Clinton offers ideas for lending, small business growth

6/29/2011

As part of his Global Initiative, former President Bill Clinton will convene in Chicago on June 29 and 30 in an attempt to generate new ideas for job growth in America.

Clinton and a variety of other speakers will cover topics such as education, green buildings, healthcare, manufacturing, rural development, service corps, workforce training, smart infrastructure and small business growth, according to the Chicago Tribune.

To facilitate the discussion on small business, Clinton chose a variety of successful startups with the intention to produce strategies and goals for growth, Inc. magazine reports. The companies with the most compelling business models were chosen to participate.

BabbaCo, a company Clinton calls "the Netflix of parenting solutions," will attend the meeting. Accompanying them will be energy monitoring service Power2Switch, student attendance service TruantToday, social health planner Wellthy, and search engine for renters RentSavvy.

"Obviously, it’s a huge honor," Mike Ivey, RentSavvy co-founder, tells the Dallas Morning News. "I don’t fully know what to expect. I hope to get exposure, real knowledge from industry leaders, contacts and leads for our funding round."

Clinton told the magazine that small businesses have to become immediately branded in terms of their product, and sell at a competitive price. "We want to bring people that are doing this well, and put them together with experts who can accelerate business even more," he added.

Also attending the panel discussion will be former Clinton Administration Chief of Staff and head of the Small Business Administration Erskine Bowles. In the early 90s, Bowles was responsible for reducing bank decision-making on small business loans from 10 weeks to three.

"A lot of small businesses need credit at affordable rates," Bowles told the news source. "I think there might be ways to get the SBA and other financing entities involved in this meeting to help accelerate the capital faster."

In a recent interview with Newsweek, Clinton outlined 14 steps he believes America should take to turn around the economy.

He mentioned President Barack Obama's initial idea to provide a tax credit for new green jobs and startup companies which Republicans squashed last December. Obama's plan would have allowed the conversion of credits in cash equivalents for every employee green companies hired.

"The cash incentive worked," Clinton told the news source. "On the day President Obama took office, the U.S. had less than 2 percent of the world market in manufacturing the high-powered batteries for hybrid or all-electric cars. On the day of the congressional elections in 2010, thanks in large part to the cash—incentive policy, we had 20 percent of global capacity, with 30 new battery plants built or under construction."

He added that 16 of those plants were based in Michigan - the state with America's second-highest unemployment rate. Restoring the tax credit would be a boon to manufacturing jobs.

Another idea Clinton proposed involved small business lending and many financial institutions' hesitancy to spend because they aren't confident enough in the economy. He added that banks still have more than $2 trillion in cash uncommitted to loans.

According to the news source, he proposed comitting $15 billion in funds from the Troubled Asset Relief Program to create a loan-guarantee system similar to the SBA, where a bank lends money to a business after a 75 percent guarantee from the federal government.

He recommended lending to businesses in buildings that are likely to stay in use, such as government buildings, schools, university structures, hospitals, theaters and concert halls, as well as private commercial buildings with no debt.

The CGI will close on Thursday with summary remarks from Clinton and priorities for future action.