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Please e-mail the American Small Business League (ASBL) at brianreeder@asbl.com. Thank you.

Monday, September 20, 2010

Jobs Bill Should Include Language to Increase Contracts for Small Businesses

Jobs Bill Should Include Language to End the Diversion of Small Business Contracts to Corporate Giants

Petaluma, Calif. – In February of 2008, Barack Obama promised small businesses that if elected president he would, “end the diversion of federal small business contracts to corporate giants." (http://www.barackobama.com/2008/02/26/the_american_small_business_le.php)

President Obama’s campaign promise was based upon a series of federal investigations, which found that Fortune 500 firms and thousands of large businesses in the U.S. and Europe received billions of dollars in federal small business contracts. The first federal investigation was held in May of 2003. Today, large businesses continue to receive billions of dollars in federal contracts intended for small businesses.

The American Small Business League (ASBL) strongly encourages Congress to add language to H.R. 5297, the Small Business Jobs Act, which would simply halt the diversion of federal small business funds to corporate giants. The ASBL maintains that ending these abuses would be the most effective and efficient means of stimulating the American economy and creating jobs.

According to the U.S. Census Bureau, small businesses are responsible for more than 90 percent of all net new jobs, 50.2 percent of the non-farm private sector workforce, 50 percent of the gross domestic product (GDP) and 90 percent of exports and innovations. (http://www.sba.gov/advo/research/rs359.pdf)

The most recent information released by the Obama Administration indicates that of the top 100 recipients of federal small business contracts, 65 percent of the dollars actually went to large businesses.(http://www.asbl.com/documents/ASBL_2009_dataanalysis.pdf)

The federal government has a goal of awarding 23 percent of all government contracts to small businesses. The ASBL has estimated that the government is currently awarding less than 5 percent of its purchases to small businesses. Ending the diversion of federal small business contracts to corporate giants could increase the volume of government dollars awarded to small businesses by more than 18 percent.

In April of 2010, U.S. Senate Committee on Small Business and Entrepreneurship Chair, Mary L. Landrieu (D-LA), estimated that increasing contracts to small businesses by just 1 percent, would create more than 100,000 new jobs. Based on this estimate, ending this fraud and abuse could create more than 1.8 million new jobs. (www.smallbusinessmajority.org/_docs/resources/SBC_Jobs_Package.pdf)

“If President Obama wants to create jobs, it’s real simple; quit giving small business contracts to Fortune 1000 firms and large businesses. He could do that with one or two sentences in the jobs bill,” ASBL President Lloyd Chapman said.


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

Wednesday, September 15, 2010

Obama Jobs Bill Could be Job Killer for Small Businesses

Obama Jobs Bill Could Slash Contracting Opportunities for Small Businesses

FOR IMMEDIATE RELEASE
September 15, 2010

Petaluma, Calif. – President Barack Obama’s small business jobs bill contains a dangerous loophole that could encourage billions of dollars in fraud in small business contracting programs, and protect fraudulent companies from prosecution. The bill is currently pending in the U.S. Senate.

Section 1341 of H.R. 5297, the Small Business Jobs Act, contains provisions that would allow the Small Business Administration (SBA) to develop policies and procedures that would protect large businesses that have misrepresented themselves as small businesses from prosecution for felony contracting fraud.

Since 2003, over a dozen federal investigations have found billions of dollars a month in federal small business contracts have been diverted to Fortune 500 firms, large businesses throughout the U.S. and some of the largest companies in Europe.

In 2005, the SBA Office of Inspector General (SBA IG) 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.” (http://www.asbl.com/documents/05-15.pdf)

In Report 5-16, the SBA IG found that large businesses had received federal small business contracts fraudulently by making “false certifications” and “improper certifications.” (http://www.asbl.com/documents/05-16.pdf)

Section 1341 of President Obama’s jobs bill would give the SBA a blank check to develop policies that could protect large corporations from prosecution under the law. Section 16(d) of the Small Business Act prescribes a penalty of up to ten years in prison and a fine of not more than $500,000 per occurrence for firms that have misrepresented themselves as small businesses.

For over a decade, the SBA has attempted to cover-up flagrant abuses in the program by claiming they were the result of miscoding and computer glitches. In one case, Pevco, a Baltimore based small business began losing small business contracts to one of the largest companies in Switzerland. Pevco Chairman Fred Valerino Sr. contacted his congressman, and the SBA responded by claiming that Translogic Corporation received 147 small business contracts over a six-year period “accidentally.”

