Small Businesses Find Chamber, Lobby Allies Mute on $30 Billion U.S. Aid

Bloomberg:

Small U.S. businesses pushing for a $30 billion federal lending fund are making their case without the support of some supposed allies: Washington lobbying groups that say they represent small businesses.

Three of the largest groups -- the U.S. Chamber of Commerce, National Federation of Independent Business and National Association of Manufacturers -- were mostly silent during a debate last week over an amendment authorizing the fund, which cleared a legislative hurdle late July 22. A final vote is planned for this week.

The neutrality of these organizations, which together spent more than $47 million lobbying in the first six months of this year, left car-parts makers, franchise owners and community banks on their own to argue for the funding.

“Credit is a terrible problem” for small businesses, said Fred Knapp, president of the South Carolina Small Business Chamber of Commerce, which is based in Columbia. “These groups are tied to big businesses. That’s all this is about.”

Knapp’s group, which is nonpartisan, isn’t a member of the U.S. Chamber of Commerce and broke with the manufacturers’ and independent business groups to support health-care and Wall Street legislation this year.

For the past month the Senate has debated a bill meant to help small businesses get the capital they need to expand and hire workers. The measure would ease terms for loans guaranteed by the Small Business Administration, provide $12 billion in tax breaks and issue grants to states to provide business loans.

$30 Billion Amendment

Its passage is crucial to boost employment because small businesses hire most workers, President Barack Obama said.

“I hope we can now finish the job and pass the small- business jobs plan without delay and without additional partisan wrangling,” Obama said at the White House July 23.

The previous night, the Senate voted 60-39 to proceed with an amendment offered by Louisiana Democrat Mary Landrieu that would provide $30 billion to banks with less than $10 billion in assets to encourage them to lend to small businesses. The cost of paying back those capital infusions would decline based on the level of small-business lending by the bank.

A second vote on that amendment is necessary when the bill comes up for a final debate this week. Landrieu, chairman of the Small Business and Entrepreneurship Committee, called it the most important part of the legislation.

“This is really the core of the small-business bill,” Landrieu said on the Senate floor before the vote. “But for some inexplicable reason this was going to be left on the cutting room floor.”

Posted via email from Jim Nichols