When we write about health care, we have tended to focus less on the particulars of a potential plan and more on, say, the necessity of genuine reform to save small businesses billions of dollars, or on the tricky politics surrounding an employer mandate. We have not taken a position on, for example, the public option--the notion of a government-run insurer that can assume the burden of the currenty uninsured as well as use its buying power to negotiate rates, promote certain treatments, and through competition lower prices throughout the health insurance industry.

Now, though, Jonathan Weber, the small-business columnist at our sister site The Big Money, has made what might be termed the small-business case for the public option. It's not, in other words, based on the more ideological pros and cons, but on the much simpler proposition that ordinary small businesses should not have also to be in the health-insurance business.

"There is little economic logic in forcing companies to provide health insurance," Weber argues. "It distracts them from their principal mission, it gives large companies a big advantage over small companies (big companies can leverage economies of scale to reduce their per-employee costs), and it introduces friction in the job market by creating an external incentive not to change jobs." (Indeed, we've written about the numerous ways in which the current system disadvantages small businesses here.)

Weber also notes that many small-business groups--in particular, the powerful National Federation of Independent Business--appear to be opposed to a public option for ideological reasons rather than small business-specific ones. We've taken the NFIB to task for prizing conservative ideology over common sense in the card check, fair-pay, and estate tax debates already; if we were you, we'd expect to see a post on health care shortly.

Meanwhile, the big news on the health-care front today is that none other than Wal-mart has come out in favor of a broad-based employer mandate--a general requirement (potentially exempting small businesses) that employers provide health benefits to their workers. Wal-mart's being canny, to be sure--this move makes it look reasonable, and may also make a public plan less likely--but it's worth noting that its letter is co-signed by the heads of the Service Employees International Union and of the liberal Center for American Progress--so if it's being canny, it's also being serious. We're not sure exactly what the implications of this move are for small businesses. Suffice to say, though, that the burden that would fall on Wal-mart's being required to insure all of its employees is far less onerous than the one that would fall on the average, truly small business.

In light of the recent efforts to come up with a reformed regulatory infrastructure for the financial industry, I feel the need to reiterate my comments on our financial industry's regulators, which I have referred to as Our Nation's Ball-less Wonders (what can I say, I'm colorful!). I especially want to look at how they have dealt with and will now deal with community banks.

The current debate has focused on whether the Federal Reserve should become a sort of mega-regulator. But the real question, I think, is whether in the past the Fed has performed its job to protect this country and our economy by actually enforcing the regulations that existed. I think the facts show that the answer is no.

First, a primer. In the world of banking there are five regulating authorities: the FDIC regulates state-chartered banks because it insures them; the Comptoller of the Currency regulates national banks; the Fed regulates banks that become members of the Federal Reserve System; the Office of Thrift Supervision regulates thrifts; and the National Credit Union Administration regulates--guess!!--credit unions. When Congress passes a law, such as the Fair Credit Reporting Act, it orders each agency to adopt regulations to implement that law. When the law affects more than one jurisdiction, the relevant governing agencies will come together and create a "uniform regulation" that will be applied throughout the industry.

Additionally, while there is a need for all banks to comply with, say, the Safety and Soundness in Lending and the Fair Credit Reporting Acts, there is quite a distinction among investment banks, national banks, regional banks, and community banks, and their different regulators reflect this.

One mega-regulator could potentially lose sight of the contribution to our country fostered by a healthy competition within the industry, including from the community banks. I fear a mega-regulator will ultimately move us closer to having fewer banks to chose from, with our valued community banks being the loser in this game.

My fear is that transferring most regulatory authority to one agency will dilute the current system of checks and balances, and will reduce the possibility that some agency, any agency, will cry foul and take action when the financial companies fail to adhere to the laws of this country. Perhaps the plan might work, if, in addition to the consolidation, the people were also represented by an ombudsman to act as watchdog when the Fed fails to do its job, as it surely will.

