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Friday, February 6, 2009

Stimulus Bill Ignores Census Bureau Statistics

February 6, 2009

Petaluma, Calif. – According to a report from the Small Business Administration (SBA) Office of Advocacy, businesses with fewer than 20 employees account for 90 percent of all U.S. firms and are responsible for more than 97 percent of all new jobs. The SBA compiled the report from the latest United States Census Bureau data. (

Detailed analyses of the report were released by and (

Although the nation's top economists agree that creating jobs is essential to a successful stimulus plan, neither the House, nor Senate versions of the stimulus bill contain any provisions specifically directed to the small businesses that create most new jobs.

Economic experts like Dr. Laura Tyson and Carly Fiorina have both acknowledged that directing federal infrastructure funds to small businesses would be the most effective way to stimulate our nation's failing economy. Tyson is the former Chair of the U.S. President's Council of Economic Advisers during the Clinton Administration and is currently an economic adviser to President Barack Obama. Fiorina is the former CEO of Hewlett-Packard and McCain campaign economic advisor.

During the Bush Administration, federal programs developed to direct federal spending to small businesses were partially dismantled and plagued by widespread fraud and abuse. Since 2003, more than 15 federal investigations have found billions of dollars in federal contracts earmarked for small businesses were actually diverted to Fortune 500 firms, their subsidiaries and other clearly large businesses.

The American Small Business League (ASBL) has launched a national campaign to encourage President Obama and Congress to include a provision in the economic stimulus bill that would bolster federal contracting programs for small business, and eliminate existing abuses in federal small business programs that have diverted billions of dollars in federal small business contracts to Fortune 500 firms.

As early as February 2008, President Obama agreed with the ASBL by stating, "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." (

The ASBL estimates that if Congress added a provision to the stimulus bill that would stop the flow of federal small business contracts to large businesses, as much as $100 billion a year in existing federal infrastructure spending would be diverted back to America's small businesses.

On December 6, President Obama's transition team estimated that every billion dollars spent on federal infrastructure projects would create 40,000 jobs. Based on President Obama's estimation, the ASBL projects that a simple pro-small business provision in the stimulus bill to stop the flow of small business contracts to large corporations would create up to 4 million new jobs. (


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