When a Bailout Plan Ends Up as Good News

Ben Cunningham sent along a link to a story that looks into what actually happened with the $15 billion for small business support announced by the SBA last spring.  I had raised concerns about an artificial infusion of debt financing for small businesses when this was first announced (see here and here).

It seems that as of today, none of the money has been distributed.  From Jake Tapper with ABC News:

The source told me that the reason the program has not been officially utilized was twofold.

One, almost every potential participant declined to cooperate because they didn't want the stigma of using TARP funds given the tremendous public anger towards Wall Street and resentment about the $700 billion bailout.

Two, the specific purpose of the plan - to get the secondary market moving again for these SBA loans - was largely accomplished.

It may seem odd, but a story about government bailouts actually qualifies as a "The Glass is Half Full" post.

Why?

First, the public is not buying "government as the solution" policies and are pushing back against them.  Although the story only references TARP, bailouts and the wasteful spending they have created have been getting more and more bad press and scrutiny from the public.   

But even more importantly, the market worked on its own without the government helping with massive infusion of taxpayer dollars.

I doubt that most of those inside the belt-line in Washington understand the real lessons of this story, however.