Why are you investing the prestige of your office and the popular support from your home state to wage a war of misconstrued facts on the U.S. Small Business Administration?
Are you purposely trying to block access to capital to thousands of Alabama businesses (and beyond) by glibly
misrepresenting the nature of the agency’s loan guaranty program and secondary market apparatus?
These programs are modeled as credit insurance, meaning that loan losses are entirely funded by premiums (called “loan guaranty fees”) paid by the loan recipients and an ongoing fee (actually a “tax”) levied on the participating bank. Taxpayers don’t contribute a dime toward loan losses.
To say otherwise places you in the unfortunate company with other anti-SBA crusaders like the CATO Institute, whose dislike for SBA leads them to purposely misstate reality.
You were recognized by the NFIB as a “Guardian of Small Business” in 2006. It’s curious that now you criticize the private-public partnership structure of SBA and the secondary market that provides liquidity to participating small business-friendly community banks, including dozens in Alabama.
Calling it a “moral hazard” in Bloomberg Businessweek is ironic. Maybe you have a problem with capitalism on Main Street?
You voted in favor of the Export-Import Reauthorization Act of 2012 for $140 billion, even though about 80 percent of the appropriation benefits Fortune 500 companies Boeing and General Electric.
You voted for ethanol subsidies in 2005, 2007 and 2013, which costs taxpayers over $7 billion annually and benefits other Fortune 500 companies like Archer Daniels Midland, Monsanto, Shell Oil and BP.
Yet now you grandstand over the paltry SBA, whose 2015 budget request actually went down to less than 3/4 of $1 billion, and whose tens of thousand of financial beneficiaries actually pay their own way.
Perhaps you just need a better coach to explain the SBA to you, Senator. As a native of Alabama, I’d be glad to do that. Call me when you’re ready.