If the newspaper business goes under, The Associated Press might try a second career as a fight promoter.
In a July 27 story following President Obama’s Rose Garden speech, AP released a tiny news brief about Obama’s call to Congress to pass his small business legislation. However, the article devoted two of those four paragraphs hyping arguments between Obama and House Minority Leader John Boehner, R-Ohio.
“Among those present was House Minority Leader John Boehner, who has ratcheted up his criticism of Obama in recent weeks, accusing the president of stooping to partisan attacks and saying Obama cannot sell his economic plan,” AP wrote.
The legislation that the AP didn’t bother explaining was the Small Business Jobs Act (SBJA) which would create a $30 billion Small Business Lending Fund operated by the Treasury Department. The funds would only go to community banks with less than $10 billion in assets and the banks would receive incentives to use these government funds to lend to small businesses.
Essentially, it’s TARP’s baby brother.
But AP was too preoccupied with Obama-Boehner criticisms to discuss the effects the expiring Bush tax cuts would have on small businesses if nothing is done. According to data from The Heritage Foundation, eight percent of small businesses pay taxes at the two highest income levels, but they earn 72 percent of all small business income. They also pay 82 percent of all small business taxes.
Further data from Americans for Tax Reform indicated that 34 percent of sole proprietorships (businesses run by one individual) will face tax increases if the Bush tax cuts aren’t extended.
Curtis Dubay, senior tax policy analyst at The Heritage Foundation, told the Business & Media Institute that lower tax rates make better policy sense than a lending program like the one Obama is promoting.
“Lower tax rates are more equal across the board,” said Dubay. “Only certain small businesses will qualify for loans and loans allow politics to get involved in the selection process.”
Government loan programs from student to mortgage loans are rife with problems yet the media seem content bashing conservatives rather than scrutinizing the lending program.
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