Obama Proposes Tax Cut for Mega Rich Venture Capitalist Contributors

Press Release

Obama Proposes Tax Cut for Mega Rich Venture Capitalist Contributors

May 28, 2010

President Barack Obama has proposed new legislation that will allow many of the nation's wealthiest venture capitalists to avoid paying billions of dollars in federal income tax. Under the new proposal some of President Obama's top campaign contributors in the venture capital industry will be exempt from capital gains tax.

I believe President Obama will also back legislation and policy that will attempt to change the longstanding federal definition of a small business as being "independently owned." President Obama will likely back legislation or policy that will change the federal definition of a small business to include firms owned by many of the nation's wealthiest venture capitalists.

If he is successful, billions of dollars a month in federal small business contracts will be diverted from legitimate small businesses, and into the hands of mega wealthy venture capitalists.

President Obama has maintained close ties to the National Venture Capital Association (NVCA) since his days in the Illinois State Legislature. Wealthy venture capitalists were major contributors to President Obama's campaign. In February of 2009, a story in the Venture Capital Journal titled, "Real Change: New President Gets VC," boasted about the close relationship between President Obama and the venture capital industry. (http://www.vcjnews.com/story.asp?storycode=46450)

President Obama's close ties and political debt to the venture capital industry were clearly demonstrated when he appointed New York venture capitalist, and Tootsie Roll heiress Karen Mills to head the Small Business Administration (SBA). He appointed another venture capitalist, Winslow Sargeant to head the Small Business Administration Office of Advocacy. Both Mills and Sargeant were major contributors and fund raisers during Obama's Presidential campaign.

In addition to millions of dollars in contributions to President Obama, the NVCA and its members have spent millions of dollars lobbying Congress. The vast majority of venture capital industry contributions have been focused on the House and Senate small business committees. A story in AllBusiness.com described House Small Business Committee Chair Nydia Velázquez as "quarterbacking" legislation for well-heeled venture capitalists. (http://www.allbusiness.com/company-activities-management/business-climate-conditions/9077284-1.html)

In the past, the NVCA and its members have pushed for pro-venture capital loopholes under the guise of "increasing access to capital for small businesses." Nothing could be further from the truth. In reality, the true purpose of the NVCA political agenda is obviously to increase their access to billions of dollars in federal small business contracts and withdraw profits without paying taxes.

According to the U.S. Census Bureau and the Kauffman Foundation, small businesses employ over 50.2 percent of the private sector workforce, are responsible for more than 50 percent of GDP and create nearly all net new jobs. Legislation or policy that would divert federal small business funds away from American small businesses could have a significant negative impact on the national economy.

If President Obama truly wanted to increase access to capital for small businesses, he would not have allowed CIT, the nation's leading lender to small businesses and firms owned by women, minorities and veterans, to fail. If President Obama were sincere about helping small businesses, he would have kept his campaign promises to: implement the 5 percent set-aside goal for woman owned firms, restore the SBA's budget and staffing, restore the head of the SBA to a cabinet level position, and "end the diversion of federal small business contracts to corporate giants." (https://www.asbl.com/documents/20100526_ASBL_AnalysisObamaSB.pdf)

President Obama has broken every campaign promise he made to America's 27 million small business owners. Instead he has continued to allow billions of dollars a month in federal small business funds to be diverted to corporate giants around the world. His administration has tried to cover up the diversion of federal small business contacts to corporate giants by destroying data in the Federal Procurement Data System such as the "small business flag" and the "parent DUNS number." The Obama Administration is refusing to release a wide variety of information that the public can use to monitor the actual recipients of federal small business contracts. They have also refused to release reports on prime contractor compliance with federal small business goals. President Obama even refused to accept the recommendation of his own small business advisory council to end the "Comprehensive Subcontracting Plan Test Program." This program allows prime contractors to ignore federally mandated small business goals and avoid any penalties for noncompliance.

As I have said many times, the media and the American people need to quit listening to President Obama's well written and insincere speeches, and look at what he is actually doing. When you do, it becomes clear that President Barack Obama is no friend to the 27 million small businesses where most American's work. Quite the contrary, his administration has adopted numerous policies that are clearly anti-small business.

I predict that President Obama will continue to pursue legislation and policy that will allow his wealthy contributors in the venture capital industry to hijack billions of dollars in federal small business contracts and avoid paying taxes on their ill gotten gains.

American Small Business League not satisfied with Obama's small business stance


American Small Business League not satisfied with Obama's small business stance

May 28, 2010

President Barack Obama has a come under fire for failing to address major concerns of small businesses, according to a new report by the American Small Business League.

