calabria. You may not have heard of him, but he's one of the most powerful people in America when it comes to housing. He helped lead the libertarian think tank the Cato Institute. President Trump appointed him director of the Federal Housing Finance Agency. Now he controls almost half of all mortgages in America, for both homeowners and landlords. And like the rest of us, he's not sure what's going to happen next.

 

Mark Calabria: If you've got a crystal ball and can tell me where we're going to be in three months, I really would appreciate you sharing that with me.

 

Aaron Glantz: Stuck at home, Mark Calabria has still taken action. He suspended foreclosures on loans owned by the giant government controlled mortgage companies, Fannie Mae and Freddie Mac. For people hurt by the crisis, the $2 trillion stimulus took those protections even further. Here's what that means for you, if you're a homeowner with one of these loans, and you've lost your job, Calabria says you should ask your bank to put off your payments and the banks have to do it. If you're a landlord and your tenants can't pay their rent because the pandemic, you're supposed to get relief too. And if you're a tenant, it's a little confusing. If you're living in a building where the landlord has a mortgage backed by Fannie Mae or Freddie Mac, you're protected from eviction.

 

Mark Calabria: We at the federal level have said if you landlord have a federally backed mortgage, we will give you forbearance in order to pass that along to your tenants who may have lost their jobs or loss of income.

 

Aaron Glantz: But here's the problem, almost nobody knows who owns their mortgage. It's rarely the company you write your monthly check to. And if homeowners don't know who owns their mortgage, you better believe tenants have no clue who owns their landlords. Calabria says tenants should just ask.

 

Mark Calabria: But really, if you're a tenant and you can't make your rent. First person you should talk to is your landlord. And if your landlord says, "Well, if you don't pay rent at how do I pay my mortgage?" You can always say and you can say to the landlord, "Listen, if you have a Fannie or Freddie mortgage, they will give you forbearance because the rent can't be paid."

 

Aaron Glantz: You're telling tenants were often very vulnerable to call their landlord and ask their landlord who has the mortgage on the property?

 

Mark Calabria: Agreed, I would be the first to say it is a convoluted and it's not the cleanest solution but it's also, as a regulator of Fannie and Freddie with the mortgage, it's the only solution I can offer.

 

Aaron Glantz: It's a solution built for a short term crisis. But there are already signs we're likely heading for a bigger downturn. Tens of millions of people have already filed for unemployment. And many homeowners doubt delaying their mortgage payments will be enough to save them. What do you say to the preschool teacher that I talked to who's now out of work, doesn't know when she's getting get her job back and would just like the mortgage payments during the crisis to be canceled?

 

Mark Calabria: I think that's something she needs to take up with Congress. I don't have the ability to do that. Our objective at the end of the day is to get everybody back on their feet and keep them in their home. If this goes longer, we'll have longer term solutions, but with the hope that we are only in this situation for two to three months.

 

Aaron Glantz: During the 2008 housing crisis, the banks that helped cause the collapse by issuing millions of bad loans, got a massive bailout. And now American banks are in great financial shape. They cleared $230 billion in profit last year. So I asked Calabria why struggling Americans should have to make up their payments instead of forcing the banks and government run mortgage companies to eat that loss. Fannie Mae, which he oversees, made $14 billion last year.

 

Mark Calabria: I appreciate that. Fannie and Freddie have a combined $5 trillion footprint so let us put it this way. For instance, if were we simply to forgive mortgage payments for all of Fannie and Freddie's [inaudible 00:11:30], they'd go bankrupt in two weeks. Since I'm responsible for that not happening, the broader question of whether there should be a mortgage or rent holiday, that's a question for Congress. I'm not a legislator, I'm a regulator.

 

Aaron Glantz: Like everyone else, members of Congress are not supposed to leave the house right now.

 

Chuy Garcia: I can come upstairs next to the bedroom in a small cramped office.

 

Aaron Glantz: Congressman Chuy Garcia spoke to us from his home, a single family house on the southwest side of Chicago. He tried and failed to put stronger tenant protections, including a national moratorium on evictions into the $2 trillion stimulus bill President Trump signed last month. That bill passed without a single hearing. Garcia says it was difficult for even members of Congress to be heard.

 

Chuy Garcia: The last bill was the biggest single bill enacted by Congress in its history, with only a handful of people actually meeting face to face, mostly doing the negotiation via phone. So it's a very exclusive process even more so than the normal process in Washington, that's what you get.

 

Aaron Glantz: Garcia says he'll keep pushing. There's going to be another stimulus bill. And he's trying to include $100 billion to help vulnerable tenants pay rent.