“The harm done to small businesses by Section 1341, would greatly outweigh any minor benefit the other provisions of the bill might provide,” ASBL President Lloyd Chapman said. “This paragraph could legalize billions of dollars in federal contracting fraud and be tantamount to repealing the small business act. We are going to do everything we can to block this section of the bill. It would only encourage fraud and abuse, divert more federal funds away from legitimate small businesses, and cost America jobs.”


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

Wednesday, September 8, 2010

Obama Administration Should Focus Government Spending on Small Businesses

New Obama Economic Policies Will Ignore Simple Solution to Stimulus

President Barack Obama is set to rollout a new economic plan on Wednesday. The American Small Business League (ASBL) predicts that the plan will completely ignore the simplest, most logical and effective means of creating jobs and stimulating the nation’s failing economy; bringing an end to the diversion of federal small business contracts to corporate giants.

Small businesses are the backbone of America’s economy, and a major engine for job creation. According to the U.S. Census Bureau, small businesses are responsible for more than 90 percent of all net new jobs in America, over 50 percent of the gross domestic product (GDP), and over 90 percent of all U.S. exports and innovations.

Congress established small businesses as the economic engine of the nation with the passage of the Small Business Act of 1953. Today federal law requires a minimum of 23 percent of all federal contracts to be awarded to small businesses. With the annual federal acquisition budget for foreign, domestic, classified and unclassified acquisitions hovering around $1 trillion, small businesses should be receiving roughly $230 billion a year in federal contracts.

On August 27, the Obama Administration announced that it missed its 23 percent goal, awarding 21.89 percent to small businesses. The ASBL has estimated that as a result of the diversion of federal small business contracts to corporate giants, the government actually awarded less than 5 percent of its purchases to small businesses.

To further compound the issue, since 2003 over a dozen federal investigations have found most federal small business contracts actually go to Fortune 500 firms and corporate giants around the world.

President Obama realized the magnitude of this problem during his campaign when he released the statement, “It is time to end the diversion of federal small business contracts to corporate giants.” To date President Obama has failed to honor that promise.

“If President Obama really wants to create jobs in the most cost effective and efficient way, he should direct the Small Business Administration to end policies that divert billions of dollars a month in federal small business contracts to corporate giants,” ASBL President Lloyd Chapman said. “This will create more jobs than anything else, and he could do it without congressional approval.”

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

Thursday, September 2, 2010

An Open Letter to House Speaker Nancy Pelosi from American Small Business League President Lloyd Chapman

FOR IMMEDIATE RELEASE
September 2, 2010

Petaluma, Calif. – Despite at least $3 trillion in government spending aimed at stimulating the economy, a multitude of economic indicators now show that the economy is poised to slip into a double dip recession. I believe, as I am sure you do, that we need to bring down unemployment in order to stimulate the economy. To date, none of the actions taken by Congress or the Obama administration have met that need.
(http://money.cnn.com/news/storysupplement/economy/bailouttracker/)

As you may know, small businesses create the overwhelming majority of net new jobs in America. According to the U.S. Census Bureau, businesses with less than 20 employees create over 97 percent of net new jobs. (http://www.inc.com/news/articles/200708/data.html) Statistics from the Small Business Administration (SBA) Office of Advocacy indicate that small businesses create over 90 percent of all net new jobs. (http://www.sba.gov/advo/research/rs359.pdf) Any effort to create jobs must be focused on small businesses.

One of the most effective economic stimulus programs ever passed by the U.S. Congress was the Small Business Act of 1953. The Small Business Act requires that 23 percent of the total value of all government contracts must go to small businesses. This makes perfect sense, considering the important role small businesses play when it comes to the U.S. economy and job creation.

Since 2003, over a dozen federal investigations have found that most small business contracts actually go to Fortune 500 firms, European conglomerates and thousands of other large businesses around the world. Some of those companies are: Lockheed Martin, Boeing, British Aerospace (BAE), Rolls-Royce, Raytheon, Dell Computer, General Electric, Honeywell International Corporation, Ssangyong Corporation headquartered in Seoul, South Korea and Finmeccanica SpA, which is located in Italy and has 73,000 employees. (http://www.asbl.com/documentlibrary.html#5-15)

In March of 2005, the SBA Inspector General referred to this problem 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) The SBA Inspector General has listed this problem as the number one management challenge facing the agency for the past five consecutive years. (http://www.sba.gov/ig/onlinelibrary/tmc/index.html) Even President Obama recognized the magnitude of the problem in February of 2008 when he said, “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)

Ending the diversion of small business contracts to large businesses would redirect over $100 billion a year in federal contracts back into the middle class economy. This would be the most powerful economic stimulus to date and can be used to drive demand directly into the hands of our nation’s small businesses. With this economic stimulus in mind, I urge you to support H.R. 2568, the Fairness and Transparency in Contracting Act. It was introduced by Georgia Congressman Hank Johnson, and currently has 26 cosponsors. This bill is a deficit neutral means of ending the 10-year-old contracting scandal that has facilitated the diversion of over $1 trillion in small business contracts to corporate giants.

