Bailout Bill Needs New Provisions to Redirect Billions To Middle Class Firms
Petaluma, Calif. - In March of 2005, the Small Business Administration (SBA) Office of Inspector General issued Report 5-15, which 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."
Since the purpose of the "bailout bill" is to bolster our nation's economy, wouldn't it make sense to include a simple and easy provision that would solve a major and longstanding problem within the federal contracting system and redirect up to $100 billion a year in federal small business contracts back into the hands of legitimate and hardworking middle class firms?
The Small Business Act defines a small business as a firm that is "independently owned." Legally, the term independently owned is defined as a firm that is not publicly owned or traded. The addition of a single sentence to the bailout bill could redirect billions of dollars in federal small business contracts back to the very middle class firms the bill is supposed to ultimately rescue. This single sentence would also finally bring an end to years of abuses in federal small business contracting programs.
The sentence should read, "As of January 1st, 2009, the federal government will no longer report awards to publicly traded firms as small business awards."
The addition of this sentence would be a simple and easy solution to the diversion of hundreds of billions of dollars in federal small business contracts to large corporations, and it would provide small businesses and the middle class economy with a much-needed boost.
Since 2003, 15 federal investigations have all found that billions of dollars in federal small business contracts have actually gone to hundreds of the largest corporations in the United States and Europe. In fact, some of the firms federal investigators identified as recipients of federal small business contracts were: Rolls-Royce, Lockheed Martin, Boeing, Raytheon, General Dynamics, Northrop Grumman, Xerox, Dell, John Deere, Microsoft, Titan Industries, British Aerospace Engineering (BAE) and Dutch conglomerate Buhrmann NV.
It is time for this problem to be solved and through the bailout bill a solution could be easily achieved. If government investigators are right, up to $100 billion a year is being pulled out of the middle class economy. It's time for Senator Barack Obama (D - IL), Senator John McCain (R - AZ) and members of Congress to give America's 27 million small businesses more than just lip service.
If Congress really wants to stabilize and bolster our nation's failing economy, let's put $100 billion a year in federal small business contracts back in the hands of the middle class firms where most American's work.
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Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn@asbl.com
(707) 789-9575
Thursday, October 2, 2008
Wednesday, October 1, 2008
Lloyd Chapman: Bailout Bill Doesn't Need to Waive Federal Acquisition Law
Bailout Bill Could Create Billions in Abuses by Waving Federal Contracting Laws
Petaluma, Calif. - The following is a statement by American Small Business League President Lloyd Chapman:
In its present form, the bailout bill will give Bush Administration officials broad power to waive any provision of the Federal Acquisition Regulation (FAR) they choose for an indefinite period of time.
Section 107 of the bill could be a recipe for disaster at a time when the national economy has plummeted as the direct result of a blatant lack of proper government oversight. It would be foolhardy and irresponsible for Congress to grant the very individuals that are directly responsible for one of the worst economic disasters in United States history even more power to ignore federal procurement law for as long as they deem necessary.
The multitude of problems that could arise by allowing government officials to ignore even the most foundational principals of the FAR could be catastrophic. Staggering abuses in federal contracting are a common occurrence. Many of the nation's largest defense contractors are regularly found to be defrauding the federal government out of hundreds of millions and even billions in taxpayer dollars.
Treasury Secretary Henry Paulson was the Chairman and Chief Executive Officer of Goldman Sachs before he came to Washington and he will no doubt be back on Wall Street in an equally if not more powerful position in 90 days. Of all the Bush Administration officials that deserve their fair share of responsibility for our nation's financial disaster, Treasury Secretary Paulson's name should be close to the top of the list.
Treasury Secretary Paulson should not be trusted to waive provisions of the FAR, which could be beneficial to his past and future employers on Wall Street and detrimental to the primary goal of the bailout bill, which is to bolster the national economy. More fraud, abuse and loopholes for Wall Street and government officials will not make our nation's financial institutions more sound, create more jobs or help middle class Americans pay their bills.
-###-
Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn@asbl.com
(707) 789-9575
Petaluma, Calif. - The following is a statement by American Small Business League President Lloyd Chapman:
In its present form, the bailout bill will give Bush Administration officials broad power to waive any provision of the Federal Acquisition Regulation (FAR) they choose for an indefinite period of time.
