Petaluma, Calif. - Despite President Obama's promise of increased transparency in government, the Small Business Administration (SBA) is moving ahead with its appeal of a San Francisco District Court ruling directing it to release small business contracting data to the American Small Business League (ASBL). The 9th Circuit Court of Appeals will now hear the case.  The SBA must file its appellate brief with the court by March 20.

Under the Freedom of Information Act (FOIA), the ASBL requested the names of all firms that had received federal small business contracts during fiscal years (FY) 2005 and 2006. During proceedings in United States District Court, Northern District of California, SBA attorneys attempted to convince United States District Judge Marilyn H. Patel that the agency did not possess any information on the actual recipients of federal small business contracts.                  

Patel rejected the SBA's excuse in her ruling in favor of the ASBL stating, "The court finds curious the SBA's argument that it does not 'control' the very information it needs to carry out its duties and functions."
(www.asbl.com/documents/26-2.pdf) 

The ASBL has won a series of FOIA cases against the SBA, NASA and the Pentagon, which have proven that the SBA dramatically inflated government small business contracting statistics. The information indicated that billions of dollars in contracts the SBA reported as going to small businesses had been diverted to Fortune 500 firms, their subsidiaries and thousands of other large businesses in United States and even Europe.

Since 2003, over a dozen federal investigations have found widespread fraud and abuse in virtually every small business program administered by the SBA. Several investigations found large businesses had received federal small business contracts fraudulently through "false certifications," "improper certifications" and "vendor deception."
(http://www.sba.gov/IG/05-16.pdf) 

In Report 5-14, the SBA's own Office of Inspector General found the SBA had reported contracts to several large businesses as small business awards, including Dutch conglomerate Buhrmann NV with more than 26,000 employees worldwide. (http://www.sba.gov/IG/05-14.pdf) 

SBA Press Office Director Mike Stamler has managed an extensive SBA media campaign to portray the billions of dollars in fraud and abuse in federal small business contracting programs as a "myth." (www.asbl.com/documents/sbamythvfact.pdf) With the help of several journalists, the ASBL has obtained evidence indicating Stamler has also made libelous and slanderous statements about the ASBL.

The ASBL is preparing to file another FOIA lawsuit against the SBA for refusing to comply with a FOIA request for e-mails Stamler sent members of the press in an attempt to slander ASBL President Lloyd Chapman.

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Petaluma, Calif. - President Barack Obama hopes the stimulus bill will create jobs and stimulate America's faltering economy with approximately $550 billion in additional government spending over the next few years.
 
In addition to new spending, the stimulus bill should have included provisions to address over $600 billion a year the government currently spends in a manner that would have created even more jobs. 

One of the most effective economic stimulus bills ever passed by Congress was the Small Business Act of 1953. Current federal law based on the Small Business Act, stipulates that a minimum of 23 percent of all federal contracts and sub-contracts be awarded to small businesses. Congress passed the Small Business Act based on the realization that most Americans are employed by small businesses. The same statistics hold true today.

The most recent U.S. Census Bureau data indicates that firms with less than 20 employees account for 90 percent of all U.S. firms and are responsible for more than 97 percent of all new jobs in America. These firms also employ approximately 50 percent of all private sector workers. Economic experts agree, directing federal infrastructure spending to small business is the most efficient way to create jobs and stimulate the economy. (http://www.inc.com/news/articles/200708/data.html) 

Since 2003, over a dozen federal investigations found fraud and dramatic abuses in virtually every federal small business contracting program. Several investigations found hundreds of billions of dollars in federal contracts earmarked for small businesses were diverted to Fortune 500 firms. ABC, CBS and CNN aired stories on the abuses. (ABC, https://www.asbl.com/abc_evening_news.wmv; CBS, https://www.asbl.com/cbs.wmv; CNN, https://www.asbl.com/showmedia.php?id=1170) 

Based on all available data, it would appear that the simplest and most effective method of stimulating the national economy and creating jobs would be to stop the dramatic abuses in existing government economic stimulus programs.

President Obama recognized the magnitude of this problem as early as February of 2008 when he released the statement, "Small businesses are the backbone of our nation's economy and we must protect this great resource. It is time to end the diversion of federal small business contracts to corporate giants." (http://www.barackobama.com/2008/02/26/the_american_small_business_le.php) 

The simplest way for President Obama to stimulate the economy is to make good on that campaign promise. He should bring an end to the fraud and abuses that have diverted hundreds of billions of dollars in federal small business contracts away from America's nearly 27 million hardworking small businesses, that create over 97 percent of all new jobs.

Millions of jobs could be created using existing federal programs at no additional cost to taxpayers.

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Petaluma, Calif. – In February of 2008, President Obama released the following statement, "Small businesses are the backbone of our nation's economy and we must protect this great resource. It is time to end the diversion of federal small business contracts to corporate giants." (http://www.barackobama.com/2008/02/26/the_american_small_business_le.php) 

President Obama's statement was made in response to a series of over 15 federal investigations, which found the Bush Administration had diverted billions of dollars in federal small business contracts to Fortune 500 firms and thousands of other large businesses.

