Small business policy recommendations (1)

I don't think small businesses needs help from the government, except to reduce the barriers to starting and operating.  But when I work as a consultant for one of the most important small business organizations in the U.S. I have to come up with a few ideas.  These have not all been used in my client's policy recommendations but you may be interested in the things I recommend:

a) Federal Loan Insurance Corporation

Create a Federal loan guarantee for all bank loans to business for the face amount, for an indefinite period so long as the assets covering the loan have not declined in value. The purpose is to disconnect banking and finance problems from the business world. 

Currently, a small graphic designer gets her loan removed because the bank has lost money in Greek bonds. People lose jobs.  The bank must guarantee the loans to small businesses.

b) Create Small Business Administration Loans on one page

Modest sized loans, secured by assets, for any business with 4 years of Federal Income Tax records should only face a one page loan application form. The current SBA process is burdensome, irrelevant and bureaucratic.

c) Organize a regional start-up clearance center

Regional centers or websites would be helpful to anyone starting a business. The start-up novice could find all the local rules, zoning, fees and regulations that pertain to a new business start-up.  Currently this is a universal nightmare.

This kind of regional center would be similar to what current payroll payment companies do for small businesses: they provide all accounting for payroll that covers the tax issues of all locales.

d) Generate a small business bond market

It might be helpful to have a government insured market for small bonds that are issued on a business to a new buyer on the sale of a business. Such small business bonds would be designed to make businesses easier to sell at the retirement time for the founder.

e) Exempt the sale of small business from any capital gains tax or any tax at all

This policy is designed to help small business owners sell their business. Most small businesses are not sold they are closed and almost everyone loses.