To be fair, when we evaluate the benefits of a mega-regulator, I would say that any consolidation that reduces expenses and thereby saves taxpayer dollars, is a good plan.

Still, the Fed has failed us miserably in the past, and I have no reason to believe that they will perform any better in the future.

Finally, I must once again encourage the individual people of this country to meet with their Congressional leaders and to write to their journalists to express their opposition of this new plan. This country affords us freedoms, and as a people, we are failing miserably in exercising our rights to play a vital role in our own destiny.

Anonymous Banker is a 35-year veteran of the banking industry who has spent much time as small-business banker and credit underwriter. He blogs at anonymousbanker.com.

The New York Times runs not one but two stories highlighting ways in which big and small businesses can create a symbiotic, mutually beneficial dynamic, rather than one in which they are constantly at odds.

One article describes how the owner of KIND Snacks strove to, and inally succeeded in, getting Starbucks to sell his fruit and nut bars (which are bound together by honey, rather than an artificial paste, and are therefore healthier and more organic). "Big product makers have a clear advantage" in getting retailers to sell their goods, the article reports, "because they can usually offer multiple product lines at lower prices and already have inventory management systems in place. Smaller companies must compete on price with major brands, but also be unusual enough to make them worth the retailer’s investment."

The second article describes programs that several large corporations--the piece mentions I.B.M., Wal-Mart, Proctor & Gamble, and Home Depot--offer that involves their executives mentoring small businesses that are involved in the larger company's supply chain. Beyond such programs, there exists among some of the world's biggest businesses a broader commitment to including all sorts of companies in their supply chains: witness the Billion Dollar Roundtable, a group of 16 huge corporations (IBM, Boeing, General Motors, Lockheed Martin, and, yes, Wal-Mart) that do at least $1 billion's worth of business per year with women- or minority-owned firms.

What we like so much about the articles, and the broader dynamic they describe, is that the big companies' attitude toward the smaller ones is decidedly not charitable. Starbucks expects those KIND bars to sell well, and if they don't, they're probably gone. The companies that offer mentoring programs want to ensure that the companies on the other end of their business transactions are well-run and reliable out of self-interest.

There is, additionally, an interesting branding dynamic at work here, we'd argue. In offering those KIND bars, Starbucks is doing more than trying to turn a per-unit buck--indeed, given that the bar is a finished product purchased wholesale from another company, there is no way Starbucks is making that much of a profit selling these bars at only $1.95 apiece. Rather, they are aligning their brand with a small business, and what's more with one that promotes an active, healthy lifestyle--something that is very in right now, and that the famed purveyor of $5 cappucinos could use a bit more of an association with. One of the companies that an I.B.M. executive mentors is owned by a gay man, and I.B.M. touts its participation in the I.B.M. program as a part of the multinational's outreach to LGBT-owned businesses.

It's not cynical; it's smart business. And it shows that the big corporations need the little guys, too.

Generally, what we talk about when we talk about health care is reforming it so as to get small businesses out of the business of providing it as well as saving them billions of dollars. However, BizBox doesn't run the world (not yet, anyway), and so if you decide to quit your job--or if that decision is made for you--and then start your own business, you're going to need either to purchase health insurance on your own or go without. In the spirit of not being afraid to be service-y, let's take a look at a recent Wall Street Journal article on how to buy health insurance.

In essence, the article recommends that you do your own homework--and a lot of it. It recommends Georgetown University's healthinsuranceinfo.net, the National Health Law Program's healthcarecoach.com, and the Kaiser Family Foundation's site. And even with all of those resources, it still may also be worth consulting an independent agent, or several (make sure they have a license!), particularly if it's your first time buying on your own.

Beyond that, caveat emptor! Buy insurance, not just a discount card. Look beyond premiums: make sure you have a catastrophe insurance, that your out-of-pocket costs are capped, that your percentage of doctors' visits is reasonable.