 

Chuy Garcia: People are going to remember that the big financial institutions that were bailed out in the 2008 agreement were many of the same culprits who brought about the financial meltdown on Wall Street that was attributable to sheer greed. What people know in the onset of the pandemic is that they need help, and they expect the government to help them in their time of need.

 

Aaron Glantz: The Trump administration is already negotiating with Congress over what the next aid package will look like. Representative Maxine Waters is on the deal making team. She's Chair of the Financial Services Committee, one of the most powerful Democrats in Congress. I reached her at her home in Los Angeles.

 

Maxine Waters: We will be doing everything that we can to make sure that people can have a decent quality of life and that they won't be so burdened, that they give up, that they walk away or that they lose their homes. And so we're going to do real good oversight.

 

Aaron Glantz: But it's been tough. Waters tried to get a national moratorium on all foreclosures, no matter which company owns the mortgage into the last stimulus. That didn't happen. And she wanted $300 million to prevent banks and landlords from discriminating against people of color during the pandemic. She got a fraction of that, just two and a half million. But the kind of relief that out of work preschool teacher Monica Perez wants, to have her mortgage payments during the crisis not just delayed, but disappear? Maxine Waters doesn't see that happening.

 

Maxine Waters: I do not at this point, but I sympathize with that, identify with that. And that would be an extraordinarily generous thing for this country to do for it's homeowners. What I like to see forbearance, I like to see each individual work with by their bank, by their servicer, so that you can figure out what their incomes are, what the debts are, how they will be able to manage.

 

Aaron Glantz: That's exactly what out of work homeowners are trying to do right now.

 

Speaker 13: Welcome to Wells Fargo home lending customer assistance. Please hold while I transfer you.

 

Aaron Glantz: Monica was still having trouble getting anyone from Wells Fargo on the phone.

 

Monica Perez: Well, I've been calling them, continue doing the same thing that I have to do. I can't get ahold of anybody yet.

 

Aaron Glantz: I started working with Monica, trying to figure out if her loan was owned by one of the big government controlled mortgage companies, Fannie Mae or Freddie Mac. I walked her through some tools, which are buried on a Treasury Department website. So when it says know your options, loan look up, click there.

 

Monica Perez: No, it's not them.

 

Aaron Glantz: So I dug into the property record, and found Monica's loan is backed by another government agency, the Federal Housing Administration. That mortgage is also covered by the stimulus package. It means that Monica can delay making payments for up to a year. She won't be fined for late payments, but eventually, she'll have to make it all up. It's not what she wanted, but it will keep her and her children in their house for now.

 

Al Letson: That story was from Reveal's Aaron Glantz and Katharine Mieszkowski. Aaron reached out to Wells Fargo and asked them what was going on with Monica's loan. They didn't want to talk but a spokesperson emailed saying someone would get in touch with Monica to review her options and get her the assistance she needs. Homeowners aren't the only ones struggling. Small businesses are also looking for help to stay afloat during this crisis. That story is coming up next on Reveal.

 

Al Letson: From the Center for Investigative Reporting and PRX, this is Reveal. I'm Al Letson. Unemployment claims are at an all time high, with more expected as social distancing continues. With most of the country in some form of lockdown, chances are, you aren't making any hotel reservations anytime soon. That's hit the $200 billion hotel industry pretty hard. While you may be familiar with brand names like Hilton, Hyatt and Marriott, most of the hotels you stay in are actually owned by small businesses. That's because over 90% of the nearly 33,000 hotels in the United States are franchised. And those franchise owners are the ones struggling to keep employees on the job. Reveal's Jonathan Jones has more.

 

Mohamed  Islam: Thank you for calling [inaudible 00:17:44], it's Mo, can I help you?

 

Jonathan Jones: Yes, I'm looking to talk with Mo?

 

Mohamed  Islam: Yes, how can I help you?

 

Jonathan Jones: I reached Mohammed Islam or Mo at the front desk of the Holiday Inn Express and Suites in Columbus, Ohio. It's a slow day, really slow.

 

Mohamed  Islam: Yes, nobody here, empty right now.

 

Jonathan Jones: Normally the spring season is packed, as fitness enthusiasts from around the world flock into town for the Arnold Sports Festival. It's one of the city's largest gatherings hosted by yes, Arnold Schwarzenegger. But the event was canceled due to concerns about the coronavirus.

 

Arnold Schwarze...: I think it was the right thing to do because we want to keep people safe and we want to keep people healthy.

 

Jonathan Jones: The morning I talked to Mo fewer than 10 rooms out of the hotels 100 are occupied.

