GOP Blocks Small-Business Lending Bill

[Meister]

Small businesses DON'T WANT TO BORROW MONEY. Is this a difficult concept for you to understand?

The mid-year economic report released on Wednesday by the National Small Business Association disagrees with you:

NSBA has been asking small-business owners if their business had been impacted by the credit crunch since early 2008. In February 2008, 55 percent responded that it had. In August 2008 that number jumped to 67 percent, and continued to rise to 69 percent in December 2008 and hit a high of 80 percent in July 2009. Despite a slight easing in December 2009 down to 78 percent, the number today is back up at its highest point. Eighty percent—four out of five—of small business owners report that their company has been impacted by the credit crunch.

The availability of capital is a critical component to business growth and job creation for small businesses. Since 1993, when NSBA began asking these questions, there has been a direct correlation between access to capital and job growth—when capital flows more freely, small businesses add new jobs.

Among small-business owners for whom capital availability has been a problem, 44 percent state that they have been unable to grow or expand the business, and 20 percent state that they have been forced to reduce their number of employees. Perhaps even more worrisome is the growth in small businesses that report they are unable to increase inventory to meet demand—up from seven percent in December 2009 to 12 percent today. This means that, although growth opportunities exist for these businesses, they are being held back by a lack of capital.​

It's pretty obvious that conservative lenders are holding back hoping to hurt Obama.

They had an orgy of deregulation under the Republicans and were able to squeeze trillions out of the American Middle Class. They think if they can get Republicans back into to office, they can "finish the job".

They don't seem to understand a strong and financially sound Middle Class is "good for business". All they know is "Get it while you can".

You are a blind partisan, "deeno".

 

[boedicca]

I think until Obama's policies are in full light your going to see a hesitation from businesses to go out on a limb on anything. I can't blame them.

No kidding. Given the thuggery of seeing successful auto dealers lose their GM and Chrysler franchises because they weren't from the politically correct ethnic group or gender is a cautionary tale.

Why would a business that can hunker down with its own resources do anything to entangle itself with government provided funding which gives the Obama administration more power over that business?

 

[CrusaderFrank]

Small businesses DON'T WANT TO BORROW MONEY. Is this a difficult concept for you to understand?

The mid-year economic report released on Wednesday by the National Small Business Association disagrees with you:

NSBA has been asking small-business owners if their business had been impacted by the credit crunch since early 2008. In February 2008, 55 percent responded that it had. In August 2008 that number jumped to 67 percent, and continued to rise to 69 percent in December 2008 and hit a high of 80 percent in July 2009. Despite a slight easing in December 2009 down to 78 percent, the number today is back up at its highest point. Eighty percent—four out of five—of small business owners report that their company has been impacted by the credit crunch.

The availability of capital is a critical component to business growth and job creation for small businesses. Since 1993, when NSBA began asking these questions, there has been a direct correlation between access to capital and job growth—when capital flows more freely, small businesses add new jobs.

Among small-business owners for whom capital availability has been a problem, 44 percent state that they have been unable to grow or expand the business, and 20 percent state that they have been forced to reduce their number of employees. Perhaps even more worrisome is the growth in small businesses that report they are unable to increase inventory to meet demand—up from seven percent in December 2009 to 12 percent today. This means that, although growth opportunities exist for these businesses, they are being held back by a lack of capital.​

Yes, Obama & The Progressives are strangling small businesses so they can continue to expand government.

Real, but slight, growth starts when Obama loses Congress, then we roar back to live when we kick the Marxist to the curb in 2012

 

[CrusaderFrank]

The government: Fannie, Freddie and FHA now control 100% of the mortgage market.

 

[Jon]

The mid-year economic report released on Wednesday by the National Small Business Association disagrees with you:

From your very own article:

These traditionally-upbeat entrepreneurs have a far-more negative outlook today than they have in the last several years. Nearly half do not believe there will be any growth opportunities for their business in the coming year and well over one-third—41 percent—have concerns about the ongoing viability of their business. The majority of small-business owners (59 percent) expect the overall U.S. economy to be flat in the coming year, and 29 percent expect a recession.

