Based on the tepid response of the small-business community to a Small Business Administration loan program announcement from the Obama administration, I'm guessing many in the small-business community are reminding themselves of the old adage "don't look a gift horse in the mouth." They are biting their tongues to keep from saying, "Um, thanks, but that's not what we really wanted." Because saying that would be ungracious. Even if it is...true.
It is also true that there is much left to be done on the economic agenda when it comes to small business. The White House and Congress definitely should not consider this month's "gift" sufficient or too quickly check the small-business box on their "help-the-economy" to-do list.
The small-businesses community should absolutely continue to ask for the things that will help it retain and create jobs, and the White House and Congress should listen very closely to what it is that small business really wants and needs—like tax relief and more affordable healthcare. With small business traditionally responsible for the majority of new-job creation in this country, our economy may depend on it.
I don't mean to imply that access to capital isn't important to entrepreneurs. It certainly is. The president's SBA loan initiatives certainly won't hurt small firms and will likely help some of them.
But the administration and the Hill should listen to the silence.
For example, note that the nation's largest and most influential small-business advocacy group (the National Federation of Independent Business or "NFIB") was silent on the administration's announcements. I suspect this is because the NFIB knows that SBA loans are pretty far down on the small-business wish list. It also knows that the Small Business Administration is an institution that arguably benefits banks (by taking most of the risk out of lending to entrepreneurs—who are already quite a good risk, actually) much more than small firms.
NFIB knows that 90 percent of small firms have never even used an SBA loan.
As pretty much any small-business owner will tell you (you might ask your hairdresser, favorite local restaurateur or, yes, Joe the plumber), problems like high taxes on business income, the cost of health insurance, and the burden of government regulations far outrank problems with access to capital—even in a challenging economy.
A late-2008 NFIB National Small Business Poll revealed that one third of small-business owners thought that the nation's financial problems had "significantly" affected their business and one quarter (26 percent) thought those problems were threatening their survival, but they did not identify access to capital as a leading cause of that impact. The poll found that "45 percent designate slow or lost sales as their principal immediate problem, followed by the unpredictability of business conditions (23 percent), falling real estate values (9 percent), and only then an inability to obtain credit, tight credit drawing virtually the same number of cites as the real estate value issue."
That's right. Read it again: "...only then an inability to obtain credit..."
Which means that the president's gift to small business is not the horse they most wanted.
Now, the small-business community is too polite—and too busy running businesses!—to point this out. And that's fine. As long as it doesn't allow the White House and Congress to hush it the next time it asks for a break.
The real risk of this lukewarm good news for the small-business community is that government officials will say "no, we already took care of you," when small business reminds them that the best gifts that government can give small firms are, always have been, and remain: 1) policies that will lower the cost of health insurance, 2) lowering tax rates on business income, and 3) reducing the burden of government regulations.
I'm sorry to break it to those who look to government for solutions first, but small-business owners, in general, don't give a hoot about the SBA or how much the government is covering the behinds of banks. They just want to be given more freedom, more room to do what they do best: create jobs and grow the economy.
Corrected on : Jean Card is a freelance writer living in Alexandria, Va. She is a former cabinet-level speechwriter and has worked at both the SBA and the NFIB.