 

Mohamed  Islam: The pool is closed, is actually only one person in the front, that if you see in the morning time, maybe one or two guests come down for the checkout or they go outside as a pin drop silence. Yeah. Can I put you on hold, please?

 

Jonathan Jones: Yeah, go ahead.

 

Jonathan Jones: Many of the rooms have been vacant for more than a month. The conference rooms are locked and a lounge near the lobby has been blocked off.

 

Mohamed  Islam: Sorry for holding-

 

Jonathan Jones: No, no, no, that's [inaudible] I'm fine. You got to do your job. Mo was born in Bangladesh and moved to Columbus in 2012 so his wife could be closer to her family. He started on the night shift making minimum wage and gradually worked his way up to a salaried front desk position. He says he now brings home close to $2,000 a month. With schools closed, his wife has stopped working to take care of their two young kids. The monthly bills however, stopped for no one. There's the $220 for the Hyundai Sonata, $1,000 for the mortgage. His savings, he says, will only last a month or two. So every day even as the COVID-19 crisis deepens, Mo keep showing up for work.

 

Mohamed  Islam: Sometimes I'm worried about the for the kids, for the virus also.

 

Jonathan Jones: Mo says he's grateful to still have a job, even though his hours have been reduced. No one at this hotel has been laid off, at least not yet. But that possibility is on everyone's mind.

 

Manav Singh: It's unprecedented, it's something that we've never seen before and that's a first in our industry.

 

Jonathan Jones: Manav Singh is Mo's boss. He co-owns this Holiday Inn Express with his dad, along with the Staybridge suites next door.

 

Manav Singh: I think you saw close to half a million dollars worth of business from each one of the hotels just vanish overnight.

 

Jonathan Jones: Between their two hotels, Manav and his dad are struggling to keep 50 people on the payroll.

 

Manav Singh: Some of our employees have been with us for more than 10 years. Our executive housekeeper drives 55 miles a day one way from Mount Gilead, Ohio, and she has been with my dad ever since he was just a general manager of a hotel 18 years ago.

 

Jonathan Jones: Manav and his dad run their hotels as franchisees of the Intercontinental Hotels Group, or IHG, which includes brands like Holiday Inn and Crowne Plaza. Like fast food restaurants and car dealerships, the franchise hotel model relies on a company, in this case IHG, to provide brand name, some standards and general operating procedures. In turn, the local franchise owner puts up the money for the business, takes on the mortgage or the construction debt, hires the employees and essentially has the responsibility of running the place. They also pay fees to the parent company for things like marketing, upkeep and reservations. In recent years, it was generally a profitable model for both sides of this equation. But when things go wrong, like when a global pandemic wipes out your entire revenue base seemingly overnight, it's franchise owners like Manav who are left trying to keep things afloat.

 

Manav Singh: There's no IHG corporate officers, corporate employees standing at our desks taking care of situations that we face firsthand.

 

Jonathan Jones: Manav says he's become increasingly frustrated with what he sees as a lack of guidance and assistance from the corporate office. As the crisis unfolded, IHG was sending emails telling owners they should close the pool, shut down the breakfast bar, lock up the fitness center. But he says that's not the type of guidance he needed.

 

Manav Singh: I mean, none of us would be hoteliers today if we didn't know that right off the bat. What I think the owners would have loved to have seen was communication. Hey guys, we are working on helping all of you financially in some capacity. Stay tuned.

 

Jonathan Jones: Manav went to the online form of the IHG Owners Association, which was flooded with posts. The association is independently run but housed inside corporate headquarters in Atlanta. Online, owners were asking lots of questions trying to find out what individual hotels were doing. Manav made contact with Samina Sharp, owner of a Holiday Inn Express, 2000 miles away in San Jose, California.

 

Samina Sharp: One of the common themes in dealing with IHG is the stonewalled one-sided communication. And I felt like for the first time I was talking to an owner who wanted to go beyond that.

 

Jonathan Jones: Then on March 17th, Manav's account on the owner's forum was disabled. Though he says he didn't violate any code of conduct. He emailed a screenshot to a bunch of his colleagues

 

Manav Singh: And all of a sudden you had a fury of hotel owners stand behind [inaudible] this is not right. This is not a democratic way of running this organization.

 

Jonathan Jones: They eventually reactivated his account and apologized. Samina and Manav formed a new ad hoc organization called the Hotel Owners Community to advocate for more relief. Samina started firing off sharply critical open letters and emails to corporate saying things like...

 

Samina Sharp: While your executive team is mulling over options on how best not to let your stock price further tank, we are here dealing with the crisis firsthand.

 

Jonathan Jones: IHG has made some changes, including relaxing standards and offering discounts off marketing and reservation fees. Samina tells me that doesn't really help.

