Petaluma, Calif. – Approximately 168 million Americans work in nearly 27 million small businesses across the United States. There are several key issues effecting small businesses in middle class America that are conspicuously absent from the portion of the 2008 Democratic National Platform which specifically addresses small businesses. Most of the statements in the Platform, which reference small businesses, are vague, such as “We will help small businesses facing high energy costs.”

The Democratic National Platform makes no mention of any specific plans to address three small business issues that could infuse billions of dollars into the middle class economy, which has been the hardest hit by the recent dramatic downturn in the U.S. economy.     

The following are just a few examples of critically important small business issues that are not mentioned in the Democratic National Platform:  the restoration of the Small Business Administration's (SBA) budget and staffing; ending the diversion of billions of dollars in federal small business contracts to Fortune 500 firms; and the implementation of the federal law establishing a 5 percent set-aside contracting goal for woman-owned firms.

The SBA is the only agency in Washington specifically charged with assisting small businesses. Since taking office in 2001, the Bush Administration has cut the SBA’s budget and staffing more than any other federal agency. When President Bush leaves office, the SBA will be approximately half the size it was when he arrived in Washington. Several senior SBA officials have privately acknowledged the SBA has been cut to the point that “the agency can no longer carry out its mission.” The SBA is so understaffed that after hurricane Katrina the agency was forced to hire more than two thousand temporary employees to handle the workload.

During the last thirty days alone, four separate federal investigations have been released, which have found rampant abuses in several SBA programs. In each case, a lack of proper oversight by SBA officials was a major contributing factor to the problems.  

Under the Bush Administration, dozens of other federal programs designed to assist woman-owned firms, minority-owned firms, veteran-owned firms and other small business have been crippled or even eliminated by budget and staffing cuts at the SBA.

Considering the current severe economic downturn in America, any political platform that purports to support small businesses should include specific plans to not only restore, but significantly expand the SBA’s budget, staffing and programs.  

Since 2003, 15 separate federal investigations have found widespread fraud, abuse and mismanagement in federal small business contracting programs. A multitude of problems have allowed hundreds of billions of dollars in federal small business contracts to be diverted to Fortune 500 firms and hundreds of other large businesses around the world.  Some of the largest recipients of federal small business contracts have been British Aerospace and Engineering (BAE), Boeing, Lockheed Martin, Northrop Grumman, Raytheon, Titan Industries and Dutch conglomerate Buhrmann NV.

In Report 5-15, the SBA Office of Inspector General stated, “One of the most important challenges facing the Small Business Administration (SBA) and the entire Federal Government today is that large businesses are receiving small business procurement awards and agencies are receiving credit for these awards.”

Any genuine plan to address the sagging economy by bolstering opportunities for the middle class would have to specifically address the wholesale diversion of federal small business contracts to Fortune 500 firms.

More than seven years ago, President Clinton signed legislation, which established a 5 percent set-aside contracting goal for woman-owned firms. The Bush Administration has persistently refused to implement the program. As a result, woman-owned firms have lost billions of dollars in federal contracting opportunities. The Democratic platform makes no mention of their intention to fully implement this program. 

If the Democratic party wants to convince middle class voters that they have the solutions to the challenges facing small business, they must adopt clear and specific solutions for restoring the SBA’s budget and staffing, halt the flow of federal small business contracts to Fortune 500 firms and fully implement the federal law establishing the 5 percent set-aside contracting goal for woman-owned small businesses.

-###-