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Thursday, April 2, 2009

New SBA Administrator Supports Plan to Divert Small Business Contracts to Wealthy Venture Capitalists

April 2, 2009

Petaluma, Calif. - On Wednesday, the U.S. Senate Committee on Small Business and Entrepreneurship voted unanimously to confirm President Barack Obama's nominee to head the Small Business Administration (SBA), multi-millionaire venture capitalist, Karen Gordon Mills. As predicted, during the hearing Mills voiced her support for legislation that will divert government small business contracts to some of the nation's wealthiest investors. The full senate is expected to vote on Mills' confirmation by the end of the week.

During the hearing, Mills was asked a question regarding participation in the government's Small Business Innovation Research Program (SBIR) by firms that are owned and controlled by some of the nation's wealthiest investors. Mills acknowledged that she will support legislation that will divert small business contracts to venture capitalists.

In addition to the appointment of venture capitalist Mills to head the SBA, President Obama has already announced that he intends to adopt a policy that will exempt the sale of stock in small businesses from capital gains tax. This appears to be the one-two punch, into which venture capitalists have poured millions of dollars in campaign contributions, and years of lobbying.

The American Small Business League (ASBL) predicts that within a matter of months, the Obama Administration will move forward with its plans to adopt policies that will divert government small business contracts to venture capital controlled companies, while at the same time giving venture capital companies an exemption from capital gains tax when they divest themselves of their interests in those firms.

The ASBL has vowed to oppose the Obama Administration's efforts to divert small business contracts to some of its top campaign contributors from the venture capital industry.

"To me, it is unconscionable for President Obama to campaign for 'change we can believe in,' and then turn around and nominate an SBA Administrator who will support legislation designed to allow multi-millionaire investors to hijack federal programs designed to assist small businesses," ASBL President Lloyd Chapman said. "It is not reasonable to open yet another federal small business program to widespread abuse as our country moves closer and closer to what could be the worst economic catastrophe in American history. President Obama is clearly allowing venture capitalists to buy access to federal small business programs by contributing to his campaign."


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