November 18, 2016
Hedge fund manager and Trump transition team member Anthony Scaramucci, repeated one of the great lies of the era of Trump on Morning Edition today. He claimed that businesses could not get access to credit and blamed it on the regulations in the Dodd-Frank financial reform bill. This is the reason that he and others have given for repealing Dodd-Frank.
The problem with this story is that it is entirely an invention of the right wing. As I point out earlier this week the National Federation of Independent Businesses has been conducting a monthly survey of small businesses for more than thirty years. One of questions it poses is about credit conditions. In the most recent survey only 2 percent reported that financing was their top business problem. This is near a low point for the survey’s history. In other words, they are finding that small businesses are having very little problem getting access to credit.
Larger businesses that can borrow directly through credit markets also have little problem. Many economists, including Fed Chair Janet Yellen, have worried about the collapse of credit spreads, meaning that they are concerned that risky businesses actually are getting credit at too low an interest rate.
In other words, the idea that Dodd-Frank is preventing businesses from getting credit is a complete invention, like Fox’s War on Christmas.
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