News Flash

Obama outlines aid for small businesses

(Xinhua)
Updated: 2010-02-03 04:14

US President Barack Obama on Tuesday outlined his plan to help struggling small businesses get fund and promote job creation.

In a speech delivered in Nashua, New Hampshire, Obama echoed his State of the Union address last week, funneling $30 billion to local banks so they can lend small businesses money they need to grow their enterprises and create jobs.

"Jobs will be our No. 1 focus in 2010," he said in his remarks, "And we're going to start where most new jobs do -- with small businesses. These are companies that begin in basements and garages when an entrepreneur takes a chance on his dream, or a worker decides it's time she became her own boss."

The $30 billion fund would come from money repaid by big banks that got help from the $700 billion Troubled Asset Relief Program, the vastly unpopular bailout for those on Wall Street whose actions led to the economic downturn. The fund would be open to banks with assets of $10 billion or less.

About 8,000 such small and community banks would be eligible. Small businesses have created roughly 65 percent of all new jobs over the past decade and a half. Besides the fund, Obama was also promoting several other ideas to help small businesses, including calling for tax credits for those small businesses that hire new workers or raise wages, and for eliminating all capital gains taxes on small-business investment.

He also has proposed tax incentives for all businesses to invest in new plants and equipment. The unemployment rate, currently at 10 percent, remains a 26- year high, and is not expected to drop significantly in the coming years. The budget documents forecast a 9.8-percent unemployment rate by the end of this year. Fighting unemployment has become one of the top priorities for the Obama administration.