 

Samina Sharp: You're going to laugh when you hear how mind-boggling this. It's really great marketing is what it is. Okay, well what do they base that marketing fee and the reservation fee on? Gross rooms revenue. So you have to sell rooms in order to pay these fees. But as you know from talking to us, we don't have any revenue. So zero times three is still zero. Zero times 25 is zero. Not a lot of huge breaks there, right?

 

Jonathan Jones: Samina says what she and other hotel owners really need is more of a break on the fixed fees they're still paying to IHG. Fees that other hotel companies like Best Western, have relaxed for their franchises.

 

Samina Sharp: I don't understand why I'm paying $14.65 times 57 rooms, which comes out to about what, $835 per month? That doesn't go away whether I sell rooms or not, I still have to pay that.

 

Jonathan Jones: For their part, IHG says they have offered some fee relief. In an emailed statement, a spokesperson said they've been working to support franchisees since the beginning of the crisis, through the IHG Owners Association, by cutting corporate costs including salaries, deferring planned upgrades and renovations and hosting webinars for owners. But Samina says she's still not getting the support she needs. So on April 10th, she furloughed her workers and closed her hotel down.

 

Samina Sharp: I'm not going to stay operational and take all the risk just so IHG can make money. They're the last people on my list of things I care about right now.

 

Donald Trump: So we're joined this afternoon by the true leaders of our nation's travel, hospitality and tourism industry...

 

Jonathan Jones: On March 17th, the same day Manav's account on the owners forum was shut down, President Trump met with executives from some of the biggest names in the hotel industry. IHG's CEO was there.

 

Elie Maalouf: Thank you Mr. President. Elie Maalouf with Intercontinental Hotels Group, chief executive of the Americas. We have nearly 6,000 hotels around the world, over 3,800 hotels...

 

Jonathan Jones: Samina says she heard about the meeting but didn't feel like it had anything to do with her.

 

Samina Sharp: There is such distance between me, people in my position, licensees, and the CEOs of these corporations. They sort of treat their franchisees as a part of the team when it suits them to bolster their numbers and look big and mighty. But then when it comes down to actually getting the spoils of war, then it's like, okay, well, it's for our corporate employees. No, we're left entirely out of the conversation.

 

Elie Maalouf: And so I think I'm very pleased that we can work together with you, the administration, to find a solution to preserve that network of entrepreneurs across the country.

 

Donald Trump: Yup, we will.

 

Elie Maalouf: Thank you, Mr. President.

 

Jonathan Jones: Eight days later, the President signed the federal government's $2.2 trillion Coronavirus Rescue Package into law. Manav says he's glad the stimulus package includes several items like small business loans and tax breaks that could help franchisees. But he says the loans will just add to the debt that hotel owners can barely manage as it is.

 

Manav Singh: There are a lot of hoteliers that have not been able to meet their debt services this month, that is a fact.

 

Jonathan Jones: The stimulus lacks major allocation, the $350 billion Paycheck Protection Program was set up to give loans to small businesses to cover payroll and some operating costs. Some or all of these loans can be forgiven if a company keeps wages at or close to pre-virus levels and doesn't lay anyone off. But by the middle of April, the program had already run out of money. Manav did apply but he says the maximum loan amounts aren't even enough for most hotel owners to cover payroll, operational and mortgage costs. Plus the franchise fees that many are still paying.

 

Manav Singh: It's just made everybody realize that we are on our own. And when this is over, we'll see who survives.

 

Jonathan Jones: The largest hotel owners trade group, the Asian American Hotel Owners Association says the federal relief package will not prevent mass layoffs. They also expect to see a large number of foreclosures and failed businesses, as franchise owners default on loans in the coming months.

 

Pawan Dhingra: Conditions like this are why the hotel industry is set up to the way that it is.

 

Jonathan Jones: Pawan Dhingra is a sociologist at Amherst College and author of a book about the hotel and motel industry.

 

Pawan Dhingra: You can benefit during good times but during bad times it's relatively insulated from as much damage as would otherwise be.

 

Jonathan Jones: But the people who will be hit hardest are the employees working in an industry where all the pressures to cut costs are aimed downward at the lowest rungs of the ladder.

 

Pawan Dhingra: These are not highly paid jobs, definitely not glamorous jobs. They are oftentimes part time jobs. They may not have full benefits that we would hope people to get. So quickly, right, these are individuals who will either go from full time to part time or part time to unemployed. Because the most important thing to do for these owners is finding a way to cut costs when there's less income coming in. It's a simple matter of arithmetic.