The group claims that the president has failed to deliver on campaign promises he made involving small businesses. Most concerning to the League was the administration's failure to stop large corporations from receiving $100 billion a year in federal small business contracts. As far back as 2003, according to the report, more than a dozen federal investigations revealed that billions of dollars that were set aside to be used by small businesses were co-opted by major corporations such as Lockheed Martin, Boeing, Dell Computers and Xerox.

Other issues the group had with the Obama administration included the failure to restore the budget of the Small Business Administration to pre-Bush administration levels and the refusal to provide financial assistance to small business lender CIT during the summer of 2009.

The Obama administration met with small business leaders from around the country this week in honor of Small Business Week. Though not everyone is satisfied with his policies, the president has made the issue of small business a focus of his agenda in recent weeks, asking Congress to pass new legislation concerning small businesses.

Source: http://www.123print.com/News/American-Small-Business-League-not-satisfied-with-Obamas-small-business-stance-265

Why Washington's Worth Watching


Why Washington's Worth Watching

The Obama administration has shown great interest in small-business owners, but some still wonder when they'll see results to match.

By David Port
May 28, 2010

It's National Small Business Week in Washington, D.C., time to celebrate the entrepreneurs and businesses that, according to President Barack Obama, form "the backbone of the nation's economy." But the roster of sponsors for the 47th annual observance of the occasion reads more like a Who's Who of corporate behemoths, dominated by names like Sam's Club, Visa, Ford, Raytheon and AT&T.

Dichotomies like that are feeding an undercurrent of concern in some quarters of the small-business community. The worry is that in Washington, policy-makers are continuing to let big business crash the small-business party, just as they did when George W. Bush ran things--despite a host of new pro-entrepreneur initiatives and the Obama administration voicing steadfast support for small business.

The tension isn't new. Indeed, Lesa Mitchell, vice president at the Kauffman Foundation, calls the dynamic between entrepreneurial interests and the Washington, D.C., policy-making machine "very schizophrenic."

Even so, Mitchell and other voices in the entrepreneurship movement laud the Obama administration's work in furthering the small-business cause, pointing to recent developments such as implementation of the American Recovery and Reinvestment Act, plus the administration's move to address government small-business contracting practices, to create an Office of Innovation and Entrepreneurship, and to push legislation to establish a new small-business lending fund.

"Historically, this is by far the greatest level of interest [in entrepreneurship and small business] we have seen from any administration," says Mitchell. "And that is a bipartisan comment."

The Obama administration is backing up that interest with action, asserts Karen G. Mills, who heads the U.S. Small Business Administration, pointing to "a very comprehensive and exciting agenda about small business all across the administration, but particularly here at this agency."

Yet other small-business advocates, along with business owners such as Mike Mitternight, wonder whether they have a true ally in the White House, and whether policy-makers inside the Beltway are inclined to do anything substantial to help small businesses.

"They all seem to be talking about small business as the backbone of the economy," says Mitternight, owner of Factory Service Agency, Inc., a family-owned commercial air conditioning and construction company in Metairie, La. "But they don't seem to be backing that up with policies that help us. Politicians are giving us their ear. They're giving [small businesses] a chance to speak--not that they necessarily listen to what we say. Really, it seems like they're putting a bigger burden on our backs."

"I think [small-business owners] are frustrated [with Washington policies], quite frankly," says Molly Brogan, vice president of public affairs for the National Small Business Association. "[There have been] so many things Congress had an opportunity to pass, and they haven't done it. But…at least they are talking about small-business issues a lot more than they had been."

Yet talk hasn't always translated into action, Brogan contends, listing last year's overhaul of credit card regulation among many missed policy opportunities to help small business.

That inaction also extends to issues such as the SBA's failure to meet its target for awarding government contracts to small business, says longtime SBA critic Lloyd Chapman, head of the American Small Business League. The Obama administration's small-business policy is more "smoke and mirrors" than substance, he says, while Obama and Mills themselves "are what I would characterize as anti-small business."

Nonetheless, U.S. entrepreneurial activity is growing. According to the Kauffman Index of Entrepreneurial Activity, business startups reached their highest level in 15 years after a 4 percent increase in 2009. However, existing small businesses continue to struggle. According to a January NSBA report, the number of small businesses citing decreases in revenue over the past 12 months rose to its highest point since 1993. Meanwhile, 39 percent of small businesses report they are unable to get adequate financing for their business.

Among the many small-business issues under discussion in Washington, loan access sits near the top of the agenda. Mitternight, who as a New Orleans-area business owner witnessed the much-maligned SBA disaster loan program in action in the wake of Hurricane Katrina, says he sees evidence that the agency "has improved their lending procedures" since then.

Through the American Recovery and Reinvestment Act, SBA figures indicate that the agency has supported more than $26 billion in loans to small businesses while increasing the number of lenders making loans. Also part of the act, it eliminated and reduced loan fees, while raising the guarantee on certain loans. According to Mills, the Obama administration is seeking to extend those provisions through the end of 2010, and to raise SBA loan limits from $2 million to $5 million.

