The recent Senate election in Massachusetts will have a profound impact on … small businesses? That appears to be the case, as the White House scrambles to push the right buttons to increase the President’s popularity. Health care reform – at least in the midst of a serious recession – apparently wasn’t the ticket, so a new focus is needed.
Since small businesses have often been described as the lifeblood of the economy, and small businesses generally lead the economy out of recessions, the President is proposing a popular new $30 billion Small Business Lending Fund, which would use money big banks repay to the TARP fund (after paying themselves their hefty bonuses, of course) to help small businesses create more jobs.
The idea is for the government to invest capital into “small” banks (those with less than $10 billion in assets) and let them handle the lending. All of the oversight “hooks” still need to be worked out (and have the potential to be dangerous, of course), but the belief is that these smaller banks are both more able and more inclined to deal with small businesses, which will make the program more effective.
Of course, $30 billion for small businesses pales in comparison to the $700 billion TARP fund, so if the administration’s top economists really believed small businesses were so important to the economy, they would have focused a bit more energy and capital on them in the first place – instead of rescuing the foolish titans of industry and the whimsical wizards of Wall Street whose hyperactive greed led to such excessive risk-taking. These “brains” of the economy are now incentivized to continue such behavior, because they know the government can be counted upon to bail them out (and if they get “fired,” they take home lucrative separation settlements that set them up for life).
But at least the President seems to realize now how important small businesses are – at least to his re-election chances. All of us know many people who own or are employed by small businesses. These intrepid entrepreneurs are the exemplars of American ingenuity, independence, and resilience, and they are our closest friends and neighbors. We’ll vote for the person who stands up for them, and that, of course, is the bottom line.
Here’s to the economic recovery, led by the honest sweat and toil of small business.