Economic Homicide - How Big Banks Are Using Military Tactics to Exploit Small Business
A scorched earth policy is a military strategy which involves destroying anything that might be useful to the enemy while advancing through or withdrawing from an area.
At one time this was simply the practice of burning crops to deny the enemy food sources, in modern times the term is not limited to food.
It includes the destruction of infrastructure such as shelter, transportation, communications, and of course access to financing.
Here are some recent headlines in business publications: The SBA loan volume plunged 36% in 2009 as banks slammed their vaults shut to small businesses.
Top banks cut small business lending by $8 billion.
Want a loan for your business? Hit the plastic! One of the most effective counter terrorism measures that the US has quietly taken has been to interrupt or eliminate funding sources to terrorist organizations such as Al Qaeda.
An enemy that cannot eat cannot fight.
Similarly, a business that cannot access cash, cannot survive.
When banks retreated into the safe, secure, and regulated new world of easy 3% margins on money that the bailout and expanded government borrowing provided, what followed for small business was nothing short of a scorched earth policy.
The banking industry has instituted policies that essentially treat small businesses as enemy combatants.
While the balance sheets of the banks were being propped up by taxes that came largely from small business, the small businesses and their owners were shut off from credit lines of working capital that ultimately has resulted in layoffs and shut-downs.
Soon, a day of reckoning that the taxes collected from these small businesses won't just decrease by 30% as our housing values have, they will disappear altogether.
The vicious cycle is just beginning to unfold.
American small businesses have finally realized that they are being manipulated and attacked by the banking industry.
Our government officials make many eloquent speeches on the value of small businesses.
They seem to recognize the value and say the right words.
When it comes to passing tangible legislation, they sit complacently on the sideline.
Like Caesar at the Roman Coliseum, our government chooses winners and losers by a capricious thumbs-up or thumbs down signal, but real leadership in supporting entrepreneurship has not been forthcoming.
America's small businesses are angry and they have good reason to be.
At one time this was simply the practice of burning crops to deny the enemy food sources, in modern times the term is not limited to food.
It includes the destruction of infrastructure such as shelter, transportation, communications, and of course access to financing.
Here are some recent headlines in business publications: The SBA loan volume plunged 36% in 2009 as banks slammed their vaults shut to small businesses.
Top banks cut small business lending by $8 billion.
Want a loan for your business? Hit the plastic! One of the most effective counter terrorism measures that the US has quietly taken has been to interrupt or eliminate funding sources to terrorist organizations such as Al Qaeda.
An enemy that cannot eat cannot fight.
Similarly, a business that cannot access cash, cannot survive.
When banks retreated into the safe, secure, and regulated new world of easy 3% margins on money that the bailout and expanded government borrowing provided, what followed for small business was nothing short of a scorched earth policy.
The banking industry has instituted policies that essentially treat small businesses as enemy combatants.
While the balance sheets of the banks were being propped up by taxes that came largely from small business, the small businesses and their owners were shut off from credit lines of working capital that ultimately has resulted in layoffs and shut-downs.
Soon, a day of reckoning that the taxes collected from these small businesses won't just decrease by 30% as our housing values have, they will disappear altogether.
The vicious cycle is just beginning to unfold.
American small businesses have finally realized that they are being manipulated and attacked by the banking industry.
Our government officials make many eloquent speeches on the value of small businesses.
They seem to recognize the value and say the right words.
When it comes to passing tangible legislation, they sit complacently on the sideline.
Like Caesar at the Roman Coliseum, our government chooses winners and losers by a capricious thumbs-up or thumbs down signal, but real leadership in supporting entrepreneurship has not been forthcoming.
America's small businesses are angry and they have good reason to be.