And don't forget to see if you're eligible for federal unemployment-related health benefits! Our very own Jerry Kalish expounded on how the federal stimulus law expanded that coverage--check it out.

We examined this question earlier this week: comparing a pessimistic post by Scott Shane of You're The Boss and a more optimistic one by John Tozzi of The New Entrepreneur, we concluded that while traditional small business owners may be genuinely pessimistic, and not without legitimate reasons, the dynamics of the recession are actually likely to encourage the rise of non-employee--that is, single-person--businesses.

Well, we have another post in us on The State of Entrepreneurship, and it once again results from the dialectic between a pessimistic Scott Shane and a less-pessimistic John Tozzi.

Shane writes: "Most Americans would like to believe that this country is getting more entrepreneurial over time. While I wish this were true, the data don’t agree. Policy makers need to take a look at these data and acknowledge the pattern." And Shane has the charts to prove it. We don't want to rip them off; but go to his post and see for yourself. Disheartening stuff.

What's to blame? Shane fingers Wal-Mart and the like: "Large, efficient companies are able to out-compete small start-ups, replacing the independent businesses in many markets. Multiply across the entire economy the effect of a Wal-Mart replacing the independent restaurant, grocery store, clothing store, florist, etc., in a town, and you can see how we end up with a downward trend in entrepreneurship over time." Indeed, Shane has literally written the book on this phenomenon. It's a compelling explanation.

But Tozzi takes a different view.

Without denying the Wal-Mart effect, Tozzi points to the "emergence of niche markets where many small players compete, without the dominance of a Wal-Mart-like giant, or even mass markets where niche players are gaining a foothold." This is straight out of Chris Anderson's famed book The Long Tail, in which Anderson--the editor of Wired--predicts an infinitely fractured marketplace increasingly shifting away from a select few blockbuster goods and towards many, many, many more smaller-selling niche goods.

How does Tozzi rebut Shane's convincing graphs? He notes that they all start twenty years ago, and, arguing that "there could be an inflection point around the beginning of this decade," he predicts that the data we get in the coming years could show that things turned around for entrepreneurship in America thanks to the long tail/increased prevalence of niche markets. Again, compelling.

We took Tozzi's side last time; this time, we're a little more bearish. Tozzi's point certainly carries during boom times, especially the middle of this past decade: increased consumer spending really did prove a boon both the Wal-Marts and the tiny businesses of the world, which benefited from increased profitability of niche markets. The rising tide truly did lift both the big and little boats. However, the past two years (and especially the past year) have not been so kind to consumer spending, and while that ultimately hurts everyone, it's going to hurt the little guys, operating in their little niche-markets, far, far more than it is going to hurt the Wal-Marts (indeed, Wal-Mart is still managing to turn profits).

So on the one hand, we think that Shane's numbers might be a little misleading (although we don't doubt their integrity), and that his "Wal-Mart effect" explanation might be a little oversimplified (though we don't doubt its ultimate validity). However, recessions have the effect of simplification, and we'd suspect that entrepreneurship indeed is taking a disproportionate hit as of late.

We'll be off tomorrow, and probably posting lightly through at least the middle of next week. Happy Fourth, everyone!

Those lousy jobs numbers. You probably saw on your front page that June witnessed the unemployment rate rise to 9.5%--the highest point in 26 years. Here's the news viewed through a small-business lens. [The Entrepreneurial Mind]

Small business tax breaks. A video runs down several that the federal stimulus law introduced. [SMSmallBiz]

Credit or charge? Which type of card should you get for your business? [OPEN Forum]

Cutting when they've already cut. A dispatch from the small-business frontlines: how do you keep slashing costs after several months of same? [Fortune Small Business]

"The Gray Entrepreneurs". A fascinating juxtaposition of a study and an Economist article reveals an interesting trend: likely increased entrepreneurship among the Baby Boomers. [NYT Idea of the Day]

What are your Odds of Success? An online questionnaire calculates it for you. [Entrepreneur Daily Dose]

We're on a limited posting schedule for the next few days, but we thought we'd take note of the most recent quarterly statistics for Small Business Administration-backed loans. These loans, which are made by private lenders but backed to varying degrees by the SBA, have been the beneficiaries of numerous subsidies stemming from February's federal stimulus law: their fees have been temporarily waived; more businesses are eligible for them; and the loans are backed to a greater degree, and at higher amounts, than ever before. All in the name of trying to increase the flow of much-needed credit to small businesses.

