Statement by CEO Frank Knapp at Senate Press Conf. on Financial Reform

By Frank Knapp Jr., Business for Shared Prosperity

Published April 21, 2010

I am Frank Knapp, president, CEO and co-founder of The South Carolina Small Business Chamber of Commerce. That’s right, South Carolina—not a bastion of liberal politics.

Let me tell you why we support financial/Wall Street reform.

How many Small Business Administration loans do you think South Carolina community banks made in the first 3 months of this year?—-29. That’s less than 10 a month.

There are over 100 thousand small businesses in our state many of which are desperate for a loan or line of credit to keep servicing their customers and even to meet the increased customer demand that we’re seeing. But there are virtually no loans to be found.

Our community banks are frozen. They aren’t making loans or lines of credit to small businesses that were deemed credit worthy just several years ago.

This week we learned that a successful community bank in the reddest county in the reddest state joined 11 other community banks in South Carolina that federal regulators are looking at because of falling credit ratings of mortgage backed investments.

This small bank didn’t do anything wrong just like the other community banks across South Carolina and the country didn’t do anything wrong.

And the small businesses across the country that can’t get loans, we didn’t create this economic crisis either.

We are all the victims of the irresponsible behavior of the nation’s “too big to fail” banks.

But those big banks did fail—-

They failed our community banks that are now frozen in their ability to make small business loans. And they failed our small businesses that now can’t get a loan to hire the workers to get us out of this economic crisis, something that all economists agree must happen.

We are all victims of the highly risky trading and rigged investment schemes of our nation’s biggest banks.

Now, we are going to get out of this recession. Loans will eventually start flowing to small businesses again, sooner than later if Congress takes several steps we have suggested and makes banks start acting like banks again.

But without the financial/Wall Street reform that includes a strong, independent Consumer Financial Protection Agency, the “too big to fail” banks will go back to their own greedy, irresponsible and even fraudulent ways—and they will fail all of us again.

Small business owners work far too hard and play by the rules to deserve this big bank-made disaster. And that’s why the business organizations here today and those that couldn’t be with us like Business for Shared Prosperity speak with one voice.

Support small business or protect the big banks and Wall Street. This should be an easy decision for every Senator.

The South Carolina Small Business Chamber of Commerce
1717 Gervais Street, Columbia, SC 29201 (803) 252-5733

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