Mr. President, this is National Small Business Week. This country has nearly 27 million small businesses in this country, and their contributions to our economy are indispensable. They create the majority of our jobs, drive our economy, and are part of the solution to lead us out of economic downturns.
But if we’re to truly honor our small businesses, we need to do more than provide lip service and promote policies that favor big businesses under the guise of helping small ones.
In the Committee on Small Business and Entrepreneurship, we’ve worked on behalf of small business on a bipartisan basis. Senator Snowe and I passed unanimously out of Committee three bills to improve small business services that help America’s job creators expand their payrolls. Unfortunately, Mr. President, these bills have been blocked for full Senate consideration for almost one year:
- S. 1256, the Small Business Lending Reauthorization & Improvements Act of 2007, and
- S. 1662, the Small Business Venture Capital Act of 2007, and,
- S. 1671, the Entrepreneurial Development Act.
S. 1256, the Small Business Lending Reauthorization and Improvements Act of 2007, passed the Small Business Committee 19 to zero on May 16thth, 2007, almost one year ago. This legislation reauthorizes the Small Business Administration’s major lending programs, which are the largest source of long-term capital for small businesses in this country. The bill also strengthens the microloan program, a concept that has proven extremely effective around the world in helping men and women lift themselves and their families out of poverty by accumulating assets and building wealth. That’s important because there’s a big gap in this country, getting bigger every year. When an average white family’s net worth is $67,000 but an average African American family’s is only $6,100, we still have a long way to go.
SBA loans fill in a gap left by the traditional bankers and play a significant role in meeting the capital needs of business owners in underserved areas. Mr. President, if S. 1256 is enacted, we will be able to leverage $87 billion in loans to more than 100,000 small businesses and reduce red tape for borrowers and lenders.
S. 1662, the Small Business Venture Capital Act of 2007 passed the Small Business Committee 19 to zero on June 26thth, 2007. Ten months ago. This bill would simplify the Small Business Investment Company Debenture program so that it is more attractive to investors and allow the SBA to stabilize losses in the SBIC Participating Securities program. The version of the bill we are trying to pass does not reauthorize the SBIC Participating Securities program, as some in the past have suggested in public debates and used as one justification in opposing our efforts to pass the bill in December. The bill focuses on improving the SBIC Debenture program, an initiative that has given us powerful job creators like FedEx and Intel and Calaway Golf.
In addition, S. 1662 reauthorizes the New Markets Venture Capital program. This program addresses the market gap in venture capital for companies located in low- and moderate-income rural and urban areas (high unemployment areas), as well as the need for smaller deals that neither traditional venture funds nor the SBIC program will make. It has proven very successful so far and we need more community development venture capital to create sustainable, high-quality local jobs throughout the country. This bill would allow the SBA to start anywhere from 10 to 20 more funds. Without this government partnership, these investments would not be done. The bill also aligns the New Markets Venture Capital program with the New Markets Tax Credit program, as Congress intended, by adopting its definition of low-income community and targeted populations.
S. 1671, the Entrepreneurial Development Act, passed the Small Business Committee 19 to zero on June 26thth, 2007. Also 10 months ago. The Entrepreneurial Development Act reauthorizes and improves the Small Business Administration’s entrepreneurial development programs, such as Small Business Development Centers, Women’s Business Centers, and SCORE. Poor management decisions are the number one reason that businesses declare bankruptcy. In a shaky economy, the topnotch counseling provided by these services are critical to ensuring that small businesses survive this downturn and continue to provide jobs and income to families and communities.
This bill also increases assistance for small businesses wishing to conduct trade. Small businesses are 97 percent of all exporters, and, for each additional $70,000 in exports generated, one additional U.S. job is created. And these jobs pay 18 percent more, on average, than non-trade-related jobs. Small business success helps the economy and creates jobs. Lastly, this bill creates a number of pilot programs to helps small businesses deal with rising health care costs and regulatory burdens, which hinder small business success. It also creates new programs in support of Native American entrepreneurship, and takes steps to improve small business ownership by minorities in highly skilled fields such as engineering, manufacturing, science and technology, and guide them towards entrepreneurship as a career option.
These bills could help more than 1 million small businesses, with credit, venture capital, or counseling. It makes no sense to block them when our economy needs the innovation and hard work of our small businesses more than ever. With 80,000 jobs lost in March alone, and almost 300,000 since January, there is no time to waste. Let’s get these bills done. Blocking them only hurts America’s small businesses and our economy.