And the results? The year-over-year numbers are down 30% from 2008, and 55% from 2007. Loans from the first nine months of fiscal year 2009 are down nearly 50% from the same period in 2008. In sum, we have our first look at the SBA programs with the subsidies in place--and with everyone knowing that the subsidies are in place--and things are significantly worse.

So does that mean the subsidies failed? Well, there's no way to know. We don't know what those loan figures would be if the subsidies had never been instituted. Certainly, though, it is eminently plausible that those figures would have been much, much worse, in which case the subsidies indeed succeeded in doing what they were supposed to do. The consensus, after all, is that demand for credit is if anything the prime culprit for the decline of small-business lending, not banks' (un)willingness to lend.

But are the subsidies a waste? Here we'd have to say yes. What these numbers are telling us, it seems, is that credit is not where attention should be focused. Lending is going to be down, period. Partly this is just smart business strategy: in good times, credit tends to be used less to get by and more to grow, and recessions are not good times to pursue growth strategies and to assume increased debt when you don't have to.

Consumer spending, on the other hand, is down, and in a way that only does harm to small businesses. So we would've liked to have seen the money used for these lending subsidies to have instead been used for various programs to juice spending. In fact, we've been saying this for some time. And while we take no pleasure in seeing these lousy statistics tell us that we were right, that is exactly what's happening.

We use the expression of a "red flag"--as in, “you're waving a red flag"--as a metaphor for something that incites interest, or for something that signals that it is fishy. Red, of course, tells you to stop. The metaphor comes, I like to think, from the sport of bullfighting.

In the tax world, a "red flag" is a big bright thing sticking out from a tax return that provokes the raging bull known as the IRS to investigate more closely, and perhaps conduct an audit. Matadors may find it handy to unfurl their red flags; taxpayers will not.

Red flags are exactly what Peter Pappas writes about in a recent post on his The Tax Lawyers Blog. (Hat-tip to Joe Kristan of Roth & Company, P.C.)

Here’s Pappas’s list of the "5 Slam Dunk Audit Red Flags"

1. Home Office Deduction
2. Job Expenses
3. Rental Losses
4. Schedule C Expenses (which is to say, business expenses).
5. Charitable Contributions

You can read Pappas’s post in its entirety to get the entire picture, but here are some suggestions that he says may dilute the red flag status of these deductions.

1. File your return in a timely manner.
2. Use a recognized software program to prepare and print your return.
3. File the return electronically.
4. Have a respectable CPA, tax lawyer, or IRS Enrolled Agent sign your return as tax preparer.
5. Attach explanatory statements to your return where necessary.

We’re already six months through the current tax year so it’s not too early to consider Pappas’ suggestions. In fact, when it comes to tax matters, it’s never too soon.

Jerry Kalish is founder and President of National Benefit Services, Inc., a Chicago-based employee benefit consulting and administrative firm that serves private-held companies, publicly traded companies, and public sector employers. He blogs at The Retirement Plan Blog and can be reached at jerry@nationalbenefit.com.

Or, as the Romans would've said, "Quo vadimus?" As unmistakable signs of the beginnings of nascent economic turnaround begin to pop up, it's the question many small business owners are asking themselves: what's next? When are things going to get better? And how can I make sure I'm still around when they do?

