October 22nd, 2009
02:10 PM ET
9 years ago

Stimulus debate heats up as Pelosi pushes aid for small business

WASHINGTON (CNN) - House Speaker Nancy Pelosi said Thursday that Congress is set to consider a measure increasing the amount of money the federal government can loan to small businesses.

The House of Representatives will debate a bill next week increasing the ceiling on Small Business Administration loans from $2 million to $5 million. The bill, backed by President Barack Obama, also would increase the maximum size of SBA-backed microloans from $35,000 to $50,000.

On Wednesday, Obama unveiled a separate measure designed to stimulate small business growth in part by making capital cheaper for community banks.

"Small business is the engine of job creation and capital creation in our country," Pelosi told reporters Thursday. "The issue of jobs is (always) important to us."

The moves highlight a growing debate in the White House and on Capitol Hill over whether to push for a second economic stimulus package. The unemployment rate has continued to climb in recent months, and is now near 10 percent.

Most top Democrats refuse to refer to any new measure as a "stimulus," partly out of concern that it will raise questions about the effectiveness of the $787 billion recovery package enacted in February.

Republicans have slammed February's package as a failure.

"We do not have plans for an additional stimulus package," Pelosi said Wednesday. "But we do have plans to stimulate the economy in the ... work that we are doing here."

Yesterday, House Democrats convened a forum of economists to debate the state of the economy, with a specific focus on job creation. Mark Zandi, chief economist of Moody's Economy.com, warned that the "possibility of the economy slipping back into recession next year (is) uncomfortably high."

The measure is only one of an array of new measures being floated by White House and congressional leaders.

Among other things, Congress is currently working on legislation to extend unemployment benefits. An estimated 1.3 million jobless workers will have run out of their benefits by the end of the year, according to the National Employment Law Project.

The House has already approved an extension. The Senate has amended the bill, but not yet voted on it. Both parties say they want to extend benefits but disagree over how to pay for it and how to handle amendments to the bill.

In the Senate proposal, unemployment benefits would be extended by up to 14 weeks in every state and then another six weeks on top of that in states where the unemployment rate tops 8.5 percent. Senate Democrats say the measure, projected to cost $2.4 billion, would be paid for by extending an add-on tax for employers under the Federal Unemployment Tax Act.

The administration is also backing an extension of the federal subsidy now offered to unemployed workers who opt to continue their health insurance coverage from their former employers under what is known as COBRA.

Under the original provision passed in February's economic recovery act, the government agreed to pick up 65 percent of the cost of COBRA premiums for up to nine months for workers laid off between September 1, 2008, and December 31, 2009.

Obama has also proposed sending a $250 economic relief payment to seniors, veterans and the disabled to compensate for the fact that there will be no cost-of-living adjustment made to Social Security benefits in 2010 due to a lack of inflation.

The $13 billion measure would be identical to a $250 emergency payment sent out earlier this year.

Democrats also are looking at a possible extension of the $8,000 tax credit for first-time home buyers. The credit - aimed primarily at individuals making under $75,000 or couples earning less than $150,000 - is set to expire November 30.

–CNN's Dana Bash, Catherine Clifford, and Jeanne Sahadi contributed to this report.

Filed under: economic stimulus • Nancy Pelosi
soundoff (31 Responses)

    when will they realize that government spending will not turn the economy around? Another 531,000 newly unemployed for the week ending Oct 17. It doesn't seem like the stimulus is working, but don't tell Obama that, unless you want to wind up on the enemies list for speaking the truth. Fascism is coming back in a big way.

    October 22, 2009 02:13 pm at 2:13 pm |
  2. shucks

    This is what the republicans have been screaming about for months. Now that the democrats are acting on it, it will be demonized by the republicans at every turn. They are truly a sick bunch.

    October 22, 2009 02:16 pm at 2:16 pm |
  3. ran

    Now we will see were the Republicans really stand.

    Money for small business. Increase in jobs for the people.

    Lets see how the Republicans obstruct this.

    October 22, 2009 02:17 pm at 2:17 pm |
  4. Gary's Opinion

    Nancy, stop spending money that we don't have....you are wasting our money and then going to come back and tell me that you have to raise our taxes....no more stimulus, no more pork, the economy will recover on its own!

    October 22, 2009 02:17 pm at 2:17 pm |
  5. Randolph Carter

    How about repealing NAFTA? How about heavily taxing businesses and companies that outsource overseas? How about revoking all H1B visas? How about legalizing, regulating and taxing marijuana? Just throwing a couple of ideas out there. Have a nice day!

    October 22, 2009 02:22 pm at 2:22 pm |
  6. Grrr-awful-o

    It'll be so refreshing to see Nancy Pelosi leave office. I'm tired of all of her double speak and arm twisting. Nasty Nancy...

    October 22, 2009 02:28 pm at 2:28 pm |
  7. Bedtime for Obonzo

    Pretty soon we won't even need banks with all this federal largesse. Come to think of it, we won't need banks when we have no economy left.

