Federal small business loan limits should be dramatically increased to help farmers and manufacturers contend with rising equipment costs, U.S. Small Business Administration chief Kelly Loeffler said Thursday during an Indiana visit with U.S. Sen. Todd Young.
Loeffler, a member of President Donald Trump’s cabinet, joined the Indiana Republican senator for a tour of an Indianapolis manufacturer before heading to the Indiana State Fair, where the pair met with farmers and participated in a discussion focused on agriculture and small businesses.
Young said businesses around Indiana are looking for greater certainty as they make decisions about investing and expanding, while farmers continue to face elevated input costs.
“The world is dynamic and uncertain right now, and that’s always the case, but especially so right now,” Young told reporters at the fair. “So, to the extent our policymakers can bring more certainty to public policy. That leads to capital investment in businesses, so that we can take our small businesses and grow them in the large enterprises that employ a lot of Hoosiers and other Americans.”
Young said he’s also hearing support from businesses for continuing federal tax policies and rolling back regulations.
Loeffler similarly argued that tax cuts, deregulation and the administration’s trade policies are helping boost manufacturing in rural communities. The two earlier toured Thomas & Skinner, a more than century-old Indianapolis-area small business.
I think increasing the loan amounts would be rocket fuel for the economy.
But during an agriculture-focused panel later Thursday, Young acknowledged challenges remain for farmers.
“I’ll say input costs go up and down. We’re in a cycle right now, and the input costs are elevated,” Young said. “Our farm community talks about that, but we’ll always need to be able to invest in more productivity so that you can manage those ups and downs more effectively.”
Loeffler said one way the federal government could help is by significantly increasing the amount small businesses can borrow through SBA-backed lending programs.
The maximum for SBA small business lending was last increased in 2010, Loeffler said, while the cost of farm and manufacturing equipment has risen considerably since then. She said the agency has started allowing borrowers to “stack” different loan types to reach $10 million, but wants to see an increase.
“Let’s double the loan size for people in production like agriculture and manufacturing to get up to that $20 million because that’s really what it takes in terms of scale today,” she said.
Young, a member of the Senate Small Business and Entrepreneurship Committee, indicated that he would support revisiting those limits.
“I think increasing the loan amounts would be rocket fuel for the economy,” Young said.
Young also said Thursday that he could soon take on a larger role shaping those policies. He said he is “probably going to become the next chairman of the Small Business Committee, depending on how the election goes in November.”
Trade, regulations and technology
Much of Thursday’s discussion focused on agriculture. Loeffler and Young praised the Trump administration’s efforts to reduce federal regulations and open foreign markets to U.S. products.
Loeffler highlighted efforts to change diesel exhaust fluid requirements and other regulations affecting farmers, truckers and other heavy industries. Young separately pointed to the administration’s support for farmers’ ability to repair their own equipment.
“A farmer ought to be able to fix their own combine without paying through the nose, and unfortunately, some of these manufacturers they design their systems these days so that you have to pay a lot of money for service,” Young said.
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Trade was also up for discussion.
Loeffler argued the administration is pursuing “fair trade” by challenging tariff and non-tariff barriers facing American agricultural products. Young said efforts to address non-tariff barriers, particularly those affecting U.S. biotechnology products entering European markets, have received too little attention.
“When given a level playing field, I have to tell you our producers outcompete the entire world, and that’s all we want,” Young said.
The senator additionally pointed to Indiana’s investments in biotechnology, semiconductor manufacturing and drone technology as areas that could create new opportunities for farmers, manufacturers and rural communities.
Young said farmers are already more sophisticated in their use of artificial intelligence and drones than he had expected.
“Though there are a lot of uncertainties and risks in our ag economy right now, that’s inspiring, and it’s also encouraging as we get deeper into this disruptive age,” Young added.
Loeffler said access to workers remains one of the most common concerns she hears from small businesses nationally. Manufacturers the pair visited Thursday said they would hire more workers if they could find people with the necessary skills, she said.
Young weighs in on redistricting, farm bill
Young also fielded questions on issues beyond small business and agriculture during a media availability before the panel.
Asked whether Indiana has experienced — or could face — repercussions from the Trump administration after state lawmakers rejected a Republican push to redraw the state’s congressional districts, Young did not directly address whether he had seen evidence of retaliation.
“No, I stayed out of that,” Young said before pivoting to the November elections.
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He said Republicans he has spoken with around Indiana are “really unified as a state Republican Party” and predicted the party would benefit in the midterm elections.
Young said he also believes Congress is nearing agreement on a new farm bill.
Senate Agriculture Committee Chairman John Boozman of Arkansas has made “every effort” to advance the legislation and is engaged in tough negotiations, Young said.
“I’m told we’re pretty close, and you know, listen, we need to come together for the good of our rural communities and give them the risk management programs and the other basic programs that are required to feed the world,” Young said.