Who would want to borrow money when they don't see their business as a viable ongoing entity? No one. It's basic microeconomic theory. Until they see economic growth as a reality, they will not be willing to take on more risk to continue their business.

Furthermore, the mid-year report shows that "lack of available" capital is #5 in concerns for small business owners. Economic uncertainty, lack of consumer spending, cost of health insurance, and federal taxes were all higher priorities. Also, 42% of businesses used earnings to meet their capital needs, while 43% used bank loans. This is a GOOD thing. This means that as many small businesses didn't need bank loans as did.

 

[LibocalypseNow]

More Bailouts? How many are we up to now? When is this madness going to end? Just stop passing punitive & unnecessary taxes like 'Indoor Tanning' taxes and small businesses should do just fine. More bailouts like this aren't the answer. So kudos to the GOP for at least trying to bring some sanity back to our Government. The Democrats are completely lost at this point. It's time for real change. Make 2010 count people.

 

[CrusaderFrank]

Obama and the Marxist Progressives have terrified American businesses. We need to take the gavel from Pelosi in 2010, then boot Obama to the curb in 2012.

Given Obama's malignant Narcissistic nature, he'll probably lose interest sometime in 2011 and quit.

 

[LibocalypseNow]

Yea we don't need more Bailouts. We just need the Socialist/Progressive Democrats to stop creating punitive & unnecessary taxes like "Indoor Tanning' taxes. Small businesses will do just fine if the Government will just get the h*ll out of the way. Looks like the GOP is catching on. Now they just need to win some Elections this Fall.

 

[CrusaderFrank]

Recession is when your neighbor loses his job, depression is when you lose your, recovery starts when Reid & Pelosi lose theirs and Prosperity begins when Obama loses his...

ehh, wordy, Sorry Ronny

 

[editec]

Small businesses DON'T WANT TO BORROW MONEY. Is this a difficult concept for you to understand?

The mid-year economic report released on Wednesday by the National Small Business Association disagrees with you:

NSBA has been asking small-business owners if their business had been impacted by the credit crunch since early 2008. In February 2008, 55 percent responded that it had. In August 2008 that number jumped to 67 percent, and continued to rise to 69 percent in December 2008 and hit a high of 80 percent in July 2009. Despite a slight easing in December 2009 down to 78 percent, the number today is back up at its highest point. Eighty percent—four out of five—of small business owners report that their company has been impacted by the credit crunch.

The availability of capital is a critical component to business growth and job creation for small businesses. Since 1993, when NSBA began asking these questions, there has been a direct correlation between access to capital and job growth—when capital flows more freely, small businesses add new jobs.

Among small-business owners for whom capital availability has been a problem, 44 percent state that they have been unable to grow or expand the business, and 20 percent state that they have been forced to reduce their number of employees. Perhaps even more worrisome is the growth in small businesses that report they are unable to increase inventory to meet demand—up from seven percent in December 2009 to 12 percent today. This means that, although growth opportunities exist for these businesses, they are being held back by a lack of capital.
​

We need more of this sort of reporting.

One grows tired of reading the same old theoretical nonsense coupled with politics by personality cult that most of you guys think passes for poltical discourse.

Business, ALL business, tends to borrow, folks.

When credit is tight it reduces the investments businesses can make.

A LOT of businesses borrow money EVERY YEAR. Retailers do that often, farmers likewise.

If you cannot borrow to prepare for the Christmas rush, for example, then you trying sell from an empty cart.

If there's a credit cruch for small businesses, and I don't doubt it one bit, then making money available is a damned good idea,

Small businesses employ far more people than large ones do, and the people THEY HIRE are the people most likely out of work, right now, too.

