FOR IMMEDIATE RELEASE
February 11, 2009
Petaluma, Calif. – In February of 2008, President Obama released the following statement, "Small businesses are the backbone of our nation's economy and we must protect this great resource. 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)
President Obama's statement was made in response to a series of over 15 federal investigations, which found the Bush Administration had diverted billions of dollars in federal small business contracts to Fortune 500 firms and thousands of other large businesses.
Investigative stories released by ABC, CBS and CNN (ABC, http://www.asbl.com/abc_evening_news.wmv; CBS, http://www.asbl.com/cbs.wmv; CNN, http://www.asbl.com/showmedia.php?id=1170) confirmed that many of the nation's top defense contractors were the actual recipients of most federal small business contracts. Firms such as Lockheed Martin, Boeing, General Dynamics, Raytheon, L-3 Communications, Northrop Grumman and Titan Industries received billions of dollars in U.S. government contracts reported as going to small businesses.
The Small Business Administration (SBA) Office of Inspector General (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." (http://www.sba.gov/IG/05-15.pdf)
A 2007 report from the SBA Office of Advocacy based on U.S. Census Bureau statistics found businesses with fewer than 20 employees were responsible for more than 97 percent of new jobs in America. CNNMoney.com and Inc.com released stories on the findings. (http://www.inc.com/news/articles/200708/data.html ; http://money.cnn.com/2008/07/30/smallbusiness/job_creation.fsb/index.htm)
The American Small Business League (ASBL) is hoping to encourage President Obama and Congress to support draft legislation titled, the Fairness and Transparency in Contracting Act, which will keep President Obama's campaign promise to the small business community and create millions of new jobs.
The new legislation was drafted by the ASBL and is based on original provisions of the Small Business Act, which define a small business as "independently owned." The legislation would exclude publicly traded firms from being counted towards the federal government's small business procurement goal. The essence of the ASBL legislation states, "The federal government and prime contractors can no longer report awards to publicly traded firms as small business awards."
"Everybody in America knows Fortune 500 firms should not be allowed to hijack government small business contracts. Seven years, 15 federal investigations, hundreds of stories in the press and thousands of hard working small businesses forced into bankruptcy are enough," ASBL President Lloyd Chapman said. "It is time for President Obama to do what he said he would do during the campaign and stop the diversion of hundreds of billions of dollars in federal small business contracts to corporate giants."