WASHINGTON (Reuters) - President Barack Obama, who has been focused on the Gulf of Mexico oil spill, will give the U.S. Congress a nudge on Friday to approve a $30 billion plan to spur lending to small businesses to trigger job creation.
Obama has been criticized for not doing enough to generate job growth, and his proposal was offered in February but has been bogged down on Capitol Hill.
“The president has put forth a series of proposals to help small businesses grow and hire, and he’ll continue to urge Congress to act on these proposals that are essential to strengthening our economy and getting Americans back to work,” said a White House official on Thursday.
Obama is to meet small business owners and workers at the White House and make remarks in the Rose Garden.
During the worst recession in decades, many small businesses reported having trouble getting credit. Obama’s proposal would establish a $30 billion fund to boost lending to small businesses looking to hire and expand their operations by providing additional capital to community banks.
The House of Representatives Financial Services Committee approved the Small Business Lending Fund Act last month by a vote of 42-23.
The White House official said Obama will call on the House to approve the plan along with a new state Small Business Credit Initiative that would spur more than $20 billion in new lending through state-based programs.
“And he’ll urge Congress to pass other small business proposals including elimination of capital gains taxes for small businesses and new tax relief for small start-ups to spur new business creation,” the official said.
Job growth and government spending are major issues in November congressional elections in which Republicans hope to gain ground on large Democratic majorities in the House and the Senate.
Some Republicans have opposed the lending plan, arguing it is the wrong prescription for battered small businesses. They have said it would encourage more government involvement in private businesses along the lines of the $700 billion Wall Street bailout known as the Troubled Asset Relief Program (TARP).
Reporting by Steve Holland; editing by Mohammad Zargham