Small Business Tax Cuts Bill passes over Republican Objection

Too much for me to read it all right now, but the obvious answer for you Sam is that the Republicans are against everything in the bill that isn't a tax cut. At least that will be the party answer.

 

What I'm hearing from bankers, clients and some in the distressed asset acquistion game is not that banks aren't making loans...but that there's very little demand for those loans, to begin with. People, including small businesses, seem to be deleveraging...and there's not much to gear up for. Construction is in the toilet.

thanks for this thread...I knew this was going down, but I didn't realize there was this much push-back from the GOP

 

This is the best I could find on why the GOP was against the bill.

http://www.foxnews.com/politics/2010/09/16/senate-passes-b-small-business-tax-lending-package/

The loan fund is opposed, however, by most Republicans, who liken it to the 2008 bailout of the financial system. They warn it would encourage banks to make loans to borrowers who aren't good credit risks.

The bill is advancing too late to help lower a 9.6 percent nationwide unemployment rate before Election Day. It follows successful efforts this year to provide a temporary payroll tax holiday to companies that hire the jobless, and to extend assistance to the unemployed, cash-starved state governments and local school districts.

"There are many good things in this bill, but I believe it could have been better," said Sen. Charles Grassley, R-Iowa. "Unfortunately, the Democratic leadership has been more interested in scoring political points than actually providing relief to small business."

Grassley wanted the measure to have additional tax cuts, including a 20 percent tax deduction off their earnings.

 

i don't see how this is really a valid argument for them to use because the loan amount that these businesses are able to receive are limited, and must be repaid within 10 years.

my conclusion for not supporting it? **** if i know.

 

Why doesn't the Federal Government make small business loans available at the same 0% rates they give the banks? It's not like the big banks proved themselves trustworthy for 'low risk' rates?

You can make some money at 0%, maybe over $250,000 a year and then you would pay taxes. Small business is not as likely to stash money offshore either.

If my GP in the oil bidness could get his hands on cheap money, he would do a lot of domestic drilling, in Louisiana. I know that for a fact.

 

Sorry thought my sarcasm was candid enough I'll add a next time!

 

Pretty simple actually, this is a "linguistically and culturally appropriate" small business bill funneled through cherry picked credit unions. Obama the community organizer at it again.

 

"Culturally and lignuistically" appropriate businesses?

 

You don't say!

 

Agreed. Loans are there for small businesses. Profits and record cash levels are there for big businesses. Corporate debt issues are doing just fine.

The problem is simple demand. Until demand picks up, there's simply no reason for businesses to expand. And that will take time - consumers are wisely deleveraging themselves after their experience of what happens when you're too highly levered. This is part of the process of a decade or two of living beyond our means.

 

I only know of my personal experiences, I'm having trouble with my refi despite perfect credit (just low taxable income) and my drilling company (.5% !) is having trouble with normal business loans.

But if the government is giving me money at 0% so I can give it back to them at 2 1/2%, so they can give it back to me at 0%, I'm going to use every every nickel to churn the volume. There is no risk involved at all.

And for the government it makes it look like a healthy market for Treasuries. Which will probably be sold off to investors, and will probably be end up being worthless when the inflation of an increased money supply shows up, meaning the relative value of the national debt goes down.

Win for banks/win for politicians. You lose again.

 

really interesting. very different from what i'm hearing...but admittedly, that's antecdotal and it's only here in Texas, really.

 

agreed...it's a 10 year process..we've got about 7 to go, honestly.

but companies seem flush with cash. they're just not doing much with it.