    October 22, 2009 02:34 pm at 2:34 pm |
  8. Will Obama be the 10 trillion dollar man

    Take a loan from the government and the they will want to regulate your pay.

    October 22, 2009 02:36 pm at 2:36 pm |
  9. Pee Wee

    She continues to be just one neuron shy of a synapse.

    October 22, 2009 02:37 pm at 2:37 pm |
  10. Michael M, Phoenix AZ

    Ya think Big Business and their paid lackeys in Congress will go for this?

    October 22, 2009 02:38 pm at 2:38 pm |
  11. Wheat

    Where will this money come from?

    October 22, 2009 02:40 pm at 2:40 pm |
  12. victim of republican greed

    It is time to help small businesses instead of throwing money at the 'too big to fail' companies.

    October 22, 2009 02:41 pm at 2:41 pm |
  13. victim of republican greed

    I am sure the Maoists at Fox and the wingnuts are not going to be happy with this.

    October 22, 2009 02:42 pm at 2:42 pm |
  14. Bob in Pa

    This is where the stimulus money should have gone in the first place. Kill the remainder of the first bill and lets do something right Nancy !!!!!

    October 22, 2009 02:47 pm at 2:47 pm |
  15. Randolph Carter, I'm no economist but.....

    Looky here. It's the top ten companies employing H1B visa holders:
    1 Infosys
    2 Wipro
    3 Microsoft
    4 Tata Consultancy Services
    5 Satyam Computer Services
    6 Cognizant
    7 Patni Computer Systems
    8 IBM
    9 Oracle Corporation
    10 Larsen & Toubro Infotech

    I know a real easy way we could create a lot of jobs for the huge numbers of unemployed American computer professionals. Care to guess what it is? Have a nice day!

    October 22, 2009 02:51 pm at 2:51 pm |
  16. Gail Centre, AL.

    This administration can't agree on anything, They don't disappoint me, I knew as well. Spend, Spend Spend. They are sickening. They haven't a clue on how to fix anything. They just keep pouring money into everything and hoping something works. You would think with all the czars around Obama they all could come up with something. I think Obama is surrounding himself with the wrong people. We could delete all the Czars salaries, and put that money to better use.

    October 22, 2009 02:53 pm at 2:53 pm |
  17. New Day

    What happened?!?!?! This story has been out all day and Boehner and Cantor haven't come out to complain about how this bill would ruin America, yet. Awwwwww, they must be tired... ...complaining all the time can be quite exhausting.

    October 22, 2009 02:55 pm at 2:55 pm |
  18. EG Berlin

    Pelosi, be sure to also include Obama's promised $250 each for me and my spouse, so I can contribute $500 to the RNC.

    October 22, 2009 03:08 pm at 3:08 pm |
  19. Rose

    It's about time, that is what should have been done from the begining.
    Instead of too much focus on "HIS" health care bill, jobs should have been number one. If he had focused on jobs first, many people would not have lost their health care coverage in the first place. His priorities are backwards.

    October 22, 2009 03:08 pm at 3:08 pm |
  20. Victim of Democratic Greed

    Botox Babe knows nothing about running a small business. We don't need loans (unless we don't have to pay them back) WE NEED WORK, CUSTOMERS, BUSINESS. Giving us more money when our income is down is not the answer. Democrats are placing more Burden on us small business owners by extending unemployment benefits at our expense. Requiring health care at our expense. They just don't get it.

    October 22, 2009 03:14 pm at 3:14 pm |
  21. Travis

    Just keep taxing Pelosi. I'm sure everything will be fine.

    October 22, 2009 03:15 pm at 3:15 pm |
  22. Greg, MN

    I thought Obama's spendulous plan was working wonders? It was passed in 20 minutes, weren't small businesses included in that fix all miracle bill? Maybe we can just tack this on to the health care reform bill so small businesses can afford to by into the public option.

    October 22, 2009 03:16 pm at 3:16 pm |
  23. fiscally responsible

    Have the democrats told us how they will fund this?

    October 22, 2009 03:19 pm at 3:19 pm |
  24. File under "Sarcasm"

    It's a great idea Nancy, give small business the ability to borrow more money in loans. They'll need it to pay their increased taxes when the Bush tax cuts expire.

    Oh, I forgot, according to you, “It isn't a tax increase. It is eliminating a tax decrease that was there.” (The fine art of political double speak.)

    October 22, 2009 03:22 pm at 3:22 pm |
  25. JGB

    Get a clue, loaning money is not the answer. sure take the loan and then close your doors. Haven't these people learned anything about money, you don't borrow what you can't pay back? Democrats are NOT business friendly and every business person knows it. Try doing business in California, they think we are their personal ATM machine when times are good, why do you think California is broke, times are not good anymore.

    October 22, 2009 03:23 pm at 3:23 pm |
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