THE WHITE HOUSE
Office of the Press Secretary
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EMBARGOED UNTIL DELIVERY
June 11, 2010
Remarks of President Barack Obama—As Prepared for Delivery
With Small Business Owners
Friday, June 11, 2010
Washington, DC
As Prepared for Delivery—
I just finished a meeting with these small business owners and a few of their workers. We talked about some of economic challenges facing these folks. And we talked about the ways our government can make it easier for smaller firms to hire and grow. These men and women know how important that is. Historically, small businesses have created roughly two out of every three new jobs in our country. To replace the millions of jobs lost in the recession, we need to make sure small companies are able to open up, expand, and add names to their payrolls.
But ensuring that small businesses can thrive is about more than our economic success. It’s about who we are as a people. It’s about a nation where anybody with a good idea and a willingness to work can succeed. That’s the promise of America. It’s that promise that has drawn millions of people to our shores. It’s what drives workers to become their own bosses. It’s what propels basement inventors to bring their concepts to market.
It’s what led two guys – Bobby Pancake and Steve Wheat, who are here today – to take a chance and try their hand at actually running restaurants. They worked for a restaurant chain for years, but they decided to leave the corporate offices and open up their own franchises. In fact, Bobby and Steve told me they recently opened up a sixth location. Terry Haney, the general manager of one of their locations, is here as well.
And it’s the promise of America that led Prachee Devadas to come to this country, become a citizen, and open up what has become a successful technology services company. Prachee told me that when she started, she had just one employee. Today, she employs more than a hundred people – including her husband Anand who is here.
But the fact is, small businesses have been hit hard by the recession. From the middle of 2007 to the end of 2008, small businesses lost 2.4 million jobs. And because banks shrunk from lending in the midst of the financial crisis, it’s been particularly difficult for small business owners to take out loans to open up shop or expand. It’s been hard to finance inventories, payroll, new equipment. Now, government can’t guarantee success for these companies. But it can knock down barriers that prevent owners from getting loans. Government can’t create private-sector jobs. But it can create the conditions for small business like those represented here to grow and hire more people. That’s what has guided much of our economic agenda.
Last year, we enacted seven tax cuts for America’s small businesses. So far, the Recovery Act has supported over 68,000 loans to small businesses – nearly $29 billion in new lending. More than 1,300 banks and credit unions that had not made SBA loans since before the financial crisis are now lending again. And more than $8 billion in federal Recovery Act contracts are now going to small businesses. In fact, Prachee has been able to add 20 part-time and full-time workers because of the Recovery Act.
In addition, as a result of a bill I signed into law a few months ago, businesses are now eligible for tax cuts when they hire unemployed workers. Companies are also able to write off more of their investments in new equipment. And as part of the health reform package, 4 million small business owners recently received a postcard in their mailboxes from the IRS. And it was actually good news: it told them that they could be eligible for a health care tax credit this year worth perhaps tens of thousands of dollars.
These and other steps are making a difference. Little more than a year ago, the economy was in freefall. Today, it’s growing again. Little more than a year ago, the economy was losing an average of 750,000 jobs each month. It’s now been adding jobs for five months in a row. But even though we are digging out from this recession, we still find ourselves in a pretty deep hole. Millions of our family members, friends, and neighbors are still looking for jobs – faced with the prospect of long-term unemployment. Credit is still less available than it should be. As small business owners like Prachee and Bobby and Steve will tell you: we may be recovering, but we are not recovered. We have to keep moving forward.
That’s why I’m urging Congress to swiftly approve a set of tax breaks and lending incentives to spur hiring and growth at small businesses. This legislation would eliminate capital gains taxes for investment in small firms, which will help move capital to these companies across America. And it would provide tax relief to small start ups to encourage folks to open up businesses, too.
In addition, to foster more credit, this package would create the small business lending fund I proposed in my State of the Union address – to help underwrite loans through community banks. And we’d create a new state small business credit initiative, because states facing budget shortfalls have had to scale back lending to small firms and manufacturers – working against our recovery. I’m also urging Congress to expand and extend successful SBA programs – by increasing loan limits, for example – something that could benefit people like Bobby and Steve.
The fact is, since the start of my administration, we have been hearing from small businesses that want to retain and hire more employees, but need additional credit. And we’ve been hearing from small community banks that want to lend more to small businesses, but need additional capital. So this bill helps fulfill both needs. And to help us create jobs without adding to our deficit, we are making the tough choices to pay for these proposals.
So I’m hopeful the House will pass these measures next week, and that the Senate will follow as soon as possible – with support from both Democrats and Republicans. And I’m eager to sign this tax relief and additional lending into law. That’s how we can continue to move our economy forward – to continue on the path from recession to recovery, and ultimately to prosperity.
Thank you.
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