"There are a lot of companies--manufacturers, franchises--that need the larger loan size, and [some of] the players in the market that used to provide that type of funding are still absent, so we need to step up and fill that gap," Mills explains. "We've also asked for the ability to use our 504 [loan] program to refinance owner-occupied real estate, understanding banks are going to need credit support."

More help could be on the way in the form of White House-endorsed legislation introduced this spring that would create a $30 billion lending fund designed to increase small-business lending by community banks. The measure is currently making its way through the U.S. Senate.

Even without that fund, the outlook for SBA small-business loans is improving, says the National Small Business Association's Brogan. "They're not quite at pre-2007 levels, but they have rebounded. It's very encouraging." Still, she adds, "the credit crunch is ongoing."

Government small-business contracting practices are another hot-button issue. According to the American Small Business League's Chapman, the diversion of contracts to large corporations is the "number one problem" at the SBA.

Noting that Uncle Sam consistently falls short of meeting the goal of awarding at least 23 percent of all federal contracting dollars to small business, the president in April announced formation of two task forces aimed at improving small-business contracting with federal agencies. One, the Interagency Task Force on Federal Contracting Opportunities for Small Businesses, is co-chaired by Mills. Sometime this summer, it is due to provide the White House with recommendations for making government contracts more accessible to small businesses.

The fact that there's a range of other initiatives means there will be plenty for Small Business Week participants to discuss during this week's festivities in Washington. For example, there's the status of the administration's Strategy for American Innovation, a blueprint for how the federal government will invest in high-growth entrepreneurship and other economic building blocks. There's the work of the new Office of Innovation and Entrepreneurship within the Commerce Department, which is geared toward the first step in the business cycle: turning an idea into a business plan. The new i6 Challenge, a $12 million competition soliciting ideas to drive technology commercialization and entrepreneurship, is among the office's first programs. There's also the new Entrepreneurship.gov website launched last year by the Kauffman Foundation and the Commerce Department to improve the global environment for entrepreneurship.

Also worth watching, according to Kauffman's Mitchell, is a proposed startup visa program that would allow an immigrant entrepreneur to receive a two-year visa by showing that a qualified U.S. investor is willing to dedicate at least $250,000 to the immigrant's startup venture. Bipartisan legislation to create such a program was introduced in February and is still pending.

Given what's at stake, Mitternight suggests that small-business owners pay close attention to developments in Washington. "Up until a couple years ago, I never felt as though what happened inside the Beltway could affect us much," he says. "But I was wrong. What happens there does have a significant impact on small businesses."

Source: http://www.entrepreneur.com/growyourbusiness/businessstrategies/article206820.html

New In-depth Report Challenges Obama Small Business Track Record

Press Release

New In-depth Report Challenges Obama Small Business Track Record

May 27, 2010

Petaluma, Calif. – The American Small Business League (ASBL) has concluded an examination and report on President Barack Obama's track record for small businesses, and uncovered a dramatic disparity between President Obama's rhetoric and his actions. (https://www.asbl.com/documents/20100526_ASBL_AnalysisObamaSB.pdf)  

In its report the ASBL outlines a series of major failures by the Obama Administration.  These failures represent broken campaign promises and failures by the administration to recognize the needs of America's chief job creators: Small businesses. 

The ASBL investigation was spurred by the administration's refusal to stop the diversion of more than $100 billion a year in federal small business contracts to some of the largest corporations in the United States and Europe.  Since 2003, more than a dozen federal investigations have uncovered billions of dollars in federal small business contracts diverted to corporate giants like Lockheed Martin, Boeing, Dell Computer, Xerox, Office Depot, Starwood Hotels, Raytheon, General Dynamics and French giant Thales Communications.

The ASBL's report found that the Obama Administration has:
1. Failed to adopt any policies or legislation to stop the diversion of federal small business contracts to corporate giants.
2. Reduced overall transparency in federal small business contracting data by eliminating fields such as the "small business flag" and "parent DUNS number."
3. Failed to restore the Small Business Administration's (SBA) budget and staffing to pre-Bush Administration levels.
4. Failed to implement the recommendations of his campaign's small business advisory council, which provided solutions to a wide array of small business problems.
5. Failed to stop the dismantling of minority set-aside programs.  During the Obama Administration's first months the Rothe Decision virtually nullified small business programs for minorities.
6. Failed to provide assistance to major small business lender CIT during the summer of 2009.
7. Failed to allocate more than 3 percent of stimulus funds to small businesses.
8. Destroyed a decade's worth of federal contracting data used to identify fraudulent contractors.
9. Reduced the availability of documents on small business contracting programs under the Freedom of Information Act (FOIA).
10. Failed to curb widespread fraud in veteran-owned small business programs.
11. Failed to bring an end to the Comprehensive Subcontracting Plan Test Program, which allows prime contractors to circumvent their small business subcontracting goals.
12. Failed to implement the 5 percent set-aside goal for women-owned small businesses.

