Bailout isn't helping out the little guy
Congress will grill the Treasury today on what small business is getting out of the $700 billion bailout. Mitchell Hartman reports for some small businesses, things have gotten worse since the financial bailout began.
Eyes of U.S. Treasury Secretary Henry Paulson (Karen Bleier/AFP/Getty Images)
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Scott Jagow: Today, Congress will grill the Treasury on what small business is or is not getting out of the $700 billion bailout. Again, nothing as far as we can tell. From our Entrepreneurship Desk at Oregon Public Broadcasting, Mitchell Hartman has more.
Mitchell Hartman: Small-business owners like Bret Wingert haven't been having an easy time of it. He's a former aerospace engineer who went into the fancy tea business a few years ago.
Bret Wingert: What was difficult before is really impossible now. Even just simple business credit card limits being reduced. Home lines of credit are also being shrunk.
Wingert's actually selling lots of tea these days at his two shops in Phoenix, and he was hoping to open a third by Christmas. But that plan's dead in its tracks.
Michael Christoff works with folks in much worse shape. His company, Omni Financial, helps business owners pay off their overdue tax liabilities.
Michael Christoff: Small businesses aren't able to get the financing that they were six months ago.
Christoff says, if anything, the credit crunch has gotten worse for small business since the bailout began.
One economist I talked to agreed, saying credit is flowing again at the top of the pyramid with big banks lending to other big banks. But it hasn't trickled down to the little-guy economy yet.
I'm Mitchell Hartman for Marketplace.
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From Austin, TX, 11/22/2008
I wonder if there is any consideration of those who have already been foreclosed? Their credit is shot, and they cannot get credit, even small amounts. They cannot get decent housing without a large down payment, and they cannot even get a car. Perhaps some cash assistance in the form of deposits for securing leases, or even as down payment on things like cars could be important in the process of stimulating the economy, at the level of the consumer.
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