Section 107 of the bill could be a recipe for disaster at a time when the national economy has plummeted as the direct result of a blatant lack of proper government oversight. It would be foolhardy and irresponsible for Congress to grant the very individuals that are directly responsible for one of the worst economic disasters in United States history even more power to ignore federal procurement law for as long as they deem necessary.
The multitude of problems that could arise by allowing government officials to ignore even the most foundational principals of the FAR could be catastrophic. Staggering abuses in federal contracting are a common occurrence. Many of the nation's largest defense contractors are regularly found to be defrauding the federal government out of hundreds of millions and even billions in taxpayer dollars.
Waiving provisions of the FAR could result in billions of dollars in fraud and abuse at multiple levels of government. Government officials cannot be trusted with the power to waive any federal procurement law they deem unnecessary.
Treasury Secretary Henry Paulson was the Chairman and Chief Executive Officer of Goldman Sachs before he came to Washington and he will no doubt be back on Wall Street in an equally if not more powerful position in 90 days. Of all the Bush Administration officials that deserve their fair share of responsibility for our nation's financial disaster, Treasury Secretary Paulson's name should be close to the top of the list.
Treasury Secretary Paulson should not be trusted to waive provisions of the FAR, which could be beneficial to his past and future employers on Wall Street and detrimental to the primary goal of the bailout bill, which is to bolster the national economy. More fraud, abuse and loopholes for Wall Street and government officials will not make our nation's financial institutions more sound, create more jobs or help middle class Americans pay their bills.
-###-
Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn@asbl.com
(707) 789-9575
Bailout Plan May Include Anti-Small Business Language
The following was release was distributed by the American Small Business League On October 1, 2008.
The Bush “bailout bill” includes some suspicious language that has small business advocates concerned. The Bush Administration has been persistent in its efforts to dismantle federal small business contracting programs and to divert those funds to big businesses. During his tenure, President Bush has cut the Small Business Administration’s (SBA) budget in half, and cut funding and oversight for every program assisting small businesses, including woman, minority and veteran-owned firms. (http://www.asbl.com/showmedia.php?id=1033)
The American Small Business League (ASBL) contends that language within the bailout bill seems out of place, extremely vague and overly broad. As a result, the legislation would give the Secretary of the Treasury a blank check to waive any section of the Federal Acquisition Regulations (FAR) he deems appropriate.
Section 107 of H.R. 3997, which addresses contracting procedures states, “For the purposes of this Act, the Secretary may waive specific provisions of the Federal Acquisition Regulation upon a determination that urgent and compelling circumstances make compliance with such provisions contrary to the public interest.” The House of Representatives defeated H.R. 3997 Monday with a 228-205 vote. However, the ASBL is concerned that as Congress moves to address the current financial crisis, a second incarnation of H.R. 3997 may be adopted with similar language.
During the last thirty days alone, Bush officials at the SBA have suspended taking applications for the Small Disadvantaged Business (SDB) contracting program, refused to release the government’s small business contracting statistics for fiscal year 2007, which ended a full year ago and appealed a Federal District Court ruling requiring them to release the names of firms that received federal small business contracts during FY 2005 and 2006. (http://www.asbl.com/documents/20080925courtordermod.pdf)
If the Bush bailout bill were to become law with the language of Section 107 in place, Bush officials would have the legal power to ignore the sections of the FAR that stipulate federal contracting opportunities for small businesses, woman-owned firms, minority-owned firms and veteran-owned firms. Federal agencies and prime contractors could be allowed to completely ignore the federal government’s small business contracting goals. Section 107 does not contain any stipulation on how long the “wavier of specific provisions” could last. The federal government’s ability to exclude small businesses could last years, and middle-class firms could continue to lose billions of dollars in government contracts and subcontracts.
