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Show ''fa i. 1 An Inside View by CONGRESSMAN DAN MARRIOTT 1610 Longworth Bldg. llU 0J n;,i,;,t Washington, d.c. 20515 Utah Zna Uisrncr 12021225 3011 Unless Congress acts quickly, it may have the dubious du-bious honor of standing watch over the demise of America's Amer-ica's small business community. com-munity. , The ability of this Nation's sole proprietorships, partnerships part-nerships and small corporations corpor-ations to provide jobs, ideas and a foundation of strength for our economic system is being swept away by a com -binatlon of long-term high inflation, huge increases in energy costs, heavy regulatory regula-tory burdens, a tax system biased against the smaller firm and high interest rates. During the past ten weeks, both inflation and Interest rates have shown moderate declines, but unfortunately for far toomanysmall firms, the improvement is too little, too late. In testimony before the House Small Business Tax Subcommittee, a spokesman for the National Small Business Busi-ness Association reported that a recent study revealed a dramatic rise in business failures associated with interest in-terest rate movements. "From mid-1980 to mid-1981, mid-1981, business bankruptcies tabulated by the U.S. courts increased 30.1 percent over the previous year," he said. ;"That is the second largest year-to-year rise of the past 20 years. Court-filed bankruptcies bank-ruptcies have thus been run- that is no consolation to a boat already driven onto the rocks-or in dry dock for repairs. re-pairs. And, unfortunately, that is the state of many of America's battered and bankrupt small businesses. This proposal Is one step we can take to prevent even more small firms from joining join-ing their ranks. nlng at an all-time record rate of more than 4,000 per month since January, 1981." The National Federation of Independent Businesses concluded con-cluded that, for many firms, this prolonged period of high interest rates has been a "knockout" blow after having hav-ing been severely debilitated by the adverse effects of years of unsound government policies. In recognition of the severity se-verity of this problem, I Introduced In-troduced a bill which would establish a small business particlpatling loan with special spe-cial incentives for loans to minority and disadvantaged businesses. Under this program, pro-gram, the loan, which would be made by a private business or corporation, could only be made to a com -pany with equity capital of less than $10 million, it would not be subject to Securities Se-curities and Exchange Commission Com-mission regulations, it would bear a stated rate of interest inter-est (at least six percent) and it would pay anegotlated percent per-cent of the profits for a negotiated ne-gotiated period of time. The bill also amends the Small Business Investment Act to correct lending biases against small firms. This approach of encouraging encour-aging the private sector to finance small business is far superior to the present approach ap-proach of offering direct grants or loans financed by the taxpayers. In this period per-iod of reduced government involvement in the private sector, it is clear that now is the time for this type of approach. In light of our present economic situation some people have recently taken to quoting John F. Kennedy's observation that "A rising tide lifts all the boats. "But, |