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Monday, August 3, 2009

New Bill in Congress Could Boost the Economy and Root Out Liars, Con-Men, Shams and Crooked Politicians

By Lloyd Chapman
President, American Small Business League

Let's look at the facts people. America is in the midst of its worst economic disaster in 80 years. The government is spending $2.7 trillion to stimulate the economy and national unemployment is still headed to 10 percent and beyond. A parade of politicians proclaimed that the stimulus package was needed in order to increase access to capital for small businesses. Yet today, mainstream media outlets like BusinessWeek, and have reported access to capital for small businesses has actually decreased. (,

The latest U.S. Census Bureau statistics indicate that 98 percent of all U.S. firms have less than 100 employees. These firms employ more than 50.2 percent of the private sector work force, create over 97 percent of all net new jobs, and produce over 50 percent of the Gross Domestic Product (GDP). On the other hand, large businesses in America have not created one net new job since 1977.

With a level of wisdom that could only come from America's best and brightest minds, our elected officials in Washington D.C. decided to give over 99 percent of all the stimulus funds to the firms that haven't created one net new job in 32 years. And they gave the small businesses that create virtually all net new jobs less than 1 percent. That should get this economy back on its feet in no time, right? Wrong.

I have a crazy, wacky, wild idea that just might work.

Why don't we give more than 1 percent of the economic stimulus funds to the 27 million small businesses where most Americans work? I'm sure some of you are already thinking this guy must be out of his mind. Is he on drugs? What has he been smoking? Was he dropped on his head repeatedly as a child?

I know I'm really going out on a limb on this one too, but here it is, why don't we quit giving $100 billion a year in federal small business contracts to Fortune 500 firms and some of the biggest companies in Europe? I know, I know, it's out there. I admit it, but when the economy is in this kind of trouble, you gotta get wild and crazy, you gotta think outside the box people.

I have worked very closely with congress on drafting legislation that has been introduced into the House of Representatives that will completely halt the flow of federal small business contracts to companies like British Aerospace (BAE), Rolls-Royce, Xerox, L-3 Communications, Titan industries, Raytheon and Halliburton. It has been titled, H.R. 2568, the "Fairness and Transparency in Contracting Act of 2009."

The Small Business Act requires that a small business be "independently owned," which means that if your firm is publicly traded on the New York Stock Exchange, you don't qualify as a small business. That makes sense doesn't it? I think it does.

The Fairness and Transparency in Contracting Act simply states that the federal government and prime contractors cannot report contracts to publicly traded firms as small business awards. TA-DAAAA, instant economic stimulus. H.R. 2568 will redirect up to $100 billion a year in existing federal infrastructure spending to the small businesses that create over 97 percent of all net new jobs, and create over 50 percent of the GDP. H.R. 2568 will create millions of jobs at virtually no additional expense to taxpayers. Sounds like a win-win to me.

In Report 5-15, the Small Business Administration Office of Inspector General (SBA OIG) referred to the diversion of federal small business contracts to large businesses as, "One of the most important challenges facing the Small Business Administration and the entire Federal government today." Bingo, H.R. 2568 will solve that problem too. Another win-win. Either I'm stuttering or we're up to four wins here. (

So who in the world would be against a bill that will direct more money into the middle class than any economic stimulus plan to date? H.R. 2568, will finally end billions of dollars in fraud and abuse in federal small business contracting programs, which since 2003, have been exposed in more than 15 federal investigations and 500 stories in the mainstream media. Any legitimate group claiming to represent small businesses, women or minorities, and isn't actually funded by Fortune 500 firms to lobby for big business, while masquerading as a small business advocacy group, would have to love this bill, wouldn't they?

Obviously, any politician or organization that would oppose such a magnificently logical, efficient and effective bill would have to be a liar, con-man, sham or crook, right? You bet they would.


Please visit YouTube at to see Lloyd talk about this blog post.

American Small Business League
(707) 789-9575

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