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Obama Continues to Ignore Small Business Contracting Abuses

by | Feb 4, 2010 | Press Release

Press Release

Obama Continues to Ignore Small Business Contracting Abuses

February 4, 2010

In February of 2008, then Senator and Presidential candidate Barack Obama promised to, "end the diversion of federal small business contracts to corporate giants." Yet to date President Obama has failed to honor that promise in the face of double-digit unemployment and current legislation in Congress that would solve the problem.
 
President Obama's statement was in response to a series of federal investigations which found rampant abuses in federal small business contracting programs. 
 
Since 2003, twenty-five federal investigations have uncovered the diversion of billions of dollars a month in federal small business contracts to Fortune 500 corporations and other clearly large firms. Since taking office, Obama officials have given small business contracts to firms like Xerox, General Dynamics, Boeing, Lockheed Martin, Raytheon, and Northrop Grumman.
 
To date, President Obama has refused to propose any legislation or policy to honor that promise. As a result, the diversion of federal small business contracts to large corporations has continued.
 
The only legislation that has been introduced into Congress that would address the abuses is H.R. 2568, the Fairness and Transparency in Contracting Act. H.R. 2568 would immediately stop the diversion of federal small business contracts to corporate giants, and redirect billions of dollars in federal infrastructure funds to small businesses in the middle class economy. Congressman Hank Johnson (D-4-GA) introduced the bill in May of 2009. To date the bill has 20 co-sponsors.
 
In a statement released Thursday, U.S. Senate Committee on Small Business and Entrepreneurship Chair, Mary L. Landrieu, (D-LA) said, "Government contracts are perhaps one of the easiest and most inexpensive ways the government can help immediately increase sales for America's entrepreneurs, giving them the tools they need to keep our economy strong and create jobs. By increasing contracts to small businesses by just 1 percent, we can create more than 100,000 new jobs - and today, we need those jobs more than ever."
 
The ASBL estimates that if President Obama issued an executive order directing federal agencies and prime contractors to halt the diversion of federal small business contracts to Fortune 500 firms and other large businesses, or pass H.R. 2568, it would increase the annual volume of contracts flowing to small businesses by well over 50 percent.

Why is the Mainstream Media Allowing Obama to Cheat Small Businesses Out of Billions?

by | Feb 3, 2010 | Press Release

Press Release

Why is the Mainstream Media Allowing Obama to Cheat Small Businesses Out of Billions?

February 3, 2010

The most recent data released by the federal government indicates Fortune 500 firms and many of the largest firms in Europe are currently receiving billions of dollars a month in federal small business contracts. The latest data released by the Obama Administration indicates Textron Inc. was the largest recipient of federal small business contracts. Textron is a Fortune 500 firm with 43,000 employees and annual sales over $14 billion. Textron received over $775 million in federal small business contracts in a single year.

TARP has failed, national unemployment is over 10 percent and no journalist has ever asked President Obama why his administration continues to give billions of dollars a month in federal small business contracts to Fortune 500 firms.

The Small Business Act requires a minimum of 23 percent of the total value of all federal prime contracts be awarded to small businesses. According to Small Business Administration (SBA) Administrator Karen Mills, roughly $150 billion a year in federal contracts should be awarded to small businesses. http://www.nytimes.com/2009/10/30/business/smallbusiness/30mills.html?_r=2

According to the latest data from the U.S. Census Bureau, small businesses are responsible for over 97 percent of all net new jobs in America. A recent report from the Kauffman Foundation found that since 1980 nearly all net new jobs in America have come from companies that are less than five-years-old.

The 23 percent federal small business contracting goal represents the single largest federal program ever established to create jobs and boost America's middle class economy.

Since 2003, over a dozen federal investigations have found billions of dollars a month in federal small business contracts have been diverted to Fortune 500 firms and thousands of the largest companies around the world.

