Last Week, Bennet Challenged Federal Reserve For Lack of Lending on Main Street - Urged Aggressive Action
Bennet Keeps Up the Push - Requests Additional Evidence Of How Fed Reserve Will Open Up Credit For Struggling Small Businesses
Following up on his request last week for evidence of how the Federal Reserve is opening up credit for small businesses, Michael Bennet, U.S. Senator for Colorado, today pushed Chairman Ben Bernanke for an immediate update on their small business lending actions. As a result of the economic crisis, small businesses across Colorado have struggled to obtain access to loans that they need to keep their doors open and make payroll.
In an effort to ensure small businesses have access to necessary credit, Bennet sent a follow-up letter to Federal Reserve Chairman Ben Bernanke requesting that he develop a way to evaluate the effects of the Federal Reserve's actions.
In the letter, Bennet wrote: "Without meaningful data, we won't be able to ascertain whether the Federal Reserve's policies are ultimately promoting or even stifling access to credit. Such measurements will also assist our work on the Banking Committee as we look for ways to ease the credit crunch and strengthen our broader economy."
Bennet further noted that "Without much needed credit, we won't be able to create jobs and get our economy back on firmer footing...Clearly, the Federal Reserve needs to do more to ignite small business lending."
The full text of Bennet's letter to Chairman Bernanke is included below:
December 9, 2009
The Honorable Ben Bernanke
Chairman
Federal Reserve Board
12th Street and Constitution Avenue, NW
Washington, DC 20551
Dear Chairman Bernanke:
I write to follow up with you in light of our discussion on small business lending during your confirmation hearing last week.
Small businesses across our country are struggling to obtain access to credit, which they need to invest, grow, or even keep their doors open. Without much needed credit, we won't be able to create jobs and get our economy back on firmer footing.
During your testimony, you indicated that the Federal Reserve has created guidelines and conducted training for examiners to ensure that banks retain the appropriate levels of capital without unduly stifling their ability to extend credit. Notwithstanding these efforts, small businesses are continuing to struggle and we've seen little, if any, evidence that it has become any easier for businesses on Main Street to obtain a loan. Much evidence, and certainly the word-of-mouth in my home state of Colorado, runs to the contrary.
Clearly, the Federal Reserve needs to do more to ignite small business lending.
As we discussed during the hearing, I believe that we need to develop a way to evaluate the effects of the Federal Reserve's actions. Without meaningful data, we won't be able to ascertain whether the Federal Reserve's policies are ultimately promoting or even stifling access to credit. Such measurements will also assist our work on the Banking Committee as we look for ways to ease the credit crunch and strengthen our broader economy.
Without such data, I fear that we'll miss a critical opportunity to assist small businesses, create jobs, and get this economy going again.
During the hearing, you indicated that you would work to find more useful metrics to assess where we stand on small business lending. It is my hope that you can update me on your progress at your earliest possible convenience. I would also be willing to meet with you or your staff to discuss further how we can create more useful measurements to assess the state of small business lending.
I look forward to your response.
Sincerely,
Michael F. Bennet
United States Senator
