Government Shutdown affects Small Business
Will Our Economy Shutdown Too ?
Well into the second week of the current government stall, small business owners and government employees are hoping this doesn’t go another day. In President Obama’s speech on the issue last Thursday, he stated, “We’re making steady progress and we can’t afford to threaten that progress right now.” His oration expressed his concern on the shutdown’s effect on small businesses. He went on to say that the SBA gives a billion dollars a month in loans and is currently halted due to the “…reckless republican shutdown.” According to the United States Small Business Association there are 28 million small businesses in the U.S., which employ 57% of the country’s private workforce, and pays 44% of U.S. payroll.
Imagine being the proud owner of your very own manufacturing company. You are in the process of purchasing your second location and about to receive a loan from the Small Business Administration. The October 1 shutdown has interrupted that loan as the parties disagree over the federal budget. It does not stop there. With Internal Revenue Services closed, many banks join the SBA in a stop on loans. Lenders are unable to check tax information provided by applicants with the IRS not in operation. It is safe to say that businesses with smaller margins and less cash flow are feeling this far more than the major corporations with funds to weather the storm. However, loans are not the only hindering factor in the shutdown. When the government closed its doors, monuments including the Statue of Liberty and Ellis Island in New York, Independence Hall in Philadelphia, the Washington Monument, National Zoo and the Smithsonian in D.C. also stopped operation. When the attractions close, tourism suffers. Surrounding small businesses and restaurants are hurting due to the lack of crowds.
Businesses who rely mainly on government contracts join those being pinched by the party bickering. There is virtually no chance of retroactive pay for the army of furloughed government contractors who provide services that range from safeguarding computer networks and designing military machines, to cleaning offices and doing repairs. Congress has never compensated such employees for time lost during a shutdown situation, the Washington Post reports.
If the video below isn’t evidence of the egregious corruption in the Republican congress, I don’t know what is.
by Mike Watkins