The observation that U.S. government technology is outdated isn’t new, but in the context of the crisis the problem has been recognized with a new urgency. The absence of adequate digital infrastructures has made it at times impossible for the government to get whatever congressionally mandated money it makes available or subsidizes out the door quickly to companies and people who need it most.

Problems have appeared already in several government assistance programs. The Washington Post, for example, reported Friday that several million people who filed their taxes via H&R Block, TurboTax and other services were unable to get payments because the IRS did not have their direct deposit information on file, according to the Treasury, companies and experts.

Meanwhile, the IRS launched a “Get My Payment” tool Wednesday for people to trackthe status of their payment and enter direct deposit information, but which has failed to provide any information for millions of Americans who have logged on. The reason? The IRS uses software first developed in 1962, and Congress’ economic stimulus has required multiple coding changes to the software. But ultimately, the Post reports, the agency has at least 16 other databases with taxpayer information, none of which easily can communicate with the other, said a person familiar with the matter.

Similar challenges have riddled efforts to assist small businesses. The new Paycheck Protection Program (PPP), designed to effectively offer grants to companies to keep their workforce, was slow to get out the gate. Bureaucratic challenges played a major part, but the underlying challenges of the Small Business Administration program’s technology also had a role.

The SBA’s application portal E-Tran, for example, can only support 3,000 applications per hour. But in today’s environment, there are 7,000 per hour. As Brayden McCarthy, a strategist for Stripe, observed in the Town Hall last week, there is no ability to support programmatic submission of applications to the SBA. The agency’s systems are instead dependent on people manually overseeing operations like cleaning up error messages. Consequently, the system is not designed to support over a matter of days what the SBA traditionally would have to support over 15 years — and the SBA’s ETran has been overwhelmed by demand for loan approvals.

Big banks unready (or unwilling?) for their new role Complicating things even further is that the SBA’s PPP program initially depended on big banks that are themselves surprisingly underdeveloped when it comes to key processes and capabilities necessary to execute successful policy responses.

The PPP is based on the SBA’s existing 7(a) loan program where the SBA doesn’t make loans; instead, SBA-approved banks do. But given the demand and need, there have not been enough banks to get the job done. Not only is the demand immense, but many SBA-approved banks haven’t exactly been in the mood to take on new customers. Big banks, in particular, have long been reputed to concern themselves most with servicing and keeping their largest customers, not getting new ones. And, as a result, they reportedly haven’t invested in systems designed to onboard new customers or make efficient or automate the kinds of compliance that accompanies it, like antimoney laundering and sanctions programs. So taking on new customers in bulk would require a relaxing of internal processes that could potentially open them up to government charges and penalties.

Thus not surprisingly, when the PPP was launched, many SBA lenders were only willing to offer loans to existing customers that had taken out loans with them in the past. As a result, small businesses with no existing relationships had difficulties getting financing assistance under the program.

Reviewing the problem, the government clarified its guidance for lenders and gradually opened up the program to fintech firms that had the infrastructure in place to process new customers and quickly get loans out. But days after the first fintechs received approval to participate in the program, the funding for the PPP program — all $349 billion of it — had been exhausted. And with the program working on a first come, first served basis, the initial iteration had the appearance of assisting those firms with the best connections and relationships.

The myriad technological issues aren’t going away soon, and just don’t look great for the United States. America is certainly not, when it comes to our infrastructure, number one. Or even average. Indeed, even middle-income countries now largely enjoy more advanced tools and technical infrastructure to financially assist and access their populations than the United States. From our government IT to our largest, most sophisticated institutions underinvesting in everyday people, we’re behind.

The stakes of such shortcomings have grown as quickly as the pandemic. No longer isthe country’s technological underdevelopment just embarrassing. It is now, in  very real sense, a national emergency in itself. Like many, I shudder to think what would be the consequences if an even deadlier virus was to emerge, and endanger the country’s public health. Upgrading not only our bureaucratic and political responses, but also the base layer infrastructure enabling public policy, will be a necessary component of effective reform.

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