Where small business wants stimulus
TEXT OF STORY
Bob Moon: President-elect Obama will be in northern Ohio today, touring a plant that makes parts for wind turbines. He’s spotlighting the alternative-energy funding that’s part of the $800 billion-plus he plans on spending to stimulate the economy.
We’re still trying to follow all that money this morning, but as we’ve mentioned before, it’s not going to be easy because so many people are grabbing for a piece. Small business advocates are arguing that half of the country’s jobs are on their payrolls, so the stimulus needs to address their needs, too. Here’s Marketplace’s Mitchell Hartman from the Entrepreneurship Desk at Oregon Public Broadcasting.
Mitchell Hartman: What small-business lobbyists usually tell lawmakers is some variation on the script: “cut taxes, trim the deficit, and stay off our backs.” We don’t expect to hear them telling the government to “spend, spend, spend.” But things are different now.
Susan Eckerly: We’re certainly pushing for some type of stimulus that would help small business owners, because as you know, no one’s spending money.
That’s Susan Eckerly of the National Federation of Independent Business.
Eckerly: Our members aren’t replacing inventory, they’re not hiring new workers, they’re not planning to make capital expenditures. So we’re looking for ways to stimulate sales.
First order of business: a few hundred billion for fixing roads and bridges, making government buildings more energy-efficient, and the like. That’s considered a good deal, since a lot of the work will be done by small local contractors.
A temporary payroll tax cut — basically, suspending Social Security taxes for employers and employees — is on the agenda, as well as new deductions for business investment and health insurance for the self-employed. And there’s broad support for a lot more Small Business Administration lending.
Todd McCracken is president of the National Small Business Association. His group wants 25 percent of any future bailout money for banks under the Troubled Assets Relief Program, or TARP, to target small-business lending.
Todd McCracken: We think that if the federal government is shoveling out huge sums of money to shore up the banks, they need to make sure those banks are making loans where they’re most needed — putting the money back out the door to small businesses and consumers. In addition, they need to be buying up some of these guaranteed SBA Small Business Administration loans.
And regardless of how much more is spent on SBA loans and infrastructure, there’s one simple action that would deliver stimulus right were it needs to go, says Chris Gunn of the American Small Business League.
Chris Gunn: And that’s actually just stopping the diversion of small business contracts to large corporations, providing more oversight within the federal government, supplementing the SBA with an increased budget, and increasing their staffing.
By law, 23 percent of federal contracts are supposed to go to small businesses. Gunn says multiple government and independent investigations have found that around half that work is actually going to big companies instead, through fraud, loopholes, and inadequate oversight.
I’m Mitchell Hartman for Marketplace.
There’s a lot happening in the world. Through it all, Marketplace is here for you.
You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible.
Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.
