Senate approves Obama’s small-business aid package
WASHINGTON -- Overcoming months of gridlock, the Senate approved a small-business bill on Thursday that handed President Obama an election-year victory but showed just how difficult it had become for lawmakers to agree on the best way to help the sluggish economy and create jobs.
The measure passed by a 61-38 vote, with just two Republicans crossing party lines to support the bill, which would create a $30-billion small-business lending fund and provide $12 billion in tax breaks to help companies invest and hire. The bill now heads to the House, where it is expected to pass swiftly.
Yet the months-long impasse over the bill to aid small businesses, which have been hard hit during the economic downturn and are championed by both parties as engines of the recovery, highlights the partisan divisions before the fall midterm election.
“It tells you the depth of the gridlock and dysfunction that unfortunately has gripped the Congress,” said Sen. Evan Bayh (D- Ind.). “Hopefully, some of that will abate after the election.”
The bill enjoyed bipartisan support at the outset, but the addition of the $30-billion small-business lending fund to give credit-starved firms access to capital created insurmountable partisan divisions. Republicans quickly opposed the lending fund as a “mini-TARP” -- reminding voters of the unpopular Troubled Assets Relief Program that was the cornerstone of the 2008 federal bank bailout.
Republicans filibustered in July, demanding the chance to offer more amendments -- including those unrelated to the legislation. Democrats shelved the bill as the debate dragged on and other legislation took priority.
Those expected to champion the bill from the business community -- the U.S. Chamber of Commerce and the National Federation of Independent Businesses -- instead focused on using the legislation as a vehicle to overturn an onerous business reporting requirement in the new healthcare law.
“All of a sudden it became a partisan exercise again,” said Sen. Orrin Hatch (R- Utah). “It’s amazing to me how difficult it is to work together around here, even when we want to. It’s almost like an arrogance of power: We’re going to teach those Republicans.”
Republican Sen. George LeMieux of Florida and Sen. George Voinovich of Ohio, neither of whom are seeking re-election, joined 57 Democrats and two independents to pass the measure.
The House passed a version of the bill earlier this year, and at one point over the summer, frustrated House lawmakers walked across the Capitol to stage a quiet sit-in at the Senate chamber to protest the delays on this and other jobs bills.
“While I am grateful for this progress, it should not have taken this long to pass this bill,” Obama said on the eve of Senate action. He has promised to sign the legislation quickly.
The bill offers $12 billion in tax breaks to businesses to encourage investment, entrepreneurship and hiring.
Businesses also would be able to write off more of their costs of buying equipment or making shop improvements. Those who are self-employed could deduct healthcare costs from the self-employment tax. The bill would also continue to waive Small Business Administration loan fees that had been cut as part of the 2009 recovery package.
The $15-billion cost of the bill is offset by closing tax loopholes and increasing tax-reporting requirements and penalties.
Democrats estimate the legislation could create 500,000 jobs.
Amendments earlier in the week sought to lift a much-criticized healthcare tax reporting requirement that both Democrats and Republicans agree needs to be fixed. But the amendments failed as senators could not agree on a way to recoup the $17 billion in revenue that would be lost by doing away with the provision.
Republicans also made two procedural moves on Thursday to attach tax credits for research and development and biodiesel development, but both were rejected.