A Public - Private Program to Sustain and Create Employment through Incentives for Private Rescue Lending
As financially impaired banks have retrenched from traditional secured lending to small and middle-market enterprises (SMEs) to preserve capital and repair balance sheets, a gaping hole in our financing economy has been shaped. More than eighty percent of this country’s work force is housed in companies with fewer than 500 employees. Middle-market and smaller companies, the backbone of the American economy, have lost access to the traditional working capital loans upon which they have long depended for managing businesses in the ordinary course. As a consequence to the sudden dearth of capital available in this market, companies that might otherwise rationalize and survive the current economic downturn are laying off workers -- layoffs that will result in permanent job losses as, without access to capital, these companies have no choice but to liquidate. This phenomenon is driving not only permanent job losses, but also the eclipse of technology and the destruction of transferable industrial knowledge, causing irreparable damage to the American economy.
The Rescue Loans Program (RLP) will exploit unused TARP funding intended for the Public Private Investment Partnership (PPIP) to incentivize qualified private investors to provide rescue financing to companies unable to access the bank loan or credit markets, temporarily filling the lending/financing void left by banks, hedge funds and collateral debt obligations (CDOs). Access to rescue financing will save many companies that might otherwise liquidate -- with a direct and immediately quantifiable sustainment of employment -- and will simultaneously assuage the urgent and overwhelming threat to our economy, rising unemployment. The Rescue Loans Program is not a bailout; it is a direct investment in American jobs.
Learn more about the The SME Rescue Loans Program by visiting: