The largest economic stimulus program passed by Congress to boost the middle-class economy and create jobs is the Small Business Act. That law mandates that a minimum of 23% of all federal contracts be awarded to small businesses. Today, that is not the case.  According to the American Small Business League, the leading advocacy organization for small businesses, Fortune 500 companies have received billions in federal dollars which are intended for small businesses. The federal government has subverted the Small Business Act for 40 years.  This steals from our middle class and undermines our Main Street economy.  A GAO (Government Accountability Office) study found that 34% of large, profitable corporations paid zero in federal income taxes.  These parasitic, mega-corporations fill their coffers while shipping American jobs overseas and haven’t created any new net jobs since the 1980s.

As President, Robert F. Kennedy Jr. will insist on transparency and guarantee that America’s small businesses receive all federal contracts that the law mandates.  Fortune 500 firms should not receive government contracts meant for legitimate small businesses, especially after the economic devastation that the Trump and Biden-Harris lockdowns incurred on our middle class.  Legitimate small businesses, companies with 100 employees or less, are currently receiving no more than 3% of the total value of all federal contracts and not the 23% currently mandated by the 1953 Small Business Act. By comparison, the top 1% firms in America are getting over 95% of all federal spending and contracts.

There are 33 million small businesses in America. They are responsible for over 50% of the private sector workforce, over 50% of the GDP, most U.S. exports and over 95% of all net new jobs in America.  These are the firms where most Americans work.  Small business is essential to growing the middle class.  A big middle class is key to a healthy, growing economy for the American people which, in turn, safeguards our democracy.

Further, women comprise 51% of the population and own 42% of all businesses in America, but they have never received more than 5% of all federal contracts and spending. Under the previous and current administration, firms owned by men received over 95% of all federal spending.  Under a Kennedy Administration, a meritocratic process will address the blatant underrepresentation of federal contracts and spending awarded to women and minority owned small businesses, as well as small business owners in struggling communities. Kennedy will also instruct the President’s Economic Council to develop strategies for how to shift an additional 10% to 20% of government contracts from mega-corporations to small businesses over the course of his first term.

The Senate Small Business report found that every 1% increase in federal contracts to small businesses creates 100,000 net new jobs.  As President, Kennedy will give small businesses the full 23% which will create an additional 2 million new jobs annually.  Working towards shifting an additional 10% to 20% of government contracts away from mega-corporations to small businesses would account for an additional one to two million new jobs per year.  At this rate, over the next decade, investing in small businesses will result in well more than 25 million new jobs, dramatically expanding our middle class and our tax base.  A big middle class will help our economy tackle the runaway debt of the Trump and Biden years, bringing inflation under control.  This requires no new taxes and no new spending.  It’s simply honoring legal requirements, shifting priorities from large corporations to the American people and ending the government corruption that has subverted the intention of the Small Business Act.

PROTECTING SMALL BUSINESS OWNERS FROM PREDATORY LENDERS

Predatory lending is a systemic problem affecting American small business owners. Alternative and “non bank” lenders use aggressive tactics to target small businesses for loans with hidden fees and exorbitant interest rates.

Surveys show that annual percentage rates (APR) for unfair and unsustainable small business loans can range from 40-100%, reaching as high as 350%. Many small business lenders do not fully disclose APRs and fees in their marketing materials. This kind of predatory lending disproportionately affects Black and Latino business owners, who are more likely to assume high-cost and less-transparent loans

The Kennedy-Shanahan administration will pursue legislation to extend transparency and truth-in-lending rules to small business financing. Their administration will expand the protections of the Truth In Lending Act, which requires disclosure of loan terms, fees, and APRs for individual consumer loans to small business loans. Transparency and truth-in-lending will save one million small business owners approximately $5 billion per year.

PROTECTING SMALL BUSINESS OWNERS FROM PRIVATE EQUITY

The $8 trillion private equity industry has been aggressively acquiring hundreds of franchise brands in recent years. For small business owners, private equity acquisition of a franchise can cause an existential crisis.  Tiffany Cianci, the former owner of The Little Gym in Frederick, Maryland, shared with Bobby Kennedy Jr. her horror story after her thriving franchise was acquired by a private equity firm.

SEE VIDEO HERE - https://youtu.be/xjl0JVaWaFQ?si=dTDuQEKc90FtmDsc

“When they bought our company, they told us we had to pay them more money and buy new services that our contracts didn’t allow for, and if we didn’t, we would lose everything,” Tiffany Cianci said.

Unfortunately, Tiffany Cianci is not alone. Private equity firms are ransacking franchises nationwide, ruining small businesses and destroying our communities as Wall Street vacuums up the wealth from Main Street.

As President, Kennedy will redirect the National Economic Council to create strategies to protect small businesses, consumers, and our communities from Wall Street’s predatory behavior.  He will forgive COVID loans and cut the red tape that makes becoming a federal contractor prohibitive.  He will pursue reforms to break the corrupt merger between corporate and state power, fix the crony capitalist economy that has increased the wealth gap and dismantled the middle class.  Invigorating small business through a variety of initiatives, Kennedy will restore America’s big middle class.

All told, a Kennedy administration will:

• Put the country on a path to creating more than 25 million new small business jobs over the next decade by:
  • complying with the 1953 Small Business Act and giving small businesses 23% of governmental contracts.
  • giving woman and minority owned small businesses a more fair and equitable share of government spending through a meritocratic process

• Restore the Small Business Act budget and staff that were slashed so that small businesses can receive the legal requirement of 23% of governmental grants.
• Protect small businesses from predatory lenders.
• Protect small business owners from private equity.
• Redirect the National Economic Council to protect small business and free our economy from the corrupt merger between state and corporate power.