 

Jonathan Jones: Nearly four million workers in the hotel industry have already been furloughed or are expected to lose their jobs in the next few weeks. Back at Manav's Holiday Inn in Columbus, front desk clerk Mo Islam still plans on showing up for work.

 

Mohamed  Islam: I believe within a couple of months, maybe we get back again if everything get together, I wish.

 

Jonathan Jones: If this job wasn't around or you get laid off, what options do you have?

 

Mohamed  Islam: I actually, I have no option other than that, then I find a new job because my expense not stop. If the company lay off then I can survive a maximum two months. After that I have to find out the new job. Give me once second, please, okay?

 

Jonathan Jones: Yeah, of course, of course.

 

Speaker 21: ... Finding the assistance you need. Please hold, we'll be right with you.

 

Al Letson: Thanks to Jonathan Jones for that story. We made multiple requests to interview IHG executives but they declined. Manav Singh is one of several hotel franchise owners who've posted petitions online asking corporate brands for more financial support. By mid-April, close to 15,000 signatures have been gathered. Small business owners of all kinds are suffering in the wake of COVID-19. From restaurants to art galleries to dog grooming parlors. We'll check in with one neighborhood outside of Seattle and see how their shops are faring, up next on Reveal.

 

Al Letson: From the Center for Investigative Reporting and PRX, this is Reveal, I'm Al Letson. We're going to do something now that people aren't doing much of these days, taking a stroll down the street in...

 

Speaker 22: Beautiful White Center, we offer public roller skating for families, as well as adult only nights. 21 and over with a bar...

 

Al Letson: White Center, it's an urban neighborhood in King County just south of Seattle. The roller rink sits on 16th Avenue, the main drag here since 1908. The rink's shiny disco ball has stopped spinning. Its doors are closed due to the coronavirus, like many of the more than 200 businesses here. Many of them started by immigrants from Vietnam, Cambodia, East Africa and Latin America. As we head north up the street on our right we passed Five Noodle Shop, Nirvana Cannabis Dispensary, Proletariat Pizza and Smoke Town, which still open for now.

 

Paul Kim: We had a mad rush for about roughly 10 days. I think to people were kind of worried about where they're going to get their nicotine fix.

 

Al Letson: Owner, Paul Kim moved here from Guam 25 years ago.

 

Paul Kim: April 1st rolled around and we noticed the impact of people not working. Sales are down, I noticed a lot of people bringing in change. Usually you'll see change at the end of the month. But we see it very early, which is very disturbing as a business owner. And then, that's only April.

 

Al Letson: Next door to Paul is Aaron's Bicycle Repair.

 

Aaron Goss: Hang on a second, come in. Just duck under, yeah, I got a customer.

 

Al Letson: Aaron Goss runs the place with his one employee. Business is good right now. Thanks to sunny weather and a craving for outdoor exercise.

 

Aaron Goss: We only allow one customer at a time and they must wear a mask. We sanitize their bike before and after and we sanitize their credit card.

 

Al Letson: Right across the street is Full Tilt Ice Cream.

 

Hannah Bracey: We like to say Seattle's most punk rock ice cream place.

 

Al Letson: Hannah Rae Bracey works at the store and says the owner stayed open at first.

 

Hannah Bracey: People tried really hard to support the business. We would have people come out just to support our business. That's the only reason they bought ice cream.

 

Al Letson: But it got too hard. The shop shut down, laying off the staff. Hannah's collecting unemployment and trying to market her skills as an artist online but that community is also taking a hit.

 

Jake Prendez: My name is Jake Prendez and I am the owner and co-director of the Nepantla Cultural Arts gallery.

 

Al Letson: It's a cultural center and gift shop featuring White Center artists.

 

Jake Prendez: We just made our exhibition a virtual gallery and so you can contact the artists, you can purchase our directly from the artists.

 

Al Letson: Local artists are also painting murals on newly boarded up buildings with messages like, "In This Together" and "Stay Safe." Reveal's Emily Harris has been talking to business owners in White Center. It's a window into how the coronavirus is affecting the 30 million small businesses around the country. And the changes that communities like this will face as they struggle to survive.

 

Emily Harris: White Center got associated with the coronavirus early on. There were no reported cases there but it was the first spot county officials chose to put a quarantine facility. Temporary trailers with isolation rooms for up to 40 people.

 

Sili Savusa: I found out about it maybe 10 minutes before the press release and was just extremely irritated.

 

Emily Harris: Sili Savusa leads the White Center Community Development Association, a nonprofit that supports families and small businesses. She didn't question the need for quarantine centers around Seattle, she questioned the powers that be imposing it on White Center, a low income longtime immigrant neighborhood with little political clout.

