H.R.4153 - Supporting Trade and Rebuilding Opportunity for National Growth Act (119th Congress)
Summary
H.R. 4153, the STRONG Act, proposes amendments to the Small Business Act and the Small Business Investment Act of 1958. The primary goal is to increase the maximum loan amounts available to small businesses through the 7(a) loan program and development company loans.
Specifically, it seeks to raise the maximum loan amount for 7(a) loans from $3.75 million (or $5 million gross) to $7.5 million (or $10 million gross). It also aims to increase the maximum loan amount for development company loans from $5 million (or $5.5 million) to $10 million.
This bill intends to provide greater financial support to small businesses, potentially stimulating economic growth and job creation.
Expected Effects
If enacted, the STRONG Act would significantly increase the borrowing capacity of small businesses through SBA loan programs. This could lead to increased investment in business expansion, equipment upgrades, and job creation.
The increased loan amounts may also encourage more entrepreneurs to start new businesses, further contributing to economic activity. However, it could also increase the risk of loan defaults if businesses are unable to manage the larger debt burdens.
Potential Benefits
- Increased access to capital for small businesses, fostering growth and expansion.
- Potential for job creation as businesses invest in new projects and hire more employees.
- Enhanced competitiveness of small businesses against larger corporations.
- Stimulation of local economies through increased business activity.
- Support for entrepreneurial ventures and innovation.
Potential Disadvantages
- Increased risk of loan defaults due to larger debt burdens on small businesses.
- Potential for inflation if the increased loan amounts are not matched by increased productivity.
- Possible strain on the SBA's resources and capacity to manage larger loan portfolios.
- Risk of misallocation of capital if loans are not properly vetted and managed.
- Could lead to increased competition and potential displacement of smaller businesses that cannot access these larger loans.
Constitutional Alignment
The bill appears to align with the spirit of the Constitution, particularly the clause promoting the "general Welfare" of the United States. Article I, Section 8 grants Congress the power to regulate commerce and enact laws necessary and proper for carrying out its enumerated powers.
Supporting small businesses through increased loan amounts can be seen as a means of promoting economic activity and overall prosperity, which falls under the umbrella of general welfare. The bill does not appear to infringe upon any specific individual liberties or rights protected by the Bill of Rights.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).