The Small Business Lending Fund was cleverly named by its authors last Congress. Since its implementation, however, it would appear a more appropriate name would be the Bailed Out Bank Refinancing Fund. When Barney Frank and other supporters proposed the SBLF, it was believed banks would leverage the fund leading to hundreds of billions in small business loans. In their world, Congress was to allocate, Treasury was to disburse, banks were to lend and small businesses were to grow. Seems like an airtight plan, right? Then came reality. More than …
Upon passage of the financial reform bill, then-Speaker Nancy Pelosi (D-CA) said, “This is the next critical step forward in an effort to rebuild our economy.” This type of political hubris is reminiscent of what economist Friedrich Hayek referred to as the fatal conceit. Unemployment still stands above 9 percent, business confidence is in the tank and economic growth remains stagnant. As flawed as their claims may sound today, it is important to illustrate exactly where Ms. Pelosi, Mr. Frank and their allies failed so mightily one year ago. Let’s …
