Friday, January 29, 2010
Like many, if not most, of you, I watched the State of The Union speech the other night.
I may have paid more attention when he got around to helping small business. But what he said, didn't exactly make my heart beat faster. Like more money to community banks to (supposedly) loan to small business (supposedly at a nice profit for the banks). We'll see how that works out. And tax credits if you hire new employees or give raises to existing ones. Wonderful. Of course first you have to have the money to hire new employees or give raises to existing ones.
So, having grown up in the Washington area, I have a healthy sense of doubt when a politician says anything. Even -- sorry if this offends you -- one I voted for and would vote for again almost no matter who he was running against. Except maybe Karen.
(Taking me a long time to get to the point, isn't it?)
So here is my idea and I'm not joking about it.
Why not provide however much money ($300 million has a nice ring to it -- didn't Louisiana alone just get that much in an earmark in exchange for supporting the healthcare bill?) for low-interest loans to be made to small businesses only and to be used exclusively for the purpose marketing and advertising?
Yeah, this sounds pretty self-serving, but indulge me a minute. According to the Small Business Administration, small businesses (fewer than 500 employees, although 90 percent of small businesses have fewer than 20 employees) make up a huge part of the economy.
- American small business is the world's second largest economy, trailing only the USA as a whole
- Small businesses employ more than half of all private sector employees
- Small businesses generate roughly half of the US Gross Domestic Product
- Small firms represent 99 percent of all private employers
I could go on, but you get the idea. Small business is an (if not the) engine that makes this country go.
OK, now, Kellogg's and others have attributed increased sales and earnings directly to increases advertising spending. Sorry kiddies, but it freaking works.
So if small businesses had access to low-interest money to use for this (as we know, banks won't loan you money to build your business this way, just if you want to buy new computers or office furniture), there's way more than a reasonable chance that small business could prosper. Or at least not fail for lack of a means to attract customers.
So could the agencies and firms that prepare their ads and marketing materials.
As well as the newspapers, radio and television stations that would run their ads; and web sites that run their Internet advertising.
And printers, photographers, illustrators, freelancers and out-of-work agency people.
OK, call me nearsighted or parochial, but I can't see a flaw in this. Except that maybe $300 million isn't enough. I'll have to ask Mary Landrieu.
It seems to make sense to me. Which, of course, is why the combined Democratic and Republic Brain Trust in Washington will never consider it.