Obama Administration Considering Extending Bailout to Small Businesses
Initiative would take money from the $700 billion program for the banking system and make it available to millions of small businesses, a striking
shift from the rescue program's original mandate.
"A proposal being floated by senior Treasury Department officials calls for using the bailout funds to expand a government program that helps small companies borrow from banks at low rates to keep their businesses going, the sources said. These "working-capital" loans would come with few restrictions and could be used to buy inventory, hold on to employees and pay off short-term debt.
The initiative would bulk up the Small Business Administration's most popular lending program, called 7(a). Lines of credit for small companies could greatly increase in size. If a firm failed despite receiving this help, the government would cover most of the losses on the federal loan, perhaps as much as 90 percent. Lines of credit act like the credit cards for companies -- short-term, revolving debt used to pay a variety of immediate expenses.
The scope of the Troubled Assets Relief Program, or TARP, has been expanded several times already, first to save General Motors and Chrysler and then to help life insurers. In both cases, government officials argued that emergency assistance was critical for preventing economic upheaval. Making the bailout funds available to millions of small businesses would be a far more dramatic expansion."
【 在 Faith (faith) 的大作中提到: 】
: Obama Administration Considering Extending Bailout to Small Businesses
: Initiative would take money from the $700 billion program for the banking system and make it available to millions of small businesses, a striking
: shift from the rescue program's original mandate.
: For more information, visit washingtonpost.com
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