Calling All Small Businesses: We Want to Help You…

And regulate you. Despite the fact that many small businesses and legislators did not want it in the first place, President Obama finally signed the $30 billion small business-lending bill today.  Obama said it would save small businesses and promote job growth. The bill comes neatly packaged with tax credits, cuts, and billions of dollars to help banks give loans to small businesses.  But, you better read the fine print.

As the article courtesy of NewsBusters points out, the beginning of the bill clearly states its aim:

To create the Small Business Lending Fund Program to direct the Secretary of the Treasury to make capital investments in eligible institutions in order to increase the availability of credit for small businesses, to amend the Internal Revenue Code of 1986 to provide tax incentives for small business job creation, and for other purposes. 

You read it right, complete government oversight.  There is another stipulation requiring institutions to “Outreach to MINORITIES, WOMEN, AND VETERANS.” The Treasury requires all banks receiving funds to give “appropriate” outreach and advertisement to the minorities, women, and veteran applicants detailing the process of receiving loans. The treasury wants this done though “print, radio, television or electronic media outlets.”  To sum it up, The Treasury wants institutions advertising Government saved the day.

This is the very reason small business and community banks do not want and will not take advantage of the bill. Not only do they have to report everything back to the Treasury, they have to spend time advertising on behalf of the government when they could be using that time to think of ways to expand their business. Bank executives claim their customers have no interest in the loans because they fear a slowed economy and government regulation.  They are right. And given the chance the economy gets better, the Treasury Department is still running the show.

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