This is a good point. They should at least expand the limit for business acounts (payroll, accounts rec, ect...) to $1m. Individual accnts at 300-500K would be OK.
FDIC has an effectively infinite budget, since Fed/Congress would print money rather than see the entire banking system become insolvent. The loss would essentially be taken via rapid inflation, rather than destruction of nominal dollar savings.
Obama is a politician nothing else, McCain is a lame old duck who has overstayed his invitation in politics. US is in trouble as firm leadership like Reagan or Clinton is missing and chaos and mess is spreading fast.
Normally it would be an IDENTICAL process to JPM's and C's "bailout" of WM and WB . The Fed's role would be as guaranteer of liabilities. For a funding action beyond the cash resources of the FDIC it would take a Congressional vote. The FDIC is NOT a "backed in full faith" entity of the Treasury. If it was, guess what? CD's would trade at PARITY with Treasuries. They don't.
This may impact small business owners looking for loans but right now small businesses arn't even close to the main problem. The main problem is banks lending to other banks.