As to whether things are indeed turning around, Scott Goltz of You're The Boss says: yes, they are--"if you are still in business, take a deep breath. We have probably survived the worst of the economic collapse." And OPEN Forum reports on a new study finding that most small business owners agree: 88% perceive business opportunities; 61% expect growth in the next year; 57% think investing in their businesses is currently a smart move.

So if Oz really is at the end of the road, how do you make sure you don't fall by the wayside in the meantime?

Goltz has some good advice on this score. First: focus on cash flow. Every small business owner ought to tack his mantra up on their walls: "companies go broke because they run out of cash, not because they are unprofitable." To be sure, if you are unprofitable, then you will also, eventually, run out of cash. But now that genuinely decent times are on the horizon, the important thing is to focus on keeping the cash coming in, minimizing how much of it is leaving (in the form of expenses), and holding out until good times enable you to make some real money again.

Second, he recommends that you address employee strengths and weaknesses. Essentialy, he's not necessarily suggesting that you eliminate entire positions--indeed, that's something you've likely already done if you've needed to. But he is suggesting that if you have certain employees who maybe are not working out as well as they could be, that now is the time to replace them. He hints at a current dynamic at play, which is that there is an extremely strong buyer's job market: there are lots and lots of qualified people out there looking for a limited number of spots. Now is the time to pounce and nab the best personnel you can find.

Finally, he suggests utilizing six-month data. We've now spent a solid six months of recession, where everyone has known we are in a recession and there is indeed less uncertainty about where exactly we are heading (as opposed to, say, last October, which was both dismal and filled with uncertainty). Extrapolating from the past six months to the next six should yield predictions that are, if anything, less positive than what will come to pass. Don't let those numbers go to waste.

And don't let the next six months go to waste! Now is your final chance to slim down, get sharp, and be ready for a period during which, just perhaps, you can once again grow your business.

In the course of a column about employer health-insurance mandates--we promise, we will refer to this in a future post--the WaPo's business columnist Steve Pearlstein refers to the notion that small businesses are responsible for the majority of job growth as a "myth". "In terms of new job creation, the data show that most of it happens in a small number of very fast-growing companies that are no longer what most of us would consider small," he argues.

Noting that he was once an editor at Inc., where he "worked on some of the articles in which some of the seeds of this myth were planted," Pearlstein adds: "a lot of small-business job growth has also been driven by the decision of big businesses to outsource many tasks that they used to do in-house. In an economic sense, jobs haven't been so much 'destroyed' and 'created' as they have been shifted from one company to another." Pearlstein doesn't provide stats; but we do know him to be a trustworthy guy who tends moreover to have the right policy instincts.

Still, we can't help but juxtapose a recent post from The New Entrepreneur's John Tozzi, in which he uses Small Business Administration figures to chart how small-business jobs are affected during good times and bad. Tozzi predicts that the sweet spot of job creation in the next year or two will be less businesses with 1-19 employees and more those with 20-500, which are frequently known as "medium-sized".

Tozzi does, however, point out that there is one type of business with 1-19 employees that is witnessing substantial "job" growth: namely, those businesses with exactly one employee. One SBA economist predicts that 2008 alone will have seen 1.7 million new non-employee (i.e., single-person) businesses created, which makes it a far more productive year for that type of business than years in which the economy was actually, you know, good.

We wrote last week about the U.S. Census's finding a similar trend. Clearly recessions do a good job at encouraging people to strike out on their own. Which means two things: one, that small businesses are better at creating "jobs" than some statistics may first show, given that the "employees" of non-employee businesses may not count as "jobs created" even when, for all intents and purposes, one more person is being put to work. And secondly, it means that there are going to be a whole heap of new non-employee businesses who may find the coming years a good time to grow themselves, and start hiring, thereby juicing small businesses' job-creating numbers anyway. Statistics may not lie, but they aren't always the full story, either.