 

Sili Savusa: This wasn't about not wanting to help people who have to deal with corona, it's just, look where you're putting it. You're continuing to perpetuate this whole institutionalized racism and not giving White Center community a voice in something like this that's really important.

 

Emily Harris: Ana Castro heard about plans for the quarantine center from her sister. The two have owned a bakery and restaurant in White Center for almost 25 years.

 

Ana Castro: And they say no. And then I think, why and I thought, well if we have that here we are not going to have any customer coming to our bakery.

 

Emily Harris: The center still hasn't opened but the coronavirus has nearly shut down Ana's business anyway. She's only doing takeout and had to lay off half the employees. She and her sister now work seven days a week. They clean, they sell, they enforce social distancing. Other family members have stepped in to help for free. Ana can't stop the questions rolling in her mind.

 

Ana Castro: I thought, how are we going to keep up with our business? How are we going to survive? Then we were thinking of our retirement, planning our retirement. And now this seems like, I mean your life is ending.

 

Emily Harris: Ana got her application into the new $350 billion Paycheck Protection Program before it ran out of money this past week, small businesses across the country applied including us here at Reveal. If Ana gets approved that could help her pay the handful of employees she still has and maybe hire some back.

 

Ana Castro: We are a family business and we care about our employees. And a lot of them depend from us. I have a family that she is the only one working right now here because her husband Hassan, they lay him off. And this is the only job that she has at this moment.

 

Emily Harris: Ana also has utility bills and rent. She says the power company and her landlord said she could pay later, but eventually she'd have to pay in full.

 

Ana Castro: This is a small business not, I mean, Boeing or I mean, Microsoft or Amazon. I can't survive any longer if we don't, I mean, get any help.

 

Emily Harris: Ana applied for a local grant from the White Center Community Development Association. They've set aside $100,000 for businesses hurt by coronavirus closures. The amount is so tiny compared to the need, as small as the virus itself, you might say. Helen Shor-Wong is in charge of figuring out the guidelines for those grants. She is sitting down with local business owners to find out what they need.

 

Helen Shor-Wong: So we go through the questions of, with the merchant, where would you put the grant dollars if we gave them to you and they're going right to rent, just goes back to the landlord. It goes back to the property owner.

 

Emily Harris: Paying rent is vital to keep many local merchants from going under right now. But Helen would rather see the rescue money stay with local businesses instead of going to their landlords.

 

Helen Shor-Wong: I think the hardest part of this is I think the inequity prior to coming COVID, is going to still be there after COVID but with I think a greater intensity.

 

Emily Harris: A 15 minute walk from Ana's bakery, Deborah Schwartzkopf runs Rat City Studios, a ceramics workshop. Right now a lot of her cash is tied up in clay. She shows me on video conference a wall of cardboard boxes.

 

Deborah S.: Each box is 50 pounds of clay and they are stacked five high in one, two, three, four, five, six, seven, eight, nine rows. And this is both for myself and for the classes that I would have held.

 

Emily Harris: She walks outside to show me her studio expansion plans that are now on hold.

 

Deborah S.: The day that I filed for permits to get my kiln extension going, the King County permit office closed so that's on hold. Not to mention I can't pay for it now.

 

Emily Harris: Deb earns a living selling pottery, teaching classes here and around the country and training young potters. When the coronavirus canceled a big national ceramics conference, she lost thousands of dollars in sales and workshops. She is earning some money by teaching ceramics classes online for the first time.

 

Deborah S.: I have gotten, I think but great response. I've also spent a ridiculous amount of money on cords and dongles in order to get everything to hook up. It's like I've ordered so many wrong cords, it's stupid.

 

Emily Harris: Like Ana, Deb is applying for any help she can.

 

Deborah S.: I have applied for a Facebook grant, a Verizon grant. I've applied for an SBA loan, a BECU loan, which is my bank.

 

Emily Harris: BECU is a credit union with a neighborhood office in White Center. Shortly after Deb applied, it and many other banks got overwhelmed and stopped taking applications for the Paycheck Protection Program. Then 10 days after opening, the federal government shut the program's doors saying available funding had run out. Helen Shor-Wong says that many White Center business owners didn't even get a chance to apply. They told her that from the start they kept running into walls.

 

Helen Shor-Wong: "So Helen, I'm part of U.S. Bank. I've asked them about the PPP but they're not ready." Or, "Oh Helen, I talked with my bank and they're not even processing the PPP." And then you get the bank that says we're already over committed. And so what happens is many of our community businesses will come in a little bit late in the game. So it's a very difficult situation. It's kind of causes paralysis, actually. I mean it's so overwhelming.

