Obama: Government shutdown will cripple small businesses, slow economic recovery


President Obama delivers remarks at M. Luis construction company on October, 03, 2013 in Rockville, MD. (Bill O'Leary/Washington Post)

In his latest remarks on the government shutdown, President Obama blasted House Republicans for what he called a “reckless” political move that threatens not only federal workers in the nation’s capital, but also small business owners and private-sector workers around the country.

“We have all seen the offices locked down, the monuments closed,” Obama said during a speech at a small asphalt plant in Rockville on Thursday, three days after lawmakers failed to agree on a new spending plan, shuttering the government. “But the impacts of the shutdown go way beyond those things that you are seeing on television.”

For instance, “hundreds of thousands of Americans, a lot of whom live around here, don’t know when they are going to get their paycheck, and that means stores and restaurants around here don’t know if they will have as many customers,” Obama said.

M. Luis Construction, the small roadwork company that owns the plant where Obama delivered his remarks, is among those threatened.

Cidalia and Natalia Luis, the firm’s owners, used a federal loan program to help keep their company afloat during the recession, and in the past few years, they have managed to expand their business and add about 100 new workers — earning praise for the second time in three weeks from the president.

“This story is what America is all about,” Obama said of the Luis sisters, who stood by his side during a speech in the Rose Garden in September. However, the government shutdown is the last thing they need, he said.

“Companies like this one worry that their businesses are going to be disrupted, because particularly in areas like Maryland and Virginia, where there are a lot of federal workers, you don’t know how that is going to impact the economy,” he said Thursday.

“The worst part is, this time, it’s not because of a once-in-a-lifetime recession,” the president added. “It’s happening because of a reckless Republican shutdown in Washington.”

House Republicans have pushed back against the president’s finger-pointing, arguing that the administration has refused to negotiate with them on various funding measures, particularly the health care reform law.

“The president isn’t telling the whole story when it comes to the government shutdown,” House Speaker John Boehner (R-Ohio) wrote in an editorial for USA Today on Wednesday. “The fact is that Washington Democrats have slammed the door on reopening the government by refusing to engage in bipartisan talks.”

Right now, Boehner is reportedly blocking a vote on a Senate-approved measure to fund the federal government for the next six weeks, fearing backlash from the most conservative members of his party. If the speaker green-lighted the vote, Obama said Thursday, the government could be back up and running “in the next five minutes.”

If not, and the shutdown lingers, the president warned that the local economy in and around Washington may suffer the most severe blow. He noted that companies in the region rely on business from federal workers, many of whom will be out of work until lawmakers strike an agreement.

The shutdown may hit small employers from other angles, too. The Small Business Administration, for example, has been forced to stop processing loan-guarantee applications, leaving companies waiting to get their hands on the capital many of them so desperately need.

“Across the country, you’ve got farmers in rural areas and small business owners who deserve a loan but are being left in the lurch right now,” he said. “They might have an application pending as we speak, but there’s nobody in the office to process the loan.”

John Arensmeyer, the president of Small Business Majority, said of the SBA shutdown earlier this week: “It’s just going to impede the recovery we have been seeing, and the last thing small businesses need right now is a hiccup in the credit that has been necessary for them to climb out of the recession.”

The president expressed the same concerns on Thursday.

“We are making steady progress, and the reason I’m here is, we can’t afford to threaten that progress right now,” Obama said.

Follow J.D. Harrison and On Small Business on Twitter.

J.D. Harrison covers startups, small business and entrepreneurship, with a focus on public policy, and he runs the On Small Business blog.

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