On Monday, June 28, over 300 angry small business owners attended an Obama Administration small business forum at the U.S. Department of Commerce. Obama Administration officials who hosted a series of discussion groups were bombarded with complaints from hostile small business owners regarding a variety of subjects. A common theme shared by many attendees was anger over having to compete against large businesses for federal small business contracts.

Dozens of attendees were visibly irritated when Small Business Administration Administrator Karen Mills attempted to claim 30 percent of contract dollars allocated under the federal stimulus went to small businesses. The American Small Business League (ASBL) estimates that small businesses received less than three percent of stimulus funds.

Mill’s comments raised eyebrows again when she claimed that small business contracting information coming from the SBA was “clean and accurate.”

As recently as February of 2010, the inspector general for the SBA found that the agency itself was awarding more than 30 percent of its own small business contracts to large businesses. Additionally, the report found that 97 percent of the contracts reviewed contained erroneous data.
http://www.sba.gov/idc/groups/public/documents/sba_homepage/oig_report_10-08.pdf

One attendee commented that if President Obama really wanted to help small businesses, he would honor his campaign promise 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)

In Administrator Mill’s closing comments she promised that comments from the meeting would be included in the Obama interagency small business taskforce recommendations.

The ASBL predicts, that in reality, none of the comments from the small business community will be included in the taskforce’s recommendations. Quite to the contrary, the ASBL strongly believes the Obama Administration will use the task force to roll out a variety of anti small business policies, such as changing the definition of small business from independently owned to include firms owned and controlled by some of the nation’s wealthiest venture capitalists.

“In the four hour meeting not one person recommended that the federal definition of a small business, as being independently owned, be modified in any way,” ASBL President Lloyd Chapman said. “Since President Obama appointed a venture capitalist to head the SBA and the SBA Office of Advocacy, I am expecting that they’ll try to break up the SBA and change the definition of small business to include firms that are owned and controlled by some of the nation’s wealthiest venture capitalists. That could divert billions of dollars a year away from the nation’s legitimate small businesses and have a significant negative effect on job creation.”

The American Small Business League (ASBL) has released the first analysis of the government’s fiscal year (FY) 2009 small business contracting data. https://www.asbl.com/documents/ASBL_2009_dataanalysis.pdf

The ASBL conducted a review of the top 100 recipients of federal small business contracts for FY 2009. Within its sample, the ASBL identified 61 large firms, which received 64.5 percent of the total dollars the government claimed to have awarded to small businesses.

The ASBL also identified a series of Fortune 500 corporations and other large firms in the government’s 2009 contracting data. Recipients of small business contracts included: Lockheed Martin, Boeing, Raytheon, L-3 Communications, British Aerospace (BAE), Northrop Grumman, General Electric, Booz Allen Hamilton, Thales Communications, General Dynamics, and Dell Computer.

In addition to large corporations in the government’s 2009 small business contracting numbers, the ASBL also uncovered gross discrepancies in the volume of contracts awarded to some companies. In a sampling of the data, the ASBL uncovered several examples in which the volume of contracts awarded to legitimate small businesses was dramatically inflated. This appears to be an intentional attempt by the government to misrepresent the actual volume of contracts awarded to small businesses. Another technique the ASBL has uncovered is the exclusion of billions of dollars in large prime contracts from the government’s small business calculations, which further inflates the percentage of federal contracts the government claims to have awarded to legitimate small businesses.

The ASBL recommends the Obama Administration take the following steps to increase the volume of federal contracts awarded to small businesses:

• Issue an executive order to stop the government from reporting awards to publicly traded companies as small business awards.
• Abolish the Comprehensive Subcontracting Plan Test Program, which currently allows prime contractors to avoid any reporting or penalties for non-compliance of small business subcontracting goals.
• Implement the 5 percent set-aside goal for women-owned firms for all industries.