Several months ago, we noted that one of the few unequivocally pro-small businesses policies put in place as part of the federal government's attempt to bailout the financial industry was the raising of the Federal Deposit Insurance Corp.'s insured-account ceiling from $100,000 to $250,000. It is small business owners, who frequently don't have business accounts, who are most likely to have personal accounts higher than $100k, and insuring them was a great boost to stability as well as the basic convenience of small business owners.

The ceiling is still raised--in fact, said raise has been made permanent (well, it's been put into effect through 2013, and if it's not made permanent or extended further before then, we'll eat our own shorts). Credit FDIC Head Sheila Bair, an altogether remarkable politician--check out this profile of her.

However, a post at OPEN Forum sounds a welcome cautionary note. FDIC coverage is not always all that it appears to be, it seems.

Specifically, there are five instances in which your FDIC coverage is not what you might expect it to be:
-If you think your bank account is a business account (which is entitled to increased protection), but the bank considers it a personal account, then it will only be insured up to $250k.
-If two banks at which you have accounts merge, then your combined account may all of a sudden turn out to be over the ceiling--and, after six months, the amount over the ceiling will be uninsured.
-If your account is non-deposit, then it's not insured. Only deposit accounts are insured. Here's the FDIC's explanation.
-If your account is at one of the 160 credit unions that use private insurance, then it's not insured by the FDIC (it is insured by a private company). Definitely something to ask about.
-If your account contains an employee benefit plan, then it's still insured, but the calculations that determine how much is insured are different; the FDIC explains here.

These caveats need not cause stress. Simply conduct some basic due diligence so that you know exactly what the federal government is insuring of your money. And then bask in the FDIC's comforting embrace.

Not that we needed it, but here is further confirmation of what we've been saying--namely, that the basic solution to surviving hard times is discounting, discounting, and more discounting. The New York Times reports that Vogue, the Condé Nast monthly (in)famously edited by Anna Wintour (who was the basis for Meryl Streep's character in The Devil Wears Prada), is showcasing...$40 Gap hats! This, despite its being "High Fashion's Bible" and long priding itself on its status as the premier fashion magazine. Such is the consumer spending climate we're living in.

Actually, an interesting nuance is that this shift in Vogue's emphasis was only partly a direct decision on the magazine's part. Another factor in the move towards highlighting more inexpensive items is that many of the designers whom Vogue would be covering no matter the economic climate are moving in that direction of their own accord (which is to say, also because of the economy). The lesson being that discounting isn't just a wise choice--it's not even really a choice, because it's where everyone else is traveling.

Meanwhile, the Times notes that Vogue hasn't completely abandoned its metier of showcasing incredibly glamorous and expensive clothes and items. Sounds to us like a smart way to maintain the integrity of their brand while still wisely adjusting to the times. We expect nothing less impressive and savvy from Wintour and her stellar magazine.

A couple days ago, the U.S. House of Representatives debated the reauthorization of the Small Business Innovation Research Program (SBIR), and the Washington Post was on the scene. We've already discussed the contentiousness of this $2.2 billion annual program, which provides federal research funding (primarily tech and life-sciences) to small businesses: one Republican congressman introduced a bill backed by the venture-capital industry that would alter the definition of small businesses under SBIR to apply to companies mostly owned by venture capitalists--they would merely have to prove that no one VC fund holds a majority stake. Predictably, the bill sent the American Small Business League practically through the roof.

Interestingly, Rep. Nydia Velazquez (D-N.Y.), who chairs the House Small Business Committee, came out in favor of the bill: "In this economy, small businesses everywhere are struggling to access capital and we should be making it easier on them, not harder." There certainly is no denying that the current definition cares less about the "small" aspect of a small business and more about its ownership. On the other hand, those venture-backed businesses do have a potential funding source that others lack, and opening the SBIR to the former would indeed take money away from the latter. Of course, VC funding is decidedly less available in the current economic climate. It is worth pointing out that VC-backed companies actually were eligible up until 2003.

