Corporate Giants Land Obama Small Business Funds Under ARRA

By Lloyd Chapman
President, American Small Business League

In December of 2008, President Barack Obama’s Presidential transition team estimated that for every billion dollars spent on federal infrastructure projects, 40,000 jobs would be created nationwide. (http://tiny.cc/POj7a ) Yet on Thursday, the Obama Administration released its first report on the distribution of dollars under the American Recovery and Reinvestment Act (ARRA) claiming that it has distributed $16 billion in stimulus funds and created 30, 383 jobs. (http://bit.ly/1ulfGz)

Based on the Obama Administration’s December 2008 estimates regarding job creation, the ARRA funds spent to date should have created 640,000 jobs. Thursday’s numbers represent a shortfall of 609, 617 jobs.

The American Small Business League (ASBL) maintains that if the Obama Administration had allocated more money for small businesses, the ARRA funds spent would have created significantly more jobs.

The ASBL points to the following:

- According to data from the United States Census Bureau, 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 net new jobs.
(http://www.inc.com/news/articles/200708/data.html)

- Small businesses are responsible for more than 50 percent of the Gross Domestic Product (GDP), 90 percent of innovations and over 50 percent of our nation’s non-farm private sector workforce. (http://www.sba.gov/advo/research/profiles/08us.pdf)

On Oct. 2, the Small Business Administration claimed that small businesses had been awarded nearly 26 percent of all federal stimulus dollars awarded to date, or $4 billion. (http://www.govexec.com/dailyfed/1009/100609rb1.htm)

That said, the ASBL has found significant discrepancies in the government’s data, which are consistent with more than 15 federal investigations indicating that every year billions of dollars in federal contracts intended for small businesses actually go to some of the largest corporations in the world. Since 2003, firms like: Lockheed Martin, Boeing, Raytheon, Northrop Grumman, Dell Computer, British Aerospace (BAE), Rolls-Royce, French giant Thales, Ssangyong Corporation headquartered in South Korea and the Italian Finmeccanica SpA, have received billions of dollars in federal small business contracts.

With that in mind, small businesses have received a mere fraction of the total dollars awarded by the government, while Fortune 500 corporations are reaping the benefits of the stimulus.

If President Obama is serious about creating jobs and stimulating our nation’s economy, he should honor his campaign promise to, “stop the diversion of federal small business contracts to corporate giants,” by issuing an executive order or by supporting H.R. 2568, the Fairness and Transparency in Contracting Act of 2009. (http://bit.ly/4fRrGq, http://www.asbl.com/documents/hr2568.pdf)


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Miami Herald: In Florida, 'small businesses' aren't all small

Small businesses are supposed to get a substantial percent of government contracts. But not all contract holders are really that small.

BY JIM WYSS
jwyss (at) MiamiHerald.com

What do Dell Computer, General Electric and Boeing have in common? These massive corporations were all counted as ``small businesses'' doing work in Florida last year.

The three firms -- along with a dozen other billion-dollar companies -- soaked up at least $76 million in federal contracts that were recorded as going to small businesses during fiscal year 2008, according to government data.

The issue of how federal dollars are spent is critical in Florida, where 90 percent of all businesses have fewer than 20 employees and government contracts represent a valuable lifeline amid a tanking economy.

While the federal government is obliged to put 23 percent of all direct, or prime, contracts in the hands of small firms, it has missed that mark for the past three years.

``Call me crazy, but I just don't think Fortune 500 companies should be counted as small-business contracts,'' said Lloyd Chapman, president of the American Small Business League. ``I just can't believe this is still going on.''

Please click here to read more: http://www.miamiherald.com/569/story/1276867.html

Obama Refusing to Give Contracts to Small Businesses as Unemployment Continues to Rise

FOR IMMEDIATE RELEASE
October 6, 2009

Petaluma, Calif. - According to the most recent data from the Federal Procurement Data System - Next Generation (FPDS-NG), the Obama Administration is continuing to award billions of dollars a month in federal small business contracts to corporate giants.