“FY 2009 marks the tenth consecutive year that the government has diverted federal small business contracts to corporate giants,” ASBL President Lloyd Chapman said. “The SBA has gone from telling us that the diversion of federal small business contracts was a ‘myth’ to telling us that it’s the result of ‘simple human error.’ It is time for President Obama to honor his campaign promise, when he said, ‘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 Obama Administration has finally released the agenda of its June 28 small business forum. When the small business forum was originally announced on June 14, the administration requested input from small business owners and offered them the opportunity to sign up to address members of President Obama's "Interagency Task Force" on small business.

After angry small business owners from around the country registered to attend the forum and speak, the agenda was abruptly modified to apparently preclude any unscripted comments that could embarrass the Obama Administration with the attending press.

Small business owners were provided an agenda for the event via e-mail on Monday, just a week before the forum is scheduled to begin. According to the new guidelines, comments are to be limited to only three narrowly focused categories.

Small business owners that were preparing to blast the Obama Administration for giving less than 3 percent of the stimulus funds to small businesses, and breaking a series of campaign promises to the small business community, will not have that opportunity under the new agenda.

During the 2008 Presidential Campaign, President Obama promised to restore the Small Business Administration's (SBA) budget and staffing, restore the SBA Administrator to a cabinet level position, and implement the 5 percent set-aside contracting goal for women-owned firms, which was passed by Congress in 2000.

In February of 2008, President Obama also 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, President Obama has failed to honor any of his campaign promises to small business owners. The American Small Business League (ASBL) recently released a study, which found 16 instances where President Obama adopted polices that were harmful to small businesses. (https://www.asbl.com/documents/20100526_ASBL_AnalysisObamaSB.pdf)

The most recent data released by the federal government indicates the Obama Administration has diverted billions of dollars in federal small business contracts to corporate giants in the United States, Europe and Asia. Firms included in the Obama Administration small business data included Lockheed Martin, Boeing, Raytheon, General Dynamics, Ssangyong Corporation headquartered in South Korea, and Italian firm Finmeccanica SpA. (https://www.asbl.com/documents/20090825TopSmallBusinessContractors2008.pdf)  

"If President Obama sincerely wanted to stimulate the economy and help the small businesses that create nearly 100 percent of net new jobs, he would quit diverting federal small business funds to Fortune 500 firms," ASBL President Lloyd Chapman stated.

Please click here to watch a clip regarding the ASBL's concerns: http://www.youtube.com/watch?v=YJh26mQySos

Petaluma, Calif. - On Monday, June 14, the Obama Administration surprised small business owners across the country by announcing a small business forum to be held at the U.S. Department of Commerce on June 28. The agenda has been so narrowly focused that it will be difficult, if not impossible, for meeting attendees to bring up President Obama's broken campaign promises to small businesses such as, "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 American Small Business League (ASBL) believes the Obama Administration has fast tracked the registration process and erected barriers as a means of discouraging attendance by small business interests outside the Washington D.C. area.

The ASBL maintains the short notice and other registration barriers may have a chilling effect on the attendance of small business owners who take issue with the Obama Administration's poor track record for small businesses. (https://www.asbl.com/documents/20100526_ASBL_AnalysisObamaSB.pdf)   

Although the forum was supposedly designed to collect input from small businesses on ways to increase their business with government, no small business registrant has received notification that they will be allowed to speak.  Legitimate small business organizations or individual small business owners who had hoped to be heard, will not know if they will be allowed to speak.  This has made it extremely difficult for small business owners outside the Washington area to attend. To make matters worse, the forum will be extremely short, which has also discouraged individuals around the country from attending. 

The ASBL believes the true purpose of the forum is to gain support in the media for Obama Administration policies that may actually reduce small business contracting opportunities with the federal government.

"I guarantee President Obama will try to use his small business task force and this meeting to push policies that will actually reduce the volume of federal contracts to legitimate small businesses under the guise of helping small businesses," ASBL President Lloyd Chapman said. "A proposal to change the definition of a small business, which would divert small business funds to firms controlled by venture capitalists, is a certainty.  I wouldn't be surprised if he tried to weaken small business programs further by breaking up the SBA. Big defense contractors and wealthy venture capitalists want the $150 billion that is supposed to go to small businesses, and they contributed hundreds of millions of dollars to President Obama and congress to achieve that goal."

-###-