Evening star., 1945-01-07
RFC Giues Aid TO Little Business
Seeks Reverse Mortality Trend Resulting From War
By Jesse II. Jones

In that field, lie the risks and adven-
individual initiative.
The forces arrayed against little busi-
ness are not those the early settlers
faced as they moved West, but they are
no less real Competition, depressions
and wars create many hurdles for little
business, frequently too many for the
man or woman imbued with the laudable
desire to be his or her own boss.
Because the impact of war imposes the
most severe strain little business has
had to face, its problems and how little
business can best be encouraged and
protected in cur day of mass production
and distribution are of great concern.
Early War Mortality High.
When the United States first entered
World War II and for many months
thereafter, the mortality rate among
little businesses was high. There are
many failures in this category during
more normal years, but, over a long
period of time, new ventures have ex-
ceeded those which have found the going
too rough. After we became involved
in the war, this trend was reversed. The
establishment of new businesses failed
to equal those which closed their doors
and between 1899 through 1943, the net
decline in the number of business estab-
lishments-large and small-totaled
536, 400, an average of more than 1,100
in each of the 48 States.
At the present time, the decline ap-
pears to have been checked and the
number of little businesses in operation
is remaining fairly constant. The year
1914 may even show slight increase.
We are at the point from which we
must go forward if small business enter
prises are to survive.
We in the Department of Commerce
and the RFC have not only had actual
private experience in little business, but
a great deal of experience in the rela-
tionship between Government and little
business. The personnel of the RFC,
including its directors and other execu-
tives, have spent their entire lives in
business-sman business. Executives
and experts in the Department of Com
merce are also experienced in small
business.
No Exact Formula.
We know little business, its problems
and it's difficulties. There is no exact
formula for defining little business.
The man who operates a shoeshine
stand, an independent drug store or
corner grocery is certainly little busi-
nessman, but there are little business
men in the steel industry, in the field
of automobile manufacturing, in the
production of tobacco products, the
operation of hotels, restaurants, radio
stations and many other lines.
Suppose We say that any business
which needs financing up to 100000 is
regarded a small business and for the
purpose of this discussion, that figure
is probably as accurate a measure as
we can arrive at.
The Reconstruction Finance Corp.
has made more than 1880 individual
loans in this category, but if 100000
strikes you as being a lot of money,
the RFC has made approximately 1000
loans under $4,000, 3,400 loans between
$4,000 and $4,000 and 4,5oo loans be-
tween $4,000 and $25,OoO.
1t has actually disbursed 81 ,008 ,675, ,948
to business institutions in the 10 years
in which it has possessed the authority
to make business loans. 1t has made
more than $4,000 such loans-some in
every State of the Union. The fact
that we have made and offered to
make business loans, both directly
and in cooperation with banks, has
made credit available to thousands
of independent businesses on terms that
they could hope to meet-and usually
do meet-loans on terms that banks have
heretofore, for one reason or another,
been reluctant to make. This reluctance
was due in some cases to banking laws
or customs against longtime loans and
many times because the loan did not ap-
pear to be risk that the bank could take
Many Saved From Failure.
These figures and facts demonstrate
that the RFC has appreciated the i'm
portance of little business to our econ
omy and has been active in making
credit available for it. Our experience
in making these loans has demonstrated
that with proper attention, encourage
Iryin