Obama Says Shutdown Is Hurting Small Businesses
As a politician, you can do no better than to embrace a small business. Today, President Barack Obama played that card as he spoke at a Maryland construction company about the damaging effects that the government shutdown might have on small businesses.
Obama visited the loading area for the M. Luis Construction Company in Rockville, Md., this morning where he delivered the latest in a string of speeches aimed at strong-arming the House Republicans to pass a bill to fund the government without the condition that his trademark health-care reform bill be delayed.
"The only thing that is keeping the government shutdown, the only thing preventing people from going back to work, and basic research starting back up and farmers and small-business owners getting their loans, the only thing that is preventing all of that from happening, right now, today, in the next five minutes is that Speaker John Boehner won't even let the bill get a yes or no vote," said a fiery Obama. "He doesn't want to anger the extremists in his party. That's all. That is what this whole thing is about."
The U.S. government officially shut down at the stroke of midnight on Tuesday when Congress failed to pass a spending bill. At the crux of the issue is that House Republicans added an amendment to the funding bill that would delay portions of Obamacare. Senate Democrats refuse to include any changes to Obamacare in the funding bill.
New small-business loans backed by the Small Business Administration are not being processed during the shutdown. "A billion dollars a month goes to small businesses all across the country. Right now, those [loans] can't be processed because there is nobody there to process them," said Obama this morning.
The president delivered his speech at M. Luis Construction, which has been able to grow over the last few years due to the help of SBA programs, according to a statement from the White House. Founded in 1985, M. Luis Construction is both a woman and minority-owned company.
In addition to sidelining government-backed small-business lending, the government shutdown also hits those small businesses that have contracts with Uncle Sam.
"As soon as the government shutdown I suffered an immediate loss of revenue, and depending on how long it lasts, there could be contracts I'm not awarded," said LaJuanna Russell, president of consulting group Business Management Associates in Alexandria, Va., in a separate press conference today. LaJuanna was speaking at an event held by advocacy group Small Business Majority and the National Association of Guaranteed Government Lenders, an industry trade group representing government-backed lending stakeholders.
Russell says the shutdown could mean she'll have to lay people off. "It's appalling that Congress has put me in a position where I might have to fire people. I was just starting to rebuild revenue and regain some confidence in our economy, then this shutdown happened. Congress needs to find a solution now," she said, according to a statement.
Catherine Clifford is senior entrepreneurship writer at CNBC. She was formerly a senior writer at Entrepreneur.com, the small business reporter at CNNMoney and an assistant in the New York bureau for CNN. Clifford attended Columbia University where she earned a bachelor's degree. She lives in Brooklyn, N.Y. You can follow her on Twitter at @CatClifford.