The ASBL predicted the Bush Administration would try to intensify its efforts to dismantle and weaken federal small business contracting programs as the administration entered its final months. (http://www.asbl.com/showmedia.php?id=1068)
To date, 15 federal investigations have all found that during the Bush Administration, hundreds of billions of dollars in federal small business contracts have been diverted to some of the largest corporations in the World. (http://www.asbl.com/documentlibrary.html) In addition, CBS, ABC and CNN have all done investigative stories on the issue. (http://www.asbl.com/media2.php)
“Not only does this bill not contain any provisions that specifically help small business, it has provisions that could actually harm middle class firms. The language in Section 107 of the bill is totally inconsistent with the stated objectives of this legislation,” ASBL President Lloyd Chapman said. “It is clearly not necessary to suspend federal acquisition law to bail out Wall Street and the financial industry. I am very concerned the Bush Administration included that language to give them the authority to further dismantle federal programs designed to assist small businesses. We got into this situation because of a lack of proper regulation and now the same people that are responsible for these staggering economic problems want to be able to ignore any sections of federal contracting law they deem necessary. George Bush has proven time-after-time that he cannot be trusted especially when it comes to small business issues.”
-###-
Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn@asbl.com
(707) 789-9575
The Bush “bailout bill” includes some suspicious language that has small business advocates concerned. The Bush Administration has been persistent in its efforts to dismantle federal small business contracting programs and to divert those funds to big businesses. During his tenure, President Bush has cut the Small Business Administration’s (SBA) budget in half, and cut funding and oversight for every program assisting small businesses, including woman, minority and veteran-owned firms. (http://www.asbl.com/showmedia.php?id=1033)
The American Small Business League (ASBL) contends that language within the bailout bill seems out of place, extremely vague and overly broad. As a result, the legislation would give the Secretary of the Treasury a blank check to waive any section of the Federal Acquisition Regulations (FAR) he deems appropriate.
Section 107 of H.R. 3997, which addresses contracting procedures states, “For the purposes of this Act, the Secretary may waive specific provisions of the Federal Acquisition Regulation upon a determination that urgent and compelling circumstances make compliance with such provisions contrary to the public interest.” The House of Representatives defeated H.R. 3997 Monday with a 228-205 vote. However, the ASBL is concerned that as Congress moves to address the current financial crisis, a second incarnation of H.R. 3997 may be adopted with similar language.
During the last thirty days alone, Bush officials at the SBA have suspended taking applications for the Small Disadvantaged Business (SDB) contracting program, refused to release the government’s small business contracting statistics for fiscal year 2007, which ended a full year ago and appealed a Federal District Court ruling requiring them to release the names of firms that received federal small business contracts during FY 2005 and 2006. (http://www.asbl.com/documents/20080925courtordermod.pdf)
If the Bush bailout bill were to become law with the language of Section 107 in place, Bush officials would have the legal power to ignore the sections of the FAR that stipulate federal contracting opportunities for small businesses, woman-owned firms, minority-owned firms and veteran-owned firms. Federal agencies and prime contractors could be allowed to completely ignore the federal government’s small business contracting goals. Section 107 does not contain any stipulation on how long the “wavier of specific provisions” could last. The federal government’s ability to exclude small businesses could last years, and middle-class firms could continue to lose billions of dollars in government contracts and subcontracts.
The ASBL predicted the Bush Administration would try to intensify its efforts to dismantle and weaken federal small business contracting programs as the administration entered its final months. (http://www.asbl.com/showmedia.php?id=1068)
To date, 15 federal investigations have all found that during the Bush Administration, hundreds of billions of dollars in federal small business contracts have been diverted to some of the largest corporations in the World. (http://www.asbl.com/documentlibrary.html) In addition, CBS, ABC and CNN have all done investigative stories on the issue. (http://www.asbl.com/media2.php)
“Not only does this bill not contain any provisions that specifically help small business, it has provisions that could actually harm middle class firms. The language in Section 107 of the bill is totally inconsistent with the stated objectives of this legislation,” ASBL President Lloyd Chapman said. “It is clearly not necessary to suspend federal acquisition law to bail out Wall Street and the financial industry. I am very concerned the Bush Administration included that language to give them the authority to further dismantle federal programs designed to assist small businesses. We got into this situation because of a lack of proper regulation and now the same people that are responsible for these staggering economic problems want to be able to ignore any sections of federal contracting law they deem necessary. George Bush has proven time-after-time that he cannot be trusted especially when it comes to small business issues.”
-###-
Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn@asbl.com
(707) 789-9575
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