Small Business Lending Fund Act of 2010--Resumed

Floor Speech

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Mr. WHITEHOUSE. Mr. President, I thank Senator Landrieu and also Senators MERKLEY and CANTWELL, who spoke before me, for the extraordinarily hard work they have put in to bring us to this moment. This is the culmination of a lot of hard work against what was for a long time unanimous Republican opposition. We couldn't get this done because we couldn't get one vote from a single Republican to help small business through our community banks. Thankfully, Senator LeMieux has broken the ice. Now we are in a position to go forward. There may well still be significant parliamentary maneuvers by the other side to slow it down and delay it rather than have it go smoothly, as it should.

The situation in Rhode Island is pretty dire. We are a small business State, and we have more than 12 percent unemployment. The situation in which that takes place is the one my colleagues have described.

The big banks are hoarding cash. They have been given access to the Treasury, and they are borrowing money at extremely favorable rates, but it is not filtering out. It is being invested for their own account, building up their balance sheets, not getting through to businesses, particularly not to small businesses. The big corporations are hoarding cash. That is putting pressure on employment and on small business.

So for a small business, even if you are profitable, even if your loans to your bank have consistently been performing, the tightening up of credit on the community banks has restricted the funds that are available to even solidly performing small businesses that wish to invest and hire.

The solution for this is a wonderful one that Senator Landrieu, Senator Merkley, and Senator Cantwell recommended, and that is to turn to our local community banks that were not a part of the Wall Street problem and know where the good businesses are. They have existing relationships with them. They would love in many cases to loan to them. They just don't have the capital. So this provision would bring together the capital available from the Federal Government and the expertise of the local community banks to meet the urgent need of America's small businesses. The market for capital has tightened so much that this kind of a mechanism makes a lot of sense. The government loans capital, and there is a fee. It is not giving it away; it is earning a fee, and it frees up additional capital for the banks in turn to loan, the local community banks, to bring their expertise to bear on those businesses. So the bank then loans the capital and it gets out the funds and the small businesses gather funds and from that capital they are able to go out and hire and invest and help to begin to further improve the economic climate.

This is a good idea. It is timely. I hope as we go forward. The good sense that Senator LeMieux has shown and the priority he has put on small business and local community banks is able to sink in a little bit further. Frankly, I wish we had been able to do this some time ago, but the absolutely unanimous blockade from the Republican Party has prevented this.

I will close by saying that having been a party to many of these discussions as the Senator from Louisiana has been keeping us abreast of her negotiations, I know what a long ordeal this has been for her. I know how tenacious the Senator from Louisiana has been on this. She has finally been successful in terms of delivering what is now a bipartisan amendment, and it is a great moment. I congratulate her and I look forward to working with her toward success.

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