Barreto v. Kerry, Snowe, Landrieu et al

[whometense]

I hope you don't mind my breaking this out into its own thread. TayTay posted this link yesterday http://sbc.senate.gov/hearings/109hrgs.html to an incendiary Senate Commerce Committee hearing from November 8 in which a furious JK grilled Sec. Barreto on his pathetic and disingenuous response to the needs of small business owners post-Katrina.

You can read yesterday's exchange here http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=273x62165#62197 starting with TayTay's post #13.

I didn't get to watch until (way too) late last night. I think Snowe, Kerry, Landrieu all deserve medals for not jumping across the table and throttling that toad Barreto. Didn't you just love the way he was trying to yes them along, agreeing with everything?

Well, almost anything. What was that all about with the bridge loans? What on earth was that about? If anyone could explain I'd be grateful. It sounded like none of the senators understood it either. Clearly there seemed to be some kind of collusion between the *ise and the advisory banks, but I couldn't figure out why.

That tape displays * appointees in their full glory. Arrogant, slimy, inept, and slick, all at once.

[TayTay]

1. This is a must-see for people who love to see

LittleClarkie's Angry (Hulk) pic Kerry. That committee hearing was a gem, just a gem.

NewsPress on this: (Remember, the hearing is from November 8th, 2005.)

Only 20 loans given in SBA program
Times-Picayune, The (New Orleans, LA), Sec. NATIONAL, p 04 12-16-2005
By Bruce Alpert Washington bureau

WASHINGTON -- A much-touted Small Business Administration plan to create a Gulf opportunity loan program to help small businesses recover from Hurricane Katrina has generated only 20 loans for $1.4 million in the first four weeks of operation, records show.

The new loans were announced after members of Congress from both political parties complained that the administration was blocking legislation that would create a $450 million bridge loan program to give businesses access to money that could help them with cash-flow problems in upgrading or replacing damaged facilities.

The SBA said the so-called GO Loan program would be non-bureaucratic, with quick loan approvals, administered by banks with the federal government guaranteeing repayment of up to 85 percent of the loans. But SBA associate administrator Herb Mitchell said it has taken time for banks to get comfortable with the new program and lawmakers say their constituents tell them they've been turned off by interest rates running 7 percent and higher.

A half-baked offer

Andrew Ramsey, a partner with Bywater-based Hubig's Pies, said he's pretty much given up on getting help from the agency.

"We haven't gotten any money from the SBA and I don't think we're going to end up with any," said Ramsey, who isn't sure his wind-damaged production facility will be ready in January, as he had hoped. Ramsey said what's helped his company isn't the SBA, but the non-profit, non-governmental Idea Village, which has provided small cash grants to help businesses struggling after Katrina.

Hubig's $5,000 grant has been used to set up a Web site where the company sells T-shirts with the firm's famous pie insignia. "It has provided some cash flow at a time when we really needed it," Ramsey said.

At the rate the Small Business Administration is approving loans, Louisiana Sen. Mary Landrieu said, it will take 114 years to help "the 18,000 businesses that have been catastrophically destroyed in Louisiana alone."

Rep. Bobby Jindal, R-Kenner, has been urging the agency to work with businesses to help them get loans to cover cash flow, something not traditionally provided by the agency. But he said that he's heard anecdotally from constituents that they were turned off by relatively high interest rates and loan caps for the GO Loan program.

Jindal said he hopes that the administration now will consider the stalled bridge loan legislation. "I tell my colleagues that the more we can do to get businesses to open up, the more quickly people can get back to work and ultimately it will mean that we need less help from the federal government," Jindal said.

SBA spokesman Raul Cisneros could not say why the administration continues to oppose the bridge loan legislation, co-sponsored by Sen. Olympia Snowe, R-Maine, along with Sen. John Kerry, D-Mass., Landrieu, D-La., and Sen. David Vitter, R-La.

To date, the SBA has approved more than $1.3 billion in traditional disaster loans designed to help businesses and homeowners rebuild. The agency said that 20,000 homeowners, renters and business owners in Louisiana, Mississippi and Alabama have gotten loans and that the pace of assistance is in line with the agency's performance after two other major disasters: the Sept. 11 terrorist attacks and the 1994 Northridge earthquake.

Working hard

Mitchell said the agency has drastically increased its staff to process loan applications and is working as fast as possible to help both businesses and residents displaced by the hurricane.