 

Emily Harris: Like Ana at the bakery, Deb has no idea what her ceramics business will look like on the other side of this pandemic.

 

Deborah S.: Just feeling motivated to keep going is kind of hard because, anyway, because it feels complex and uncertain. Yeah.

 

Emily Harris: Many of the business owners I spoke with in White Center are doing the same as Deb and Ana are, trying to stay afloat in new ways, applying for whatever help they can. But Young Cho is an exception. Back in February, he posted a video on Facebook announcing that he was about to turn his popular Tex-Mex Asian fusion food cart into a brick and mortar restaurant in White Center. But COVID-19 changed his plans.

 

Young Cho: I just knew I wouldn't be able to open essentially anytime in the near future.

 

Emily Harris: As far as Young can tell he doesn't qualify for any financial help, local or federal.

 

Young Cho: Because I don't have payroll established, I technically haven't opened my doors. I'm not eligible for any of these programs. I mean I've talked to CPAs and a couple lawyer buddies of mine and a couple finance guys and they're just pretty much all kind of had the same consensus, I'm in that gray area.

 

Emily Harris: He had staff lined up but hadn't hired them. He's paying rent on his new restaurant but can't open. His food truck is all but closed. He's offering his Facebook followers a few dishes delivered. Truck business was supposed to bring in cash for the restaurant renovations. Young figures he's already about 20,000 bucks behind where he needs to be to open. He's borrowing from friends and wondering how long he can hold on.

 

Young Cho: It's like having a child in the middle of a zombie apocalypse is kind of where I'm feeling [inaudible 00:42:43], it's like my child that I can't release into this world because impending doom is likely.

 

Emily Harris: For small businesses that impending doom would be closing doors forever. If that happens widely across the country it could keep unemployment high for a long time. In White Center, community leaders have another worry too. If COVID-19 closures here turn into bankruptcies, outside investors could swoop in buy up immigrant owned businesses, bring about more gentrification and perhaps fundamentally change the character of this community.

 

Al Letson: Thanks to Reveal's Emily Harris for bringing us the vibe of White Center, even virtually. Finally today, we have the story of another chef who's doing whatever he can to keep his business alive, to support his employees and his community. Here's reporter Tina Antolini with that story.

 

Tina Antolini: In 2005, just days after Hurricane Katrina and its aftermath devastated New Orleans, Chef Alon Shaya found himself in the parking lot of a looted Wal-Mart. He set up a propane burner and a giant pot.

 

Alon Shaya: And made the worst pot of red beans and rice I ever made in my life. No onions, no peppers, no sausage.

 

Tina Antolini: But the simplicity didn't seem to matter to the people who were eating. Everyone in the parking lot gathered around his table.

 

Alon Shaya: I was feeding people who either had just been rescued from the roofs of their homes or people who were rescuing those people from the roofs of their homes.

 

Tina Antolini: Alon who is originally from Israel, says the experience changed him.

 

Alon Shaya: It drove me to fall in love with New Orleans. I mean, it gave me a sense that I can contribute something, a feeling like I was needed. I'd never felt that way from a city before.

 

Tina Antolini: It's still his impulse to feed people now as his city has been thrust into the crisis have COVID-19. But the necessity of social distancing has been disorienting.

 

Alon Shaya: It's just been so much more confusing and it's been so much scarier because I feel like there is just this hurricane blowing through the air into people's lungs and you can't see it on a radar, you don't know where it's coming from. You don't know if the eye of the storm is here yet or not.

 

Tina Antolini: I've known Alon for years, eaten in his restaurants, collaborated with him on a cookbook. And never in all that time have I seen him so distressed. He and his wife Emily run their two Israeli restaurants, one in New Orleans and one in Denver together. Emily says they could feel the storm gathering back on Friday night, March 13th. They were at their New Orleans restaurant, Saba.

 

Emily: We actually were busier than we've ever been because I think people maybe also saw it coming down the line and were going out to support the restaurants while they could.

 

Tina Antolini: Alon says dining rooms all over New Orleans were packed.

 

Alon Shaya: I drove down Magazine Street and saw the bars overflowing with people and the coffee shops overflowing with people. And it felt like this very eerie experience of like watching the news and hearing about this (bleep) storm that's about to hit us.

 

Tina Antolini: By midday on that Sunday, the mayor announced that hundreds of restaurants in the city would have to close their dining rooms by 9:00 PM that night.

 

Speaker 36: Restaurants shall be limited in terms of their operations to take out, delivery or pick up.

 

Alon Shaya: And then Monday the day after, Emily and I had the worst day of our entire lives.