 

[CrusaderFrank]

We need to cut the Progressive hand off of the throat of American business

 

[Greenbeard]

Who would want to borrow money when they don't see their business as a viable ongoing entity? No one. It's basic microeconomic theory. Until they see economic growth as a reality, they will not be willing to take on more risk to continue their business.

And here we have the snake eating its own tail. Businesses may well hold off hiring and expanding until demand comes back. Demand won't come back until someone starts buying more. If we rule out direct government purchases to fill that gap, we turn to private households. But then we either need higher employment levels (which is the problem we're aiming to solve here in the first place) or we need money in the pockets of consumers through other mechanisms. We could do income tax cuts for the majority of households but that was done through the stimulus bill and we knew going in that wouldn't be nearly as stimulative as other mechanisms. We could fund aid that's known to be highly stimulative like unemployment benefits and food stamps but that gets tricky when the perception is growing that taking money out of the economy is the best way to get demand back.

So we've got a conundrum: small business are having trouble getting credit to expand and hire, and since so few businesses are expanding and hiring there isn't enough consumer demand for their products anyway. Chicken or egg?

Also, 42% of businesses used earnings to meet their capital needs, while 43% used bank loans. This is a GOOD thing. This means that as many small businesses didn't need bank loans as did.

It also suggests many businesses are treading water. NSBA's diagnosis isn't that small businesses are relying less on credit because they don't want it but rather because they can't get it:

Although lower demand for loans from small-business owners who are typically hesitant to take on additional debt in a distressed economy may be a part of the equation, the decrease in loans is more likely related to the terms and availability of such loans. Many banks appear unable or unwilling to lend affordable capital to any small businesses that doesn’t meet their extremely high definition of a “creditworthy” small business.​

 

[CrusaderFrank]

Who would want to borrow money when they don't see their business as a viable ongoing entity? No one. It's basic microeconomic theory. Until they see economic growth as a reality, they will not be willing to take on more risk to continue their business.

And here we have the snake eating its own tail. Businesses may well hold off hiring and expanding until demand comes back. Demand won't come back until someone starts buying more. If we rule out direct government purchases to fill that gap, we turn to private households. But then we either need higher employment levels (which is the problem we're aiming to solve here in the first place) or we need money in the pockets of consumers through other mechanisms. We could do income tax cuts for the majority of households but that was done through the stimulus bill and we knew going in that wouldn't be nearly as stimulative as other mechanisms. We could fund aid that's known to be highly stimulative like unemployment benefits and food stamps but that gets tricky when the perception is growing that taking money out of the economy is the best way to get demand back.

So we've got a conundrum: small business are having trouble getting credit to expand and hire, and since so few businesses are expanding and hiring there isn't enough consumer demand for their products anyway. Chicken or egg?

Also, 42% of businesses used earnings to meet their capital needs, while 43% used bank loans. This is a GOOD thing. This means that as many small businesses didn't need bank loans as did.

It also suggests many businesses are treading water. NSBA's diagnosis isn't that small businesses are relying less on credit because they don't want it but rather because they can't get it:

Although lower demand for loans from small-business owners who are typically hesitant to take on additional debt in a distressed economy may be a part of the equation, the decrease in loans is more likely related to the terms and availability of such loans. Many banks appear unable or unwilling to lend affordable capital to any small businesses that doesn’t meet their extremely high definition of a “creditworthy” small business.​

Your analysis is crap.

Everyone knows Obama wanted to destroy American business and supplant it with useless New Deal Progressive devaststion. Progressives have done a fine job of delivering the hurt these two years. People started hunkering down when the Marxist was elected and we're just waiting for Pelosi to lose the gavel, then for Obama to get booted.

 

[LibocalypseNow]

Yea just borrow more money. That's the answer. Yikes! Looks like the GOP was right on this one. No more Bailouts. Just keep their taxes reasonable and small businesses will do just fine. They don't need Socialists/Progressives who know nothing about running businesses,telling them what's best for them. Borrowing more is not the answer. Just get the Government off their backs and small businesses will flourish.