Investigative stories released by ABC, CBS and CNN (ABC, https://www.asbl.com/abc_evening_news.wmv; CBS, https://www.asbl.com/cbs.wmv; CNN, https://www.asbl.com/showmedia.php?id=1170) confirmed that many of the nation's top defense contractors were the actual recipients of most federal small business contracts. Firms such as Lockheed Martin, Boeing, General Dynamics, Raytheon, L-3 Communications, Northrop Grumman and Titan Industries received billions of dollars in U.S. government contracts reported as going to small businesses.

The Small Business Administration (SBA) Office of Inspector General (OIG) released Report 5-15 which stated, "One of the most important challenges facing the Small Business Administration and the entire Federal government today is that large businesses are receiving small business procurement awards and agencies are receiving credit for these awards." (http://www.sba.gov/IG/05-15.pdf) 

A 2007 report from the SBA Office of Advocacy based on U.S. Census Bureau statistics found businesses with fewer than 20 employees were responsible for more than 97 percent of new jobs in America. CNNMoney.com and Inc.com released stories on the findings. (http://www.inc.com/news/articles/200708/data.html ; http://money.cnn.com/2008/07/30/smallbusiness/job_creation.fsb/index.htm)   
The American Small Business League (ASBL) is hoping to encourage President Obama and Congress to support draft legislation titled, the Fairness and Transparency in Contracting Act, which will keep President Obama's campaign promise to the small business community and create millions of new jobs.

The new legislation was drafted by the ASBL and is based on original provisions of the Small Business Act, which define a small business as "independently owned."  The legislation would exclude publicly traded firms from being counted towards the federal government's small business procurement goal. The essence of the ASBL legislation states, "The federal government and prime contractors can no longer report awards to publicly traded firms as small business awards."

"Everybody in America knows Fortune 500 firms should not be allowed to hijack government small business contracts. Seven years, 15 federal investigations, hundreds of stories in the press and thousands of hard working small businesses forced into bankruptcy are enough," ASBL President Lloyd Chapman said. "It is time for President Obama to do what he said he would do during the campaign and stop the diversion of hundreds of billions of dollars in federal small business contracts to corporate giants." 

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Petaluma, Calif. - According to the latest United States Census Bureau statistics, businesses with fewer than 20 employees account for 90 percent of all U.S. firms and are responsible for more than 97 percent of all new jobs. The Small Business Administration (SBA) Office of Advocacy released a report on the Census Bureau findings. (http://www.inc.com/news/articles/200708/data.html) 

CNNMoney.com and Inc.com released stories on the SBA report. (http://money.cnn.com/2008/07/30/smallbusiness/job_creation.fsb/index.htm) 

Since 2003, a series of more than 15 federal investigations have uncovered that the Bush Administration allowed billions of dollars in federal contracts earmarked for small businesses to be diverted to Fortune 500 firms and thousands of clearly large businesses around the world. (https://www.asbl.com/documentlibrary.html) 

Neither the House, nor Senate versions of the economic stimulus package contain any provisions to address the diversion of federal small business contracts to Fortune 500 firms.  Additionally, the bills fall short of addressing the needs of America's top job creators.

Hundreds of stories chronicling the diversion of federal small business contracts to corporate giants have been released by virtually every major newspaper in the country. (https://www.asbl.com/news.php) Major television networks like CBS, ABC, FOX and CNN have covered the story.
(ABC, https://www.asbl.com/abc_evening_news.wmv; CBS, https://www.asbl.com/cbs.wmv; FOX, http://www.youtube.com/watch?v=8y2F8zl2ebs; CNN, https://www.asbl.com/showmedia.php?id=1170)

In 2005, the SBA Office of Inspector General released Report 5-15, which described the diversion of federal small business contracts to Fortune 500 firms as, "One of the most important challenges facing the Small Business Administration and the entire Federal government today." (http://www.sba.gov/IG/05-15.pdf) 

In February 2008, President Obama released the following statement, "Small businesses are the backbone of our nation's economy and we must protect this great resource. It is time to end the diversion of federal small business contracts to corporate giants." (http://www.barackobama.com/2008/02/26/the_american_small_business_le.php) To date, he has not proposed even a single policy to make good on his campaign promise.

Based on information obtained through a series of successful Freedom of Information Act (FOIA) lawsuits against the Bush Administration, the American Small Business League (ASBL) estimates that every year up to $100 billion in federal contracts earmarked for America's top job creators are diverted to corporate giants in the defense industry.

On December 6, President Obama's transition team estimated that every billion dollars spent on federal infrastructure projects would create 40,000 jobs. (http://www.nytimes.com/2008/12/07/us/politics/07radio.html)  

The ASBL estimates that a provision in the stimulus bill that would end the diversion of federal small business contracts to corporate giants could create up to 4 million new jobs.

The powerful lobby for the defense industry has successfully blocked any attempts at legislation to stop the flow of billions of dollars in government small business contracts to many of the largest defense contractors in the country.

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