Over the past decade the federal government has awarded billions of dollars in small business contracts to foreign owned corporations. Dating back to data from Fiscal Year (FY) 2000, we have seen foreign-owned firms repeatedly receive federal contracts that could have been awarded to American small businesses.

The diversion of federal small business contracts to large American corporations has been well documented through a series of investigations by federal watchdogs like the Government Accountability Office (GAO), the Small Business Administration Office of Inspector General (SBA IG), the Department of Interior IG, and the SBA Office of Advocacy. While the small business community has long been entrenched in an uphill battle against American mega-corporations, the co-opting of small business contracts by foreign corporations is a continuing trend that has garnered little to no investigation or reporting.

The companies capitalizing on this blatant lack of oversight include UK corporations like British Aerospace Engineering (BAE), QinetiQ Group and Rolls-Royce. Finmeccanica S.p.A, an Italian defense technology conglomerate that employs over 70,000, and Ssangyong Group out of South Korea, are prominent multinational corporations that have also received American small business contracts.

QintetiQ is a typical example of a large, foreign owned corporation receiving federal small business contracts. QintetiQ is a publicly-traded British owned firm with $2.2 billion in annual revenue. A QinteiQ subsidiary, ITS Services, is a company with over 1000 employees and $200 million in annual revenue.

The continued diversion of billions of dollars in small business contracts to large firms is severely deterring our nation’s top job creators from hiring new employees. According to the U.S. Census Bureau, small businesses create over 90% of all net new jobs. When foreign-owned companies are able to take a sizable cut out of capital already being diverted away from small businesses, it is tantamount to salting a fresh wound.

Ending the diversion of federal small business contracts to corporate giants, both foreign and domestic, would put more existing federal spending into the hands of our nation’s chief job creators than anything proposed by the Obama Administration to date. In February of 2008, President Obama promised to end this abuse. He has yet to make good on this promise.

If the President is serious about job creation and economic stimulus, he should implore Congress to pass the Fairness and Transparency in Contracting Act (FTCA). This bill will prevent foreign-owned companies from receiving small business contracts. By passing the FTCA and ending the diversion of small business contracts to the largest corporations in the US and abroad, the President and Congress can infuse the nation’s middle class with billions in existing federal infrastructure spending, a huge step in climbing out of this recession and spurring job growth on the local and state levels.