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The Consequences of Republicans' Small Business Obstructionism

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This post originally appeared on the Washington Monthly.

A month ago yesterday, there was reason for optimism on the small-business bill pending in the Senate. The aid package included tax breaks, new incentives, and an attempt to expand credit through a lending program that utilizes local banks, and with 59 supporters, the Democratic majority only needed one GOP vote to overcome yet another Republican filibuster.

They didn't get that vote. Shortly before the Senate broke for its recess, Republicans threw a bit of a tantrum over the number of amendments they were allowed to consider, and unanimously blocked the chamber from voting on the bill.

The consequences of GOP game-playing are as discouraging as they are obvious.

Small businesses have put hiring, supply buying and real estate expansion on hold as they wait out the vote on a small-business-aid bill that stalled in the Senate earlier this summer.

The much-debated legislation offers tax breaks and waived loan fees. But it also comes with more divisive components, such as a $30 billion fund that would help community banks give loans to small businesses.... Many small businesses had hoped the legislation would pass the Senate by the end of July. With two weeks left until Congress reconvenes, those firms are in a holding pattern.

"I'm still waiting for Congress to sign off on the bill," says Amarjit Kaur, who runs a convenience store and gas station in Wood Village, Ore. She leases her property but has a chance to buy it. With the waived-fee provision, Kaur says she could save about $35,000 on her pending loan.

Keep in mind, the bill doesn't add to the deficit. The only reason Republicans blocked a vote was because they demanded that they be able to offer amendments to the small-business package that have nothing to do with small businesses -- including measures related to border security and Bush tax cuts. They don't really expect the amendments to pass, but GOP leaders hoped (a) that the votes would put Dems in an awkward spot; and (b) the process of considering them would take up more floor time, and make it impossible to consider other legislation this year.

The Democratic leadership balked, so the vote on the bill was put off. And as a result, about a thousand small businesses are ready to expand, but are instead just sitting there, waiting for our political system and the Republican Party to be less ridiculous. (Whether the GOP did this deliberately, worried that small-business expansion before the elections might help the economy and interfere with Republican election plans, is unclear.)

Often, when the political world considers the GOP's scandalous obstructionism on Capitol Hill, we're reminded of an exasperatingly dysfunctional policymaking process. But it's worth remembering from time to time that the nonsense carries with it real-world consequences.

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