60% of Private Businesses and Private Lenders
Say an Increase in the $14.3 Trillion U.S. Federal
Debt Ceiling Would Be Detrimental to the
Economy in the Next 12 Months
l Pepperdine University Graziadio School Study Also Shows Only 7% of Private Businesses and Private
Lenders Say an Increase in the Debt Ceiling Would Be Beneficial
January 07, 2011 06:03 AM Eastern Time
LOS ANGELES--(EON: Enhanced Online News)--As the nation’s legislators face decisions about raising the
nation’s $14.3 trillion debt ceiling, a survey from Pepperdine University’s Graziadio School of Business and
Management shows 60% of privately-held businesses, capital suppliers, intermediaries, and service providers say an
increase would be somewhat detrimental (29%) or detrimental (31%) to the economy over the next twelve months.
Conversely, the survey (http://bit.ly/usdebtsurvey) among 915 privately-held businesses, capital suppliers,
intermediaries, and service providers also shows that 22% of private businesses and lenders say raising the debt
ceiling would be “somewhat beneficial” (15%) or “beneficial” (7%). Nineteen percent of respondents said “neutral.”
These findings are part of data expected to be released within the next two weeks from the Pepperdine Private
Capital Markets Project (http://bschool.pepperdine.edu/privatecapital), an investigation of the major private capital
markets that examines the current state and outlook for the private capital industry.
“The majority of private privately-held businesses, capital suppliers, intermediaries, and service providers recognize
the short and long-term harm to the economy if we dig deeper and deeper into debt,” said Dr. John Paglia, lead
researcher of the Private Capital Markets Project and associate professor of finance at Pepperdine University’s
Graziadio School of Business and Management. “Small businesses and lenders who serve small businesses have had
to deal with the economic reality of limited borrowing and lending for the last three years. They may feel that a similar
reality has eluded the Federal government and it is time to start owning up.”
With over 99% of companies having fewer than 500 employees, our economy is dependent upon the success of
small businesses. The Pepperdine Private Capital Markets Project is a critical step along the path of understanding
and increasing the value of private companies and our economy. Professionals who work in the lending or investment
arenas either for an institution or a specific fund are excellent bellwethers of what is ahead for other businesses and
consumers. Through two survey cycles and published summary reports per year, lenders, investors and the
businesses that depend on them will be able to make optimal investment and financing decisions, and better
determine where the opportunities to create lasting economic value may be realized.
The study is available at: http://bschool.pepperdine.edu/privatecapital.
About the Graziadio School of Business and Management
Founded on the core values of integrity, stewardship, courage, and compassion, Pepperdine University’s Graziadio
(GRAT-ZEE-ah-DEE-oh) School of Business and Management has been developing values-centered leaders and
advancing responsible business practice since 1969. Student-focused, experience-driven, and globally-oriented, the
Graziadio School offers fully accredited MBA, Masters of Science, and bachelor’s completion business programs.
More information found at http://bschool.pepperdine.edu/newsroom/.
Graziadio School of Business and Management
Douglass Gore, Director of Public Relations