So what will the outcome be? We'd bet on a compromise along the lines of an amendment introduced by Rep. Edward Markey (D-Mass.), which would allow VC-backed companies to compete for 15% of SBIR funding through the National Institutes of Health (so that would be much of the life-sciences money), and 5% of other sorts of SBIR funding. A Senate bill espouses the same idea, breaking it down 18% and 8%, respectively.

The National Venture Capital Association opposes the compromise: why, they argue, should these small businesses be treated any differently than others? We'd best every last penny we own that Lloyd Chapman's ASBL would oppose the compromise, too: why should "real" small businesses have to compete with the VC-backed ones to any extent? It's the nature of compromises that everyone's principles get betrayed in favor of something more practically workable. Such is politics!

We wanted to note something briefly about the Fairness and Transparency in Contracting Act. The bill, which we covered when it was first introduced, was submitted by Rep. Hank Johnson (D-Ga.) but penned by Lloyd Chapman of the American Small Business League. The bill would redefine small businesses for federal contracting purposes such that the subsidiaries of large businesses would no longer be eligible to be counted as small, mainly by requiring that a business that wins a federal contract be reported as its parent company. The proposed law comes in response to the revelations last year that, due to a 6% error rate, small businesses did not receive the 23% of federal contracts to which they are legally entitled. If the bill is enacted, the change could divert over $100 billion per year to small businesses, Chapman estimates.

The ASBL tends to be, politically, a pretty liberal group: in fact, they have even attacked President Obama from the left for allegedly cozying up too closely to the venture-capital industry (most notably in his selection of venture capitalist Karen G. Mills as head of the Small Business Administration). So count us surprised--pleasantly!--to find, via CNNMoney, that the National Federation of Independent Business, the most powerful small-business interest group, and one which typically finds itself on the right wing of the political spectrum, supports Chapman's bill. "Tightening the definition of small business would create significant opportunities for actual small businesses," says the NFIB's vice president of public policy. Note that pointed word "actual". Great stuff.

The NFIB deserves plaudits for supporting a bill that would so clearly benefit all small businesses, and thereby doing a wonderful job of living up to its own mission statement. We hope the U.S. Chamber of Commerce is embarassed by its reported opposition to the bill. And we hope that the bill's bipartisan support eases its passage into law.

We're...really not sure exactly how to respond to this breaking-news article in the Washington Post. Fridays are known in Washington as "Take Out The Trash Day", the time of the week when you casually release news that you want a minimal number of people to know about. So when you see a relatively thinly and mostly anonymously sourced, as well as altogether vague, story appearing at 5 P.M. on a Friday afternoon, you don't know exactly what to think.

But! The story reports that the Treasury Department is considering using some of the original $700 billion in TARP money to increase small-business lending programs, including the Small Business Administration's flagship 7(a) program as well as "an existing government program that helps small companies borrow money from banks at low rates to keep their businesses going". It's not clear whether that is in reference to 7(a) loans or perhaps the brand-new America's Recovery Capital microloan program.

Other things we learn: top economic adviser (and former Treasury Secretary) Larry Summers is skeptical of the idea where current Treasury Secretary Tim Geithner supports it. If enacted, the measure would be sold the way so many other federal programs for small business are--as investing in job creation (even if the question of whether small businesses actually create jobs is somewhat up for debate). The proposal could prove "the riskiest investment made under the bailout program to date." Karen G. Mills has become the first Small Business Administration head to be invited to join the National Economic Council (which Summers leads), "a sign," the article says, "of the administration's focus on the issue."

We also learn that any proposal would not actually be rolled out until the fall. That should give the administration ample time to iron out the details. And it should give us ample time to learn said details and present them to you. Til then, developing...

We're feeling positive this Monday morning, and so thought we'd start with a story (much like this post from a couple weeks ago) about how small businesses can actually benefit from (rather than, say, be destroyed by) big ones. Via The New Entrepreneur, we find a post from Reuters's new small-business blog, Entrepreneurial (consider it bookmarked!) on a new book arguing that Starbucks actually helped mom-and-pop coffee shops by educating consumers about fine coffee. And it links to one of our favorite-ever Slate articles, which makes essentially the same argument.

