In his December 12 weekly address, President Obama continued to point out the failures of financial institutions and their leaders, and once again lamented that so many small businesses have closed their doors over the past several months. He also expressed his intention to push banks to give small businesses access to lending “they desperately need to grow.”
Several news organizations, including the Wall Street Journal, are reporting that today, Obama will meet with a group of top bankers in an effort to encourage them to extend more credit to small businesses. Obama is said to be urging banks to loosen lending restrictions in part by leveraging the financial help the federal government gave banks to save them earlier this year.Obama is quoted as directly addressing this issue last week during a speech in in Allentown, Pa.:
“Look, you have a responsibility now, now that we have pulled you back from the brink, to help make sure that Main Street is actually getting the kinds of loans that it needs.”
I am glad Obama is putting pressure on banks to voluntarily do the right thing, and I hope it results in some businesses getting the funding they deserve and desperately need. But I don't think the banks will listen much. Why should they? Following their awful behavior, they got a “no strings attached” bailout. I hardly think they are likely to have a sudden attack of conscience now, even if digging in their heels means defying the President of the United States.
But even if banks do have a change of heart, money is not the answer to all of Main Street's problems. While lack of funding can strangle a small business, so too can overly burdensome regulation and government red tape.
As small and independent business owners, we must tell Obama that we expect him to urge both houses of Congress not to pass one-size-fits all laws that treat tiny businesses like multi-billion dollar worldwide corporations.
Obama ended Saturday's address by saying that America must reward hard work, responsibility and competition. But meaningful competition must also be fair, and one-size-fits-all laws create an un-level playing field that is decidedly unfair.
While the money Obama will be discussing today is an issue, so too are pending laws, including the FDA Globalization Act of 2009, that threaten to hamstring small business owners's ability to grow in the midst of the worse economic disaster in decades. Even if a small business is lucky enough to get a loan, all the funding in the world means nothing if it has to be wasted unraveling unnecessary government-imposed red tape. It's happened with the Consumer Product Safety Improvement Act of 2008. If we don't speak up, it will happen again.
Question: What do you need more? A loan or the ability to run your business free of unnecessary government regulation?