Taking A Closer Look At President Obama's Small Business Track Record
As a reader of Exabyzness you are well aware of how Presidential candidates, and politicians in general, make an effort to argue how what they have done and plan to do are helping small businesses prosper. Further, whenever confronted with the facts that small business owners are not doing so well the blame is immediately shifted to the oppositions past and planned actions. With respect to the President on these issues, he is out and about in Florida currently informing local small business owners of how he has helped them during his time in office and how he plans to help them going forward. Naturally, many on the opposition have questioned his claims that his past actions have benefited small businesses and declare that is reason for a regime change. This back and forth will continue no doubt right up until Election Day but let’s now look at some of the facts available on President Obama’s small business track record. Other than tax breaks and tax cuts—which will be addressed in a separate post—the administration’s biggest effort to help small businesses has been on the lending front, reports the Washington Post. They continue, “since the beginning of the recession, loans to small businesses have dropped because banks have been more reluctant to lend. Obama has tried to come up with new ways to tackle the loan access problem, most prominently through the Small Business Lending Fund. But the fund hasn’t provided the major boost originally anticipated.
In 2011, the outstanding loans to small businesses—defined by the FDIC as having a balance of $1 million or less—reached its lowest volume in five years, according to FDIC figures cited by the Small Business Administration. The trend continued in the first quarter of 2012, when loan balances for small businesses and farms declined by $10.8 billion—faster than for businesses overall. Obama took steps to encourage banks to address this problem through the SBLF, which Congress passed as part of a 2010 bill. There were high hopes for the fund, which was authorized to give out as much as $30 billion in loans to banks for small businesses financing. But the program has since fallen short of expectations. After taking nine months to begin its first loans, “Treasury funded just 332 of the 935 applications, investing about $4 billion” of the funds, according to the Government Accountability Office. Overall, “the SBLF’s $4.0 billion in financing represents less than 0.6% of outstanding small business loans,” CRS explained in February…”
Source - Washington Post