[Congressional Record Volume 148, Number 1 (Wednesday, January 23, 2002)]
[Senate]
[Pages S21-S22]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




 THE AMERICAN SMALL BUSINESS EMERGENCY RELIEF AND RECOVERY ACT OF 2001

  Mr. KERRY. Madam President, I rise today to speak on the behalf of 
thousands of small business owners across this country who are still 
struggling to keep their businesses open in the aftermath of the 
terrorist attacks. They're having a tremendously tough time paying 
their bills and making payroll, and they need access to affordable 
loans so that they have sufficient working capital as they adjust to 
the market or until business returns to normal.
  Senator Bond and I put forth a comprehensive bill in the last 
session, shortly after terrorist attacks, that addressed not only 
disaster assistance and the worsening credit crunch that has compounded 
the financial problems of small businesses, but also the need for 
business counseling and protection in recovering lost revenue from 
frozen federal contracting jobs. I am talking specifically about S. 
1499, the American Small Business Emergency Relief and Recovery Act of 
2001.
  For the sake of small business owners and their employees, I wish I 
could say that I was here to speak about implementation of this 
legislation. But I cannot. S. 1499, was blocked by the Administration 
and a few Republican Senators. So here I am, at the beginning of 
another session, a new year, and four months after the bill was 
introduced, talking about the Senate acting on emergency legislation as 
small businesses wait for us to do something to help them. I really do 
not know how anyone in this body could stand to go home after Congress 
adjourned and explain to their constituents how we could provide 
billions in loans and grants to airlines, but we could not provide a 
modicum of that assistance to small businesses.
  Republicans holding the bill in the Senate tell me and the press that 
they blocked the bill and still have holds on the bill because the 
Administration has problems with it. The Administration says they have 
problems with the bill because they do not believe there is a credit 
crunch making it harder and more expensive for small businesses to get 
loans. They do not believe we need to provide incentives to stimulate 
borrowing or to encourage banks to make loans to small businesses.
  How can there be no credit crunch when survey results by the Federal 
Reserve reveal that as many as 51 percent of banks have reduced lending 
to small businesses? How can there be no credit crunch when established 
giants like the airlines could not get loans in the post-September 11th 
economy?
  Please tell me how the Administration's priority is an economic 
stimulus package, but the Administration wants us to drop the stimulus 
provisions in S. 1499? What better way to stimulate the economy than 
through business investment and job creation? What is homeland security 
without economic security? They want us to drop the protection for 
small businesses doing business with the Federal Government. And they 
want us to drop incentives making the Small Business Administration's 
loans more affordable for borrowers and lenders.
  Senator Bond and I asked them to meet us halfway, and they said no. 
We asked them to give us alternative language, and they didn't give us 
any. We spent more than 20 hours negotiating on this bill and it 
appears as if the Administration never had any intention of finding 
common ground. It appears as if it was an exercise in delay.
  Let me describe briefly where I disagree with the Administration 
about how to help small businesses battling bankruptcy and employee 
layoffs triggered by the terrorist attacks and economic downturn. The 
Administration believes that all assistance should be

[[Page S22]]

delivered through the SBA's disaster loans, which are administered 
through only four regional offices. From talking to small businesses 
and SBA lenders, Senator Bond and I have concluded that small 
businesses would be better served through a combination of disaster 
loans and government guaranteed loans. Government guaranteed loans are 
almost five times cheaper than what the Administration has proposed, 
have less risk for the taxpayer, and can reach more small business 
owners because they are delivered through more than 5,000 private 
sector lenders who know their communities and have experience making 
SBA guaranteed loans. Our proposal combines public and private sector 
approaches to ensure small businesses nationwide receive the maximum 
amount of assistance.
  The economy was fizzling before September 11th, and small businesses 
were already feeling the pain. To stay financially healthy, they were 
doing their part by cutting back on spending, investing and hiring, and 
the Federal Reserve was cutting interest rates in an attempt to keep 
inflation in check. After September 11th, small business owners across 
this country put on black arm bands. The plug was pulled on their 
business. It didn't matter what state they were in; they weren't immune 
to the ripple effect of grounded transportation, closed financial 
markets, a volatile economy, and lay-offs announced by the tens of 
thousands. Let's start this session off right by passing S. 1499. Let's 
demonstrate that we understand the significance of small businesses to 
the American economy and that we will help them like we have helped 
other industries.

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