But Democrats continue to criticize the agency and its administrator, Hector Barreto.

Rep. Nydia Velazquez, D-N.Y., the top Democrat on the House Small Business Committee, has called on Barreto to resign.

Velazquez said Thursday that in the three months since Katrina hit, the SBA has received 300,000 applications for financial assistance, has turned down 80 percent of all disaster loans and has a backlog of more than 200,000 pending applicants.

The embattled SBA director got a boost Thursday from the Republican chair of the House Small Business Committee, Rep. Donald Manzullo, R-Ill.

"The SBA's response to the horrible catastrophe in the Gulf Coast has been unprecedented, and there is much work yet to be done," Manzullo said. "I have every confidence that Administrator Barreto and the SBA will succeed in delivering billions of dollars in recovery loans in a responsible manner, while balancing the interest of both the taxpayers and the people of the Gulf Coast."

Barreto, appearing at a news conference with Manzullo, said critics are exaggerating the agency's problems.

"I greatly appreciate Chairman Manzullo's efforts to give a true, balanced picture of how the SBA is responding to this year's hurricanes." He said the agency continues to work hard with key partners in the private sector "to help those impacted by these storms."

. . . . . . .

[TayTay]

2. Bridge Loans

From Congressional Quarterly 11/9/05

Barreto announced at the hearing that the SBA would begin a new pilot program to provide "Go Loans." That would allow banks to use expedited, simplified loan procedures. The SBA would provide a guaranty of 85 percent on loans of up to $150,000.

But Snowe, Vitter, ranking Democrat John Kerry of Massachusetts, and Mary L. Landrieu, D-La., said that their package to provide economic assistance to small businesses (S 1807) included $450 million for states to provide bridge loans -- which could be swiftly approved by state agencies to help businesses awaiting SBA loans or other financial help. An earlier version (S 1724) providing $400 million was added as an amendment to the Senate Commerce-Justice-Science appropriations bill (HR 2862), but was stripped in conference.

Barreto said that the administration believes the Go Loans are preferable to the bridge loans, but he supported many components of the bill.

But proponents of the bridge loans argue that they offer more generous terms than the Go Loans, meaning they would provide greater benefit to struggling businesses.

Snowe also pressed Barreto to document for the committee the percentage of federal contract dollars that small businesses are receiving for hurricane recovery work.

"I think they're doing an end run around small businesses," she said of the federal contracting. "Ultimately it's the victims and small business that won't be able to get back on their feet."


***************

Can I just add: Motherf*ckers, please. Honestly, these people have to go. They are just boot-licking toad people.

[ProSense]

4. Seriously,

The SBA has become an obstruction to small businesses. The amount of rejections and backlog has to make one wonder about its purpose. The SBA's only functions seems to be coming up with excuses for turning down loans and throwing up obstacles to drag out the process.

[TayTay]

5. Bingo. This is by plan.

Remember, the Rethug plan is to show that Government is incompetent and to remove all functions but what the Rethugs deem as worthy from the government. I think the SBA is awful by design and on purpose. The Rethugs want to discredit the government as being able to do anything. It's their plan.

[ProSense]

6. The fact is

the SBA scares off banks. The two operate on a parallel track. Most banks will, in a heart beat, give a loan to a small business that has the backing of the SBA. The SBA by dragging out the process also deters the bank from moving quickly on any interim loan. Not exactly the same, but could you imagine if the VA home loan guarantee process worked the same way, and with an 80% rejection rate?

[whometense]

7. That was what I kept thinking about

when I was watching the hearing. A lot of the technical aspects of what they were discussing went whizzing by my head, but what I could see very clearly was that Barreto intended to frustrate, stonewall, and generally infuriate the senators while talking in the balndest, most agreeable, most boring tone of voice imaginable. He had Mary Landrieu so upset she couldn't even enunciate the word "infuriated".

Everyone should watch that hearing, though since the ostensible subject matter is dry, dry, dry I imagine few will. But it was just a perfect display of the tactics this pestilential administration uses to get its way while blithely ruining lives.

[karynnj]

3. Bridge loans are short term loans that are taken for the

period until a long term loan can be start. They are then paid off when the long term financing kicks in.

Many people need them if the buy a house before the sale of theirs goes through. (unless of course you have the full down payment on the second house and the ability to carry both loans - which we didn't)

I assume here that the states and lenders are giving them to business owners, who have the appropriste credit worthiness so they can immediately get back into business.