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Wednesday, January 28, 2009

No Plans From Obama to Dismantle Bush Anti-Small Business Policies

January 28, 2009

Petaluma, Calif. – President Obama has not offered any plans to stop Bush Administration policies that will allow Fortune 500 firms and some of the largest companies in Europe to continue to receive hundreds of billions of dollars in federal small business contracts through the year 2012.

In June of 2007, former Administrator of the Small Business Administration (SBA) Steven Preston ignored recommendations from the SBA's own Office of Inspector General (OIG) and adopted a policy that will allow Fortune 500 firms and thousands of other large businesses to continue to receive federal small business contracts until 2012. (

During the Bush Administration, 15 federal investigations and two private studies were released, which uncovered widespread fraud and abuse in virtually every federal small business contracting program. (

In March of 2005, the SBA OIG released Report 5-15 which stated, "One of the most important challenges facing the Small Business Administration and the entire Federal government today is that large businesses are receiving small business procurement awards and agencies are receiving credit for these awards." (

In Report 5-16, the SBA OIG found large businesses had committed felony federal contracting fraud by making "false certifications" and "improper certifications." (

In Report 5-14, the SBA OIG found the SBA itself had reported contracts to Dutch conglomerate Buhrmann NV, with 26,000 employees worldwide as small business awards. (

A report from the SBA Office of Advocacy found large businesses had illegally received federal small business contracts through, "vendor deception." ( 2002.pdf)

In July of 2008, the Department of the Interior (DOI) OIG found that the agency had awarded millions of dollars in federal small business contracts to firms such as Dell Computer, Sherwin-Williams, John Deere, Xerox, Home Depot, GTSI Incorporated, McGraw-Hill Companies, Ricoh, Starwood Hotels, Weyerhaeuser, Waste Management and World Wide Technology. (

ABC, CBS and CNN all released investigative reports on the issue. (ABC, ; CBS, ;CNN,

The American Small Business League (ASBL) estimates that every year up to $100 billion in federal small business contracts are diverted to Fortune 500 firms and other large businesses.

In February of 2008, President Obama released the statement, "Its time to end the diversion of federal small business contracts to corporate giants." ( Small business advocates and millions of legitimate small businesses are hoping President Obama will make good on his campaign promise, but no specific plans to address the billions in fraud and abuse in federal small business contracting programs have been proposed by President Obama so far.


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