 

Tina Antolini: Alon called every single member of their staff at both their restaurants, Sabah in New Orleans and Safta, their outpost in Denver, another city going into lockdown. He had to tell dozens and dozens of his employees that they were going to be furloughed.

 

Alon Shaya: And I spent all day on the phone talking to every team member or texting with them. And I felt like we just kind of like failed.

 

Tina Antolini: Next, it became a dance of trying to keep as many people still working as possible while exposing them to the least amount of risk. Both restaurants pivoted to take out and delivery, neither of which they'd done before.

 

Alon Shaya: We got gloves, we got masks, we got sanitizer. We set up a pickup area for the guests so that we wouldn't have to come into contact with them. We shifted to just putting the bag of food on the hood of someone's car.

 

Tina Antolini: Each morning at the restaurants, they took everyone's temperature. But Emily says they still worried about whether it was safe.

 

Emily: It was just an uneasiness about being out there in front of customers and thinking like, if we were only breaking even or losing money and if that's what's happening it's not worth it to be open.

 

Tina Antolini: They weren't the only ones feeling that way. There is a sense of desperation from all corners of the restaurant industry, which operates on such thin margins that many are scraping by in normal times. Alon and Emily pivoted again. In New Orleans, they stopped doing takeout and started selling hummus and pita to a local grocery store chain. They turned Safta, their restaurant in Denver, into a crisis relief center, feeding hundreds of now unemployed restaurant workers each day.

 

Emily: We've been giving out toilet paper. We have a Amazon registry for diapers, baby food, personal hygiene products and things like that, that are being sent to the restaurant for us to give out.

 

Tina Antolini: The relief center is part of a national initiative. The Restaurant Workers Relief program, organized by a chef in Kentucky, Edward Lee. All over the country, restaurants are figuring out new ways of caring for people. Whether it's cooking for homeless folks, converting into grocery stores or banding together to feed and fundraise for the millions of hospitality workers who have already lost their jobs.

 

Tina Antolini: Meanwhile in New Orleans the number of COVID-19 cases was skyrocketing. Alon and Emily decided to change course yet again. Even doing hummus and pita delivery to the grocery stores started feeling too dangerous.

 

Alon Shaya: So we shut that operation down and now we've pivoted to just myself in my home kitchen, cooking meals for doctors and nurses. So today I am cooking at my house for the NOLA Doc Project, which is helping other medical residents get food every day at work. And I figured why not make some pita bread at the house so I have my broiler on.

 

Tina Antolini: In many ways, Alon and Emily are luckier than some. They have a strong network of connections to lean on.

 

Alon Shaya: Rolling out some dough.

 

Tina Antolini: Their restaurants likely qualify for help from the government stimulus package passed last month.

 

Alon Shaya: And we're going to serve that up with some hummus today as well with roasted asparagus and tahini and Aleppo pepper.

 

Tina Antolini: And while they can't do what comes naturally, gather people physically together, they're keeping busy exploring new ways to connect and be of help to their communities through food.

 

Alon Shaya: Okay.

 

Emily: We're on.

 

Alon Shaya: We're on, welcome. We're going to be cooking some buttermilk biscuits.

 

Tina Antolini: Alon's been fundraising for other relief efforts with online cooking demos, showing people how to make things like biscuits and kale jambalaya. It's still a bit of a work in progress. He tried to make his dog Ceci the taste tester.

 

Alon Shaya: What do you think, Ceci?

 

Emily: She didn't approve.

 

Alon Shaya: She spit it out. Well, there you go world.

 

Tina Antolini: In such uncertain times, the laughter feels as soothing as the food.

 

Al Letson: Thanks to Tina Antolini for that story. Katharine Mieszkowski, Najib Aminy and Emily Harris produced today's show. It was edited by Brett Myers, Jen Chien and Kevin Sullivan with help from Esther Kaplan. Taki Telonidis is our senior supervising editor. Victoria Baranetsky is our general counsel. Our production manager is Mwende Hinojosa. Our sound design team is the dynamic duo, J-Breezy, Mr. Jim Briggs and Fernando, my man yo, Arruda . They had help this week from Amy Mustafa. Our CEO is Christa Scharfenberg. Matt Thompson is our editor in chief.

 

Al Letson: Our theme music is by Comarado Lightning. Support for Reveal is provided by the Reva and David Logan Foundation, the John D. And Catherine T. MacArthur Foundation, the Jonathan Logan Family Foundation, the Ford Foundation, the Heising-Simons Foundation, the Democracy Fund, and the Ethics and Excellence in Journalism Foundation. Reveal is a co-production of the Center for Investigative Reporting and PRX. I'm Al Letson and remember the only way through this is together.

 

Speaker 36: From PRX.