In Report 5-15, the SBA Office of Inspector General (IG) referred to the problem as, "One of the most important challenges facing the Small Business Administration and the entire Federal government today." https://www.asbl.com/documents/05-15.pdf For the last five consecutive years, the SBA IG has reported the diversion of federal small business contracts to large businesses as the #1 management challenge facing the agency.

In February of 2008, President Obama recognized the magnitude of this problem by stating, "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, President Obama has refused to adopt any policy or legislation to honor that campaign promise; as a result the rampant abuses have been allowed to continue. No journalist has ever asked President Obama why he refused to honor that campaign promise.

America is in the midst of its worst economic disaster in 80-years. Small businesses are responsible for virtually 100 percent of all net new jobs and President Obama is allowing the vast majority of federal small business contracts, which by law should be going to middle class firms, to be diverted to corporate giants around the world.

No program proposed by President Obama or Congress would direct more money to the middle class or create as many new jobs as simply ending the diversion of billions of dollars a year in federal small business contracts to corporate giants.

Over the last year, President Obama has continued to read well-written speeches about the importance of small businesses, his focus on jobs and the economy.  While the words are fresh on his tongue, President Obama hypocritically presides over the blatant corruption of the single largest federal program ever enacted to direct federal infrastructure spending to the middle class and create jobs.  Not one journalist has ever asked President Obama or any member of his administration why these abuses have been allowed to continue.

Obama Small Business Plan Criticized for Hypocrisy

by | Feb 2, 2010 | Press Release

Press Release

Obama Small Business Plan Criticized for Hypocrisy

February 2, 2010

The American Small Business League (ASBL) criticizes President Barack Obama’s latest
Plan to stimulate small businesses and the middle class economy for being hypocritical. Following last week’s State of the Union address, President Obama proposed a series of initiatives for small businesses including a $5,000 per new employee tax credit, and the establishment of a $30 billion small-business lending fund created from leftover TARP money. While the President Obama’s recent rhetoric has been focused on small businesses and job creation, over its first year his administration has allowed the diversion of billions of dollars in federal small business contracts to Fortune 500 firms to continue. As a result thousands of businesses have failed and countless jobs have been lost. (https://www.asbl.com/documents/20090825TopSmallBusinessContractors2008.pdf)
 
The Small Business Act directs that the federal government awards small businesses, “not less than 23 percent of the total value of all prime contract awards for each fiscal year.” Since 2003, over a dozen federal investigations have found that the federal government is not hitting that goal, and that a majority of federal small business contracts have been diverted to Fortune 500 firms. (http://www.smallbusinessnotes.com/fedgovernment/sba/sbact.html)
 
In Report 5-15, the Small Business Administration (SBA) Office of Inspector General
referred to the diversion of federal small business contracts to corporate giants as, “One of the most important challenges facing the Small Business Administration (SBA) and the entire Federal Government today.”(https://www.asbl.com/documents/05-15.pdf) In October of 2009, the SBA IG referenced this issue as the #1 management challenge facing the agency for the fifth consecutive year. (http://www.sba.gov/idc/groups/public/documents/sba_homepage/oig_reports_tmc_fy10.pdf)
 
In February of 2008, President Obama recognized the magnitude of the problem when he stated, “It is time to end the diversion of federal small business contracts to corporate giants.” Two years later, the latest government data clearly shows the Obama Administration is continuing to award billions of dollars a month in federal small business contracts to large businesses.
 
The American Small Business League believes if President Obama really wanted to create jobs he would do the following:
 
1. Issue an executive order to end the diversion of federal small business contracts to corporate giants or pass H.R. 2568, the Fairness and Transparency in Contracting. https://www.asbl.com/documents/hr2568.pdf 
2. Institute the 5 percent set-aside goal for women-owned firms.
3. Restore the SBA’s budget and staffing, and open all of the small business offices closed during the Bush Administration.
4. End the comprehensive test program, which allows government prime contractors to circumvent their small business contracting goals. https://www.asbl.com/showmedia.php?id=1000