We'll let you read the post (and that Slate article!) to get a fuller idea of the specifics of the hypothesis. The broader point, though, is that frequently small businesses may find it in their interests to benefit from the big guys' brashness and size. To use two different sports metaphors, sometimes it may be wise to draft a big company, and sometimes it may be wise to go to school on their putt. When you draft someone in a distance race, you run behind them for most of the race, letting them take the wind and tire out before you pass them at the end. When you go to school on someone's putt, you observe how the green affects their ball, giving you an advantage when you try to make your putt. The big guys are going to be the ones who run out in front or putt first, because frequently they will have shareholders to answer to, and anyway won't let the threat of a few small businesses deter them from going ahead with their growth plans.

If anything, small coffeeshops have done both with Starbucks: have learned how to market gourmet coffee from Starbucks's example (indeed, as the Slate article points out, have let Starbucks do their marketing for them!), and have let Starbucks take the heat (or the wind, in the metaphor) over expensive coffee.

How can you draft a successful big business, or go to school on its putt?

Big news on the cloud computing front: none other than the behemoth of the software industry, Microsoft, has announced that its new version of its hyper-dominant Office software suite will be linked to the Internet. By the end of this year, there should be betas of PowerPoint, Excel, Word, and the rest that can allow information to be stored online, in the "cloud". This move constitutes Microsoft's response to such cloud software as the Zoho word processor and, especially, Google Apps, the search-engine giant's suite of cloud software (including the Google Docs word processor).

Additionally, as TechCrunch notes, none other than Google's just-announced ChromeOS, a cloud-compatible operating system, is a rival for Microsoft Office and even Windows: as everything increasingly moves into the cloud, even operating systems will be further integrated with the Internet. This is why we argued that even Google's Chrome browser is rivals not just with other browsers (Internet Explorer, Firefox) but also with operating systems.

So where does this leave small businesses?

We'd say it leaves them on a path where it will be easier than ever for them to go on the cloud. To call Office dominant in the office-software market is a gross understatement--it has something like an 85% or 90% slice of the market, according to the figures we've seen. No business can transfer to the cloud without Office. But now, it looks like a more complete transfer will be enabled, in turn allowing small businesses to save money and get a leg up on larger competitors.

Also don't miss Forbes, Bits, and The Big Money's Feeling Lucky on the news.

The New York Times has an absolutely fabulous piece on the damage the current recession has done to family businesses. "It’s not ‘Oh, I don’t have a job, I have to go find a new one,’" says the owner of one in Miami. “'We’re losing a corporation that is 83 years old. We’re losing our house. We’re losing our credit. We’re losing, other than our own physical bodies, everything.'” Indeed, if nothing else, the article serves as an extremely potent reminder that the recession cannot just be measured in numbers; and indeed, that among small businesses, that is especially the case.

Not that the numbers aren't there, too. We know from the ADP's monthly surveys--May's, for example--that small businesses (1-49 employees) tend to get hit hard during down times. But this article cites the Bureau of Labor Statistics's report that small businesses, by its definition--one to nineteen employees--lost over half of all lost private-sector jobs from from 2007's second quarter through 2008's third, despite accounting for only 20% of total jobs. That's shockingly disproportionate.

Still, as we say, that's not the piece's true value. Its true value is the reminder that these numbers overlook "the broader civic and social role that companies like H.A. Peterson and Sons have played since Paul Revere took over his father’s silversmith business in 1754." There's a reason, in other words, that we occasionally get sentimental over small and family-owned businesses, and it's legitimate.

Alaina Love, SPHR is the President and co-founder of Purpose Linked Consulting and lead author of The Purpose Linked Organization, a new book that explains how to link the skills, values, and passions of employees to their performance—and how doing so will bring results. Alaina joined us today for a conversation about her book.