The top recipient was Fortune 500 firm Textron, which received $775.7 million in federal small business contracts. In addition to Textron, Ssangyong Corporation, which is headquartered in Seoul, South Korea received over $254 million in small business contracts; and Finmeccanica SpA, which is headquartered in Italy with 73,000 employees, received over $283 million.

Other firms included in the Obama Administration's small business data were: Lockheed Martin, Boeing, Raytheon, Northrop Grumman, General Dynamics, AT&T, 3M Corporation, Xerox, Dell Computer, Booz Allen Hamilton, Hewlett-Packard, General Electric, Staples, Office Depot, British Aerospace (BAE), Rolls-Royce and French firm Thales Communications.

In February of 2009, Bechtel Bettis Inc. received a $128 million small business contract from the U.S. Department of Energy (DOE) under the Obama Administration.
(http://www.asbl.com/documents/20090806BechtelSB_DOE.pdf)

Since 2003, more than 15 federal investigations have found that every year billions of dollars in federal small business contracts are diverted to corporate giants. Report 5-15 from the U.S. Small Business Administration (SBA) Office of Inspector General referred to the problem as, "One of the most important challenges facing the SBA and the entire federal government today." (http://www.asbl.com/documents/05-15.pdf)

In February of 2008, President Obama recognized the problem when he stated, "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)

To date, the Obama Administration has not adopted any policies or legislation to honor that campaign promise.

On Friday, October 2, the U.S. Department of Labor (DOL) announced that unemployment hit 9.8 percent in the month of September. Moreover, DOL announced that when factoring in frustrated workers who have dropped out, taken part-time work or haven't looked recently; unemployment could be as high as 17 percent.

The American Small Business League (ASBL) believes unemployment is on the rise as a result of the Obama Administration's refusal to stop the diversion of billions of dollars a month in federal contracts earmarked for small businesses to corporate giants.

"It's hard not to question President Obama's sincerity about creating jobs when he is giving billions of dollars a month in federal small business contracts to corporate giants around the world," ASBL President Lloyd Chapman said. "Until we stop this problem, unemployment is going to continue to rise."

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Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn@asbl.com
(707) 789-9575

Alabama Congressman Parker Griffith Claims Loophole to Give Billions to His Top Campaign Contributors was 'Unintended’

FOR IMMEDIATE RELEASE
October 1, 2009

Petaluma, Calif. – Alabama Congressman Parker Griffith (D-AL-5) is claiming that a bill he wrote would carry the ‘unintended consequence’ of allowing the subsidiaries of some of his largest campaign contributors to receive billions of dollars in federal small business contracts.

During an interview with the Times Daily newspaper regarding H.R. 3558, the Small Business Fair Competition Act, Congressman Griffith claimed that it was not his intention to create loopholes to allow two of his largest campaign contributors, Boeing and Northrop Grumman to land billions of dollars in federal small business contracts.

In the story, American Small Business League (ASBL) President Lloyd Chapman stated, "It is simply not believable that Congressman Griffith accidentally wrote a bill that is going to allow the subsidiaries of some of his largest campaign contributors like Boeing and Northrop Grumman to get small business contracts. It is absurd." (http://www.timesdaily.com/article/20090930/ARTICLES/909305008/1011/NEWS?Title=Griffith-Bill-needs-more-work)

The ASBL was the only organization to uncover the supposed accidental loophole. Yet, as opposed to thanking the organization, Griffith accused the group of seeking notoriety.

Recent data released by the Obama Administration indicates that Fortune 500 defense contractors in Congressman Griffith's district such as Boeing, Northrop Grumman and British Aerospace (BAE) are receiving federal small business contracts. Critics of Griffith and his bill believe that he was clearly trying to create a loophole to allow Fortune 500 corporations to continue to take contracts intended for small businesses.

Since 2003, over a dozen federal investigations have found that every year billions of dollars in federal small business contracts are diverted to Fortune 500 firms with a concentration on the defense and aerospace industry.