"If you quit listening to what he says and just look at what he's done, these are not the actions of a pro-small business president," ASBL President Lloyd Chapman said.


Please click here to view a copy of the ASBL’s report:  https://www.asbl.com/documents/20100526_ASBL_AnalysisObamaSB.pdf


Obama Small Business Task Force Will Likely Threaten Small Business Programs

Press Release

Obama Small Business Task Force Will Likely Threaten Small Business Programs

May 25, 2010

On April 26th, President Barack Obama established a Small Business Task Force to supposedly remove barriers to small businesses landing contracts with the federal government. I had to laugh out loud. This was amusing to me for many reasons, but most notably, President Obama ignored the recommendations of his last small business task force. It was established during his presidential campaign, and I was on it.

We spent months coming up with solid and practical solutions to help small businesses. He never adopted a single one of our recommendations. It turned out to be the first of many Obama, "all talk and no action," programs for small businesses.

In my humble opinion, the number one barrier to small businesses landing more federal contracts is President Obama himself. All you need to do is take a quick look at President Obama's actual track record for small businesses to predict what the recommendations of his small business task force will be.

Since 2003, a series of federal investigations have found that most federal small business contracts actually go to Fortune 500 firms. Report 5-15 from the Small Business Administration (SBA) Inspector General referred to the rampant fraud and abuse 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) The SBA IG has reported this as the number one management challenge facing the SBA for the last five consecutive years.

The latest data released by the Obama Administration clearly, and undeniably, shows the largest recipient of federal small business contracts last year was Textron, Inc., a Fortune 500 firm with over 43,000 employees and over $14 billion a year in annual revenue. Other firms that received U.S. government small business contracts included, Lockheed Martin, Dell Computer, Xerox, General Dynamics, ManTech, Raytheon, Boeing, Office Depot and General Electric.

President Obama was clearly aware of this issue in February of 2008, when he released the statement, "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 consistently refused to adopt any polices to keep his campaign promise and end the daily flow of over $400 million a day in federal small business contracts to corporate giants.

It gets worse. On March 12th of this year the Obama Administration removed, and potentially permanently destroyed ten-years worth of data that had been used by federal investigators to uncover billions of dollars in fraud and abuse in federal small business contracting programs. Obama officials removed the "small business flag," field, in which Fortune 500 firms have illegally misrepresented themselves as small businesses for years. Report 5-16 from the SBA IG referred to these misrepresentations as, "false certifications" and "improper certifications." Other federal investigations described the blatant fraud as "vendor deception." Now all evidence of the abuses has been removed.

If you are part of a small minority or disadvantaged firm you probably won't believe this, so I will give you a link to the actual federal document. Shortly after taking office, the primary federal program to help direct a miniscule 5% of federal contracts to minorities was dismantled. Obama choose not to appeal a circuit court ruling which found that minority-contracting programs were unconstitutional. How about that? The first African American President and Attorney General are doing absolutely nothing as federal minority contracting programs are being dismantled. Federal contracts to minority-owned firms have fallen off a cliff since President Obama has taken office. (http://www.acq.osd.mil/osbp/policy/USA001376-09%20Signed.pdf)

Finally, during his 2008 campaign, President Obama promised to implement a federal law passed in 2000 establishing a 5% set-aside contracting goal for woman-owned firms. To date, the program has not been implemented. Lots of talk, but no action. My guess is if he finally does implement it, it will be so watered down it won't make much of a difference.

Need more proof Obama doesn't give a rat's "you know what" about America's 27 million small businesses? How about the American Reinvestment and Recovery Act (ARRA)? According to the U.S. Census Bureau, and private studies by groups like the Kaufman Foundation, small businesses are responsible for virtually 100% of all net new jobs in America. 100%! Go ahead and guess how much of the ARRA funds President Obama allocated to small businesses so far. Before I tell you, let me ask you one question: if you were trying to stimulate the economy and create jobs and you knew small businesses were responsible for 100% of all net new jobs in America, how much would you allocate for small businesses? 50%, 70%, 100%?

To date, President Obama has allocated approximately 3% of the ARRA funds to small businesses.

I plan to write a series of articles regarding my predictions of the Obama small business task force proposals. I can promise you right now, there is one thing you absolutely will not see in their recommendations. No legislation or policy of any kind will be proposed that will stop, "One of the most important challenges facing the Small Business Administration and the entire Federal government today," the diversion of billions of dollars a year in federal small business contracts to corporate giants.