It seems pretty clear that the Obama Administration wants businesses to start hiring again and that they want that to happen really badly. The President has been doing a certain amount of campaigning to let citizens know what he’s been doing to deal with an unemployment rates that is stubbornly hovering at around 10%. It’s a bit soon to say whether any of that adds up to government chasing its own tail or whether it really will spur job creation. I think it is legitimate to question the claim that government ever persuades businesses to hire when they would not otherwise have done so, although there are certainly plenty of instances of the reverse — government policies dissuading businesses from hiring when they otherwise would have. But I digress. Whether any of what has already done is working or will work, there is more of it coming. Last week, the House Financial Services Committee marked up the Small Business Lending Fund Act (H.R. 5297).

This bill creates a fund from which the Treasury Department would be authorized to make investments into small banks and community banks as an incentive to increase their small business lending. In addition, the bill contains provisions that would provide federal support for certain state capital access programs, provided those programs are restricted to small firms borrowing no more than $5 million. There’s plenty of partisan bickering here, with Democrats saying banks need to be persuaded to lend to small firms and Republicans saying loan demand is down and, by the way, stop throwing money at the problem. Either way, don’t expect this to help microbusinesses, which have never had much in the way of access to capital to begin with. Microbusinesses need more than loans to create jobs — paying customers would be helpful — none of these efforts to support job creation are likely to amount to much for those smaller firm size classes of employers.