In 2005, the Small Business Administration Office of Inspector General referred to the diversion of federal small business contracts to corporate giants as, "One of the most important challenges facing the Small Business Administration and the entire Federal government today." (http://www.asbl.com/documents/05-15.pdf)

Even President Obama weighed in on the issue, when in February of 2008 he released the statement, "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)

"Congressman Griffith's excuse that the language in H.R. 3558, that would allow large businesses to continue to receive federal small business contracts, was an accident is simply not believable," ASBL President Lloyd Chapman said. "It's ludicrous. I think Congressman Griffith is just another crooked politician and a classic example of everything the public hates about Washington. I think the American people are sick and tired of large corporations buying legislation from members of Congress, like Parker Griffith, that damage the middle class."

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Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn@asbl.com
(707) 789-9575

Alabama Congressman Introduces Bill to Give Small Business Funds to His Top Campaign Contributors

FOR IMMEDIATE RELEASE
September 30, 2009

Petaluma, Calif. - On September 14, 2009, Alabama Congressman Parker Griffith (D - AL5) introduced a new bill, H.R. 3558, which will allow some of his largest campaign contributors to land billions of dollars in federal small business contracts. (http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=111_cong_bills&docid=f:h3558ih.txt.pdf)

Boeing and Northrop Grumman are two of Congressman Griffith's largest campaign contributors. If H.R. 3558 becomes law, Boeing, Northrop Grumman and hundreds of Fortune 1000 firms will be able to hold on to billions of dollars in federal contracts earmarked for middle class firms. (http://tiny.cc/mp06p )

Information from the Federal Procurement Data System-Next Generation (FPDS-NG) indicates the Obama Administration counted billions of dollars in contracts to many of the largest firms in the world towards the government's 23 percent small business contracting goal. During fiscal year (FY) 2008, the Obama Administration included over $775 million in awards to Textron in the government's small business data. Textron is a Fortune 500 firm with 43,000 employees and annual revenue of over $14 billion. In addition to Fortune 500 firms in the U.S., billions of dollars in contracts awarded to corporate giants in Italy, England, France, Holland and Korea were included in the Obama Administration's small business statistics.

The American Small Business League (ASBL) estimates that legitimate small businesses are losing over $100 billion a year in federal small business contracts as a result of the abuses. The ASBL has won a series of lawsuits against several federal agencies, which have forced the release of thousands of pages of data indicating that corporate giants in the U.S. and abroad have received hundreds of billions of dollars in federal small business contracts for over 10 years. (http://www.asbl.com/aboutus.html)

The Small Business Administration Office of Inspector (SBA OIG) condemned the diversion of federal small business contracts to corporate giants in Report 5-15, referring to the abuses as, "One of the most important challenges facing the Small Business Administration and the entire Federal government today." (http://www.asbl.com/documents/05-15.pdf)

If Congressman Griffith's bill becomes law, billions of dollars in federal small business contracts could be diverted to Fortune 500 firms, corporate giants around the world, and their subsidiaries indefinitely.

In May of 2009, Congressman Hank Johnson (D - GA) introduced H.R. 2568, the Fairness and Transparency in Contracting Act of 2009, which will have the opposite effect of H.R. 3558. The ASBL played a major role in the drafting of H.R. 2568. The bill will halt the flow of federal small business contracts to large business. The ASBL estimates H.R. 2568 will redirect over $100 billion a year back to legitimate small businesses and deliver the largest economic stimulus for middle class firms to date.
(http://www.asbl.com/documents/hr2568.pdf)

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Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn@asbl.com
(707) 789-9575

Alabama Congressman Parker Griffith Wants Big Businesses to Get Federal Small Business Funds

FOR IMMEDIATE RELEASE
September 24, 2009

Petaluma, Calif. - Huntsville Alabama Congressman Parker Griffith (D - AL5) has introduced a new bill in the House of Representatives that will allow divisions of Fortune 500 firms and thousands of other large businesses to receive billions of dollars in federal contracts earmarked for small businesses.

Several Fortune 500 firms in Congressman Griffith's district such as Boeing, Northrop Grumman and British Aerospace (BAE) are currently receiving millions of dollars in federal small business contracts through loopholes in federal contracting law.

If H.R. 3558 becomes law, Boeing, Northrop Grumman, BAE and their subsidiaries could continue to receive federal small business contracts indefinitely. Boeing and Northrop Grumman are amongst Congressman Griffith's largest campaign contributors. (http://tiny.cc/JWuUg)

Currently, there are 5,126 small businesses registered to do business with the federal government in the State of Alabama, according to the Central Contractor Registration database. If H.R. 3558 is passed and signed into law, more than 99 percent of the small businesses in Alabama would be put at a significant competitive disadvantage.

