Hurricane Alert for Small Business

     As everybody knows by now, we have had a major-league wake-up call in our economy over the past several weeks.   First the price of fuel surged to record levels; then the sub-prime mortage market suddenly imploded; then financial institutions began to fail, along with insurance giants and banking institutions.   It is not an exaggeration to say that many of the financial underpinnings of our economy are in full panic mode, and no one knows where it will end.    As I write this, efforts are being made to put together the largest economic rescue plan in history, in an effort to ward off total economic collapse, not only in the United States, but because of the size of the U.S. economy, throughout the world.   What seems clear at this critical juncture is that we have not seen the end of the problem.

     Central to all of this is the availability of credit, the ability of businesses to conduct business, with all sides confident that at the end of the day, all bills will be paid, that services rendered will be properly recompensed, and that investments to provide expansion or improvements will be made possible by confidence that all these risks will yield rewards.   What seems increasingly likely, however, is that the credit, especially for individuals, businesses, and indeed any entity without enormous resources, will be difficult to find.   WIPP members are likely to find themselves in this category.   WIPP laid out its call to action to Congress and the incoming administration in its newly released Economic Blueprint. 

     About a year ago, through WIPP's efforts a bi-parttisan bill was put forward to make it very attractive for individuals to invest in small businesses - who often find credit inaccessible.  Small businesses need this access to capital to fuel their growth.  The bill was tabled because of concerns about an increasing deficit, and the determination to subject any new initiative to a "pay-go" test - that is, any new expenditure had to be offset either by a comparable cut elsewhere, or by new revenues.   Are we now in a new era, an era in which trillian-dollar rescues are needed to avert disaster?   Have we gotten to the point where concerns about deficit spending must yield to the pending emergency?    If the hurricane is approaching, are we not requred to act, before thousands of businesses and jobs disappear in the storm surge?    Is it time to revisit the ACE Act (Access to Capital for Entrepreneurs Act of 2007, or other similar initiatives?   What do you think?