The big news from the White House's small business summit yesterday, as reported on television in any case, was that the president is angry—lectern-thumping angry—at the big bonuses going to the AIG derivatives desk. If only he wouldn't take it any more. But we'll come back to that another time.
There was, meanwhile, actual small business news to emerge from the meeting. The new stimulus law permits the Treasury Department to lend money to brokers to buy up pools of Small Business Administration 7(a) loans on the secondary market, thus making money available to small banks to make more loans. Yesterday, the president went further: the Treasury Department will spend up to $15 billion to buy those pooled loans itself. It will also use the money to buy up the bank portion of debt on SBA community development (or 504) loans. The Treasury "stands ready" to purchase loans packaged between July 1, 2008, and December 31st, 2009.
In addition, Treasury Secretary Tim Geithner will require the 21 largest banks receiving bailout money to disclose the amount of small business lending they do each. And he asked the FDIC to amend reporting regulations so that every bank includes small business lending as part of its regular quarterly reports. (Presently small business loans are reported annually.) If the FDIC complies, it will provide a useful: for all the information about lending that's available, we know precious little about how much is actually going to small firms. Which might explain why through 2008, experts were divided on whether there was really a small business credit crunch at all.
Mostly, though, the president simply highlighted provisions of the stimulus that have now taken effect, or will soon. For instance, the SBA has eliminated borrower fees for both the 7(a) and 504 loan programs, as well as lender fees on 504 loans. The fee moratorium will last through the end of 2009, or until the programs exhaust the money Congress appropriated in the stimulus, and are retroactive to February 17th, the day the stimulus became law.
One other noteworthy tidbit from yesterday's meeting: among the invited guests was Dan Danner, who was recently elevated to president and CEO of the National Federation of Independent Business after serving as its longtime chief lobbyist. This was Danner's second appearance at the White House in as many weeks—he also attended the health care summit on March 5th. By contrast, Jack Faris, who headed the NFIB from 1992 until 2006, visited the Clinton White House just four times in eight years, according to this dispatch from 2001.