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Wednesday, August 19, 2009

Obama Administration Rhetoric Inconsistent with Small Business Policies

August 19, 2009

Petaluma, Calif. – On Tuesday, the Obama Administration released a press release outlining increased efforts to include small businesses in the economic recovery, and federal contracting programs. Despite mentioning the significant impact of small businesses on our nation's economy, any mention of President Obama's February 2008 campaign promise to end the diversion of federal small business contracts to corporate giants was conspicuously absent from the release.(

In February of 2008 President Obama stated, "It is time to end the diversion of federal small business contracts to corporate giants." (

Since 2003, over 15 federal investigations have found that a lion's share of government small business contracts actually go to Fortune 500 firms and thousands of large businesses around the world.

In 2005, the Small Business Administration Office of Inspector General (SBA OIG) referred to the diversion of federal small business contracts to large corporations as, "One of the most important challenges facing the Small Business Administration and the entire Federal government today." (

The American Small Business League (ASBL) estimates that during the first six months of the Obama Administration, over $50 billion in federal small business contracts were awarded to clearly large businesses. Critics of the Obama Administration's small business policies point to the fact that not only has President Obama not made good on his campaign promise to end the diversion of federal small business contracts to corporate giants, but thus far his administration has failed to follow-though on a majority of its promises to the small business community.

To date, the Obama Administration has failed to: restore the SBA's budget, restore the SBA administrator to a cabinet level position, stop the pentagon from dismantling programs for minority owned firms and implement the 5 percent set-aside program for women-owned firms. Finally, the administration appears to be backing new legislation that will divert even more small business contracts to some of the nation's wealthiest venture capitalists.

Of the funds allocated as part of the American Recovery and Reinvestment Act of 2009, approximately 1 percent has actually gone to America's 27 million small businesses.

"It is reprehensible that President Obama would make these statements about his support for small businesses when he has done nothing to stop the daily diversion of up to $400 million in federal small business contracts to corporate giants around the world," ASBL President Lloyd Chapman said. "The administration's press release appears to be is just another public relations ploy. If President Obama really wants to do something for small businesses, he'll make good on his campaign promise to stop the diversion of federal small business contracts to corporate giants by publicly supporting legislation such as H.R. 2568, the Fairness and Transparency in Contracting Act of 2009."


Christopher Gunn
Communications Director
American Small Business League
(707) 789-9575

1 comment:

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