The single most effective and deficit neutral way to create jobs is to direct existing federal infrastructure spending to the middle class. So if you want to stimulate the economy and create jobs, H.R. 2568 would be the most effective way to do that. It could be passed and signed into law as soon as Congress comes back in session. I believe that H.R. 2568, which would bring over $100 billion a year, and every year, to small businesses, would be more effective than a one-time shot of $30 billion in loans.

As our nation slides into its worst economic disaster in history; it would be inexcusable to allow the continued diversion of billions of dollars a month in small business contracts to corporate giants. I think that the Democratic Party and President Obama would be wise to take dramatic action to stave off a double dip recession before the November election, and I think that H.R. 2568 would accomplish that.

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

Wednesday, September 1, 2010

An Open Letter to First Lady Michelle Obama from American Small Business League President Lloyd Chapman

FOR IMMEDIATE RELEASE
September 1, 2010

Petaluma, Calif. – I am writing to you today because I am hoping you will help save millions of American small businesses from bankruptcy. I realize that you, as a mother and as someone who came from a hardworking middle class family, could not only sympathize, but also help with the situation we are currently in. I am very concerned, as I am sure you are, about the state of our nation’s economy. And while I know that President Obama is trying to stay positive, all of the economic indicators are alarming, and there is certainly evidence that we could slip into another recession.

Our country is in the worst economic crisis in 80 years, and the situation appears to be degrading. Yet, as I watch what the government has done over the last few years, it does not make much sense to me. I think everyone agrees that small businesses create the overwhelming majority of net new jobs in America. According to the U.S. Census Bureau, businesses with less than 20 employees create over 97 percent of net new jobs. (http://www.inc.com/news/articles/200708/data.html) The Small Business Administration (SBA) Office of Advocacy statistics indicate that small businesses create over 90 percent of all net new jobs. (http://www.sba.gov/advo/research/rs359.pdf) Yet, even though Small businesses create almost all of the net new jobs in America, the government gives the majority of small business contracts to large corporations. That simply does not make sense.

What I am trying to do, and would like your help with, is very logical. I don’t think the government should award small business contracts to Fortune 500 firms and some of the biggest corporations from around the world. I believe that 99 percent of all Americans would agree with me, particularly in this current economic climate, that the government should not be diverting billions of dollars in contracts to large corporations that by law are supposed to be going to small businesses.

Since 2003, there have been over a dozen federal investigations, which have found Fortune 500 firms and thousands of large companies around the world as the actual recipients of federal small business contracts. (http://www.asbl.com/documents/05-15.pdf) The SBA’s Inspector General has listed this problem as the number one management challenge facing the agency for the past five consecutive years. (http://www.sba.gov/ig/onlinelibrary/tmc/index.html)

One of the most powerful stimulus bills ever written was the Small Business Act, which currently states that small businesses are to receive a minimum of 23 percent of the total value of all federal contracts, but that is not happening. On Friday, the SBA released its fiscal year (FY) 2009 small business contracting data and claimed to have awarded over $96 billion, or 21.89 percent, in federal contracts to small businesses. In reality, of the top 100 recipients of small business contracts, 60 were large businesses that received 65 percent of the total contract dollars. Some of the firms included as small businesses were: Lockheed Martin, Boeing, British Aerospace (BAE), Rolls-Royce, Raytheon, Dell Computer, General Electric and Honeywell International Corporation. (http://www.asbl.com/documents/ASBL_2009_dataanalysis.pdf)

If the Obama Administration were to simply do as federal law mandates and ensure that 23 percent of all federal contracts actually went to small businesses, it would create millions of jobs and could potentially be our strongest defense against a double dip recession.

I have helped draft a bill titled, H.R. 2568, the Fairness and Transparency in Contracting Act. It was introduced by Georgia Congressman Hank Johnson (D-04) and currently has 26 cosponsors. This legislation is deficit neutral, and will do more to help create jobs than anything proposed to date.

I wanted to bring this to your attention in the hope that you will help us with this important cause. As our economy continues to falter, and American families are faced with heartache and despair; action needs to be taken quickly before thousands more lose their jobs and their homes. A real and simple solution exists in the form of H.R. 2568, which could begin to rescue our economy from the precipice.

I am simply asking for you help, to use your influence to do anything you think would be appropriate to convince President Obama to fulfill the campaign promise he made in February 2008 in which 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)

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