In 2005, the Small Business Administration Office of Inspector General (SBA IG) referred to the diversion of federal small business contracts to corporate giants as, "One of the most important challenges facing the Small Business Administration and the entire Federal government today." (http://www.asbl.com/documents/05-15.pdf)

Since 2003, over a dozen federal investigations have found that Fortune 500 firms in the United States and some of the largest firms in Korea, Italy, Holland, France and England have received billions of dollars in federal small business contracts.

Another bill that has been introduced in the House of Representatives, "the Fairness and Transparency in Contracting Act of 2009," or H.R. 2568, is designed to close all of the loopholes, and halt the flow of federal small business contracts to large businesses.

H.R. 2568 was introduced by Congressman Hank Johnson (D - GA) and has 15 co-sponsors. Congressman Johnson's bill is backed by small business groups and chambers of commerce across the country.

Research by the American Small Business League (ASBL) estimates that legitimate small businesses are losing over $100 billion a year in federal small business contracts through various loopholes in federal contracting law and policy.

ASBL estimates that if H.R. 2568 becomes law, over $100 billion a year in federal small business contracts will be redirected to middle class firms nationwide. If Congressman Griffith's bill, H.R. 3558, becomes law billions of dollars in federal small business contracts will continue to be diverted to corporate giants.

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Please click here to watch a short clip about the ASBL's concerns regarding H.R. 3558: http://www.youtube.com/watch?v=KbGwwEaEGSM



Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn@asbl.com
(707) 789-9575

Senate Committee Snubs Small Business Champions

FOR IMMEDIATE RELEASE
September 21, 2009

Petaluma, Calif. - On Tuesday, September 22, 2009, the Senate Committee on Small Business and Entrepreneurship will hold a roundtable discussion regarding contracting reform for small businesses, yet no individual with any track record of successfully campaigning for small businesses has been invited to testify.

The American Small Business League (ASBL) is raising concerns regarding the lack of small business voices that will be present at the committee-run roundtable event. The roundtable is tentatively scheduled to include: Joseph Jordan from the U.S. Small Business Administration (SBA), and representatives from the U.S. Department of Transportation, and the Department of Defense, according to a committee staffer.

The ASBL points to the fact that it is the only organization that has written a bill to address long standing abuses in federal small business contracting programs. Since 2002, the ASBL has waged a seven-year battle to end the diversion of federal small business contracts to large corporations. Despite the ASBL's documentable track record of advocacy, the committee has snubbed them repeatedly.

"We don't expect to be invited to these types of meetings because the Senate Committee on Small Business has no interest in contracting reform," ASBL President Lloyd Chapman said. "Since 2003, over a dozen federal investigations have found that billions of dollars in contracts earmarked for small businesses have been diverted to Fortune 500 firms. This issue has been featured on every major television network and in every major newspaper in the country, yet the committee has failed to lift a finger to stop it for seven years. 2009 represents the tenth anniversary of the diversion of federal small business contracts to large corporations."

Information in the Federal Procurement Data System-Next Generation (FPDS - NG) indicates that the Obama Administration included billions of dollars in contracts awarded to Fortune 500 firms and even some of the largest corporations in the world towards its fiscal year (FY) 2008 small business goals. Firms such as: Lockheed Martin, Boeing, Raytheon, Northrop Grumman, Dell Computers, British Aerospace (BAE), Rolls-Royce, French giant Thales, Ssangyong Corporation headquartered in South Korea and the Italian Finmeccanica SpA, received billions of dollars in federal small business contracts during FY 2008.

In the last decade, no member of the Senate Small Business Committee has proposed legislation to stem the flow of federal small business contracts to corporate giants. ASBL points to the fact that in 2009, the Senate Small Business Committee unanimously passed a bill that would allow companies owned by some of the nation's wealthiest investors to receive federal small business contracts.

"Small business owners around the country refer to that committee as the Senate Anti-Small Business Committee," Chapman said.

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