House Republican-led Government Shutdown will Undo Economic Progress for Small Businesses
Statement by John Arensmeyer, Founder & CEO of Small Business Majority, on the pending government shutdown and its significant impact on the small business ecosystem
"The looming federal government shutdown–the result of House Republican dysfunction–is unnecessary and grossly irresponsible. It will severely damage the economic progress that small businesses have made since the pandemic by disrupting essential government activity supporting small businesses and creating consumer uncertainty, negatively impacting small businesses' bottom lines. Whether it's a short- or long-term shutdown, small businesses will pay the price if Congress can't reach a bipartisan agreement on how to fund the government.
During a shutdown, federal agencies like the U.S. Small Business Administration will be forced to close and, therefore, unable to process the loan applications small business owners rely on. Critical lending programs like 7(a), which provides approximately $110 million per day for small business capital needs, will be inaccessible. As a result, small business owners may be forced to seek alternatives, including predatory financing products with high-cost and opaque loan terms.
In addition, a shutdown will impact thousands of small business contractors and their subcontractors, most of which are small businesses. Contracts will be disrupted and payments will be delayed, which will hinder owners’ ability to pay employees on time and even put their businesses at risk of closure.
During our meetings this week with key Administration officials and members of Congress, 30 small business owners from around the country in varying industries shared real-life consequences of a shutdown on their businesses. They expressed frustration with the brinkmanship and concern that consumer and employee confidence will not return if our economy is once again threatened by a disruption to funding and work. ‘We're small businesses. We are only just starting to recover from the pandemic,’ said Mike Roach, co-owner of Paloma Clothing in Portland, Ore. ‘We can't just ask our employees and customers to wait while the government gets it together. The damage is already happening.’
Congress must support the long-term stability of our small business ecosystem and stop the embarrassing political theater that has gripped our federal legislative process. House Republicans must immediately work across the aisle to pass the Senate’s bipartisan agreement to fund the government for 45 days and then work together on a realistic long-term plan to fund the government.”
About Small Business Majority
Small Business Majority is a national small business organization that empowers America's diverse entrepreneurs to build a thriving and equitable economy. We engage our network of more than 85,000 small businesses and 1,500 business and community organizations to advocate for public policy solutions and deliver resources to entrepreneurs that promote equitable small business growth. Our deep connections with the small business community along with our scientific research enable us to educate the public about key issues impacting America’s entrepreneurs, with a special focus on advancing the smallest businesses and those facing systemic inequalities. Learn more about us on our website and follow us on Twitter, Facebook and Instagram.