Senate passes aid to small businesses; bill now goes back to House
Thursday, September 16, 2010; 8:16 PM
The Senate on Thursday passed a long-stalled bill aimed at providing the nation's small businesses easier access to credit, the latest effort to create jobs and boost the struggling economy.
The 61 to 38 vote came just after noon, with two Republicans joining the Democratic majority to give President Obama a legislative victory he has been pursuing for months.
"This bill takes [the] credit crunch head on and helps small businesses access the capital they need through targeted tax cuts, robust incentives for investment and support for entrepreneurship," said Senate Finance Committee Chairman Max Baucus (D-Mont.), adding that the measure would help "get Americans back to work."
The Senate vote sends the legislation back to the House, which already passed a similar measure and is expected to approve the Senate version next week.
Because a key element of the bill would distribute billions to community banks in a position to lend to small businesses, Republican opponents of the bill called it little more than a veiled version of the government's bank bailout fund, the Troubled Assets Relief Program.
"It had the mini-TARP in there, with no real help to small businesses, as far as I'm concerned," said Sen. Orrin Hatch (R-Utah), who voted against the bill.
The aid package that passed Thursday includes about $12 billion in tax relief for small businesses and a $30 billion lending fund that will be administered by the Treasury Department. Those funds would go to qualified small banks that promise to extend new loans to small businesses, many of which have had trouble getting loans in the wake of the financial crisis.
As the economic recovery has slowed and enthusiasm for more aggressive stimulus measures has all but evaporated in Congress, the relatively modest small-business bill became a growing focus for the administration and Democratic lawmakers. The president in recent weeks repeatedly implored Senate Republicans to abandon their "blockade" of the legislation.
The deadlock over the bill broke recently when Sen. George V. Voinovich (R-Ohio) said he would join Democrats to push the legislation through the Senate because the economy was "really hurting." This week, he and Sen. George S. LeMieux (R-Fla.) gave Democrats the votes they needed to overcome the threat of a filibuster. Both men also voted for final passage of the bill Thursday.
"It's the right thing to do," LeMieux said after the vote. "I don't think it's a panacea, but it will help."
Voinovich said he supported the bill because of the many calls of support from small and medium-size manufacturers in Ohio. Still, he blamed Democrats for stalling it, ignoring "legitimate complaints" about the lack of GOP amendments and holding "political votes" on a number of issues. He accused Obama of politicizing the legislation, even as Democrats had put the bill on hold for weeks to deal with other issues.
Even so, Voinovich said in a Senate floor statement, "I felt we could no longer wait to pass this legislation. We needed to do something now to help the economy get going."
Senate Majority Leader Harry Reid (D-Nev.) has called the legislation the most significant legislative effort to aid the economy since the $800 billion stimulus measure Congress passed in February 2009.
He and other Democrats have estimated the new legislation could create as many as 700,000 new jobs. Critics have dismissed that figure, saying that increased access to loans won't cure the central problem preventing many small businesses from hiring and expanding: a lack of consumer demand.