 

[Jon]

Who would want to borrow money when they don't see their business as a viable ongoing entity? No one. It's basic microeconomic theory. Until they see economic growth as a reality, they will not be willing to take on more risk to continue their business.

And here we have the snake eating its own tail. Businesses may well hold off hiring and expanding until demand comes back. Demand won't come back until someone starts buying more. If we rule out direct government purchases to fill that gap, we turn to private households. But then we either need higher employment levels (which is the problem we're aiming to solve here in the first place) or we need money in the pockets of consumers through other mechanisms. We could do income tax cuts for the majority of households but that was done through the stimulus bill and we knew going in that wouldn't be nearly as stimulative as other mechanisms. We could fund aid that's known to be highly stimulative like unemployment benefits and food stamps but that gets tricky when the perception is growing that taking money out of the economy is the best way to get demand back.

So we've got a conundrum: small business are having trouble getting credit to expand and hire, and since so few businesses are expanding and hiring there isn't enough consumer demand for their products anyway. Chicken or egg?

Also, 42% of businesses used earnings to meet their capital needs, while 43% used bank loans. This is a GOOD thing. This means that as many small businesses didn't need bank loans as did.

It also suggests many businesses are treading water. NSBA's diagnosis isn't that small businesses are relying less on credit because they don't want it but rather because they can't get it:

Although lower demand for loans from small-business owners who are typically hesitant to take on additional debt in a distressed economy may be a part of the equation, the decrease in loans is more likely related to the terms and availability of such loans. Many banks appear unable or unwilling to lend affordable capital to any small businesses that doesn’t meet their extremely high definition of a “creditworthy” small business.​

And again, you miss the point. It is a circular issue. If businesses hire, more people have money, more people spend money, and businesses get more earnings. That's all well and good, but based on this report and several other factors, business DO NOT want to borrow money for this purpose. So, why force a bill that won't solve the problem? If you want to pump $80 billion into the economy, give it directly to consumers. Small businesses don't want to be in debt for it. This is just another way for this administration to help the banks, because they will earn interest on these borrowings. Small business owners don't want to pay that interest. Give the money to the consumers, they won't have to pay interest on it, and it will create the same effect.

Furthermore, giving the money directly to consumers will still help the banks. Because how do banks raise capital? Deposit accounts. If you give consumers money, either they stick it in the bank or they spend it, and the businesses will stick it in the bank. Either way, it still ends up in the bank.

So the point is this: if the government wants to put money into the economy, it needs to put it in the right place. In this case, to the banks is NOT the right place. It needs go to to the consumers.

 

[CrusaderFrank]

In addition to repealing all of the Marxist/Progressive Legislation passed by Obama, in 2012 President Palin needs to propose: No taxes on any earning on any new business for the next 5 years.

 

[CrusaderFrank]

Greenbeard knows less that nothing about American business and I'm being kind

 

[Jon]

In addition to repealing all of the Marxist/Progressive Legislation passed by Obama, in 2012 President Palin needs to propose: No taxes on any earning on any new business for the next 5 years.

No thanks. That's a stupid idea. That will just create small businesses that will ultimately fail in year 6 when they can't pay their tax burden.

Also, it will create a frenzy of business restructuring where investors will dispose of one business to create another to earn the tax break.

Also, "President Palin"? Over my dead body.

 

[Greenbeard]

And again, you miss the point. It is a circular issue.

Actually that was my point. Hence the snake-eating-its-own-tail and chicken-or-egg references.

If you want to pump $80 billion into the economy, give it directly to consumers.

We're in agreement on this one. I'd like to see more money directly pumped into the economy. But the hopes of that happening are dimming.

 

[Jon]

Actually that was my point. Hence the snake-eating-its-own-tail and chicken-or-egg references.

Eh, guess I should have emphasized the "is," because I knew what you were trying to get at. I was simply trying to explain that this bill was attempting to solve the right problem in the wrong way. So I don't care who blocked it. It was a waste of paper to write the bill.