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Will Closing the SBA Really Help Streamline the Government?

For over two years, the Obama administration has been insisting that closing the SBA will somehow streamline government. In November of 2008, I predicted President Obama would try and close the SBA by combining it with the Department of Commerce. On January 14, 2012, he proved me right and announced to do exactly that. President Obama claimed that combining the SBA with the Commerce Department would streamline government and save the taxpayers money. I find this to be ludicrous and laughable. The SBA’s budget is one thousandth of the Pentagon’s budget. An article in Mother Jones says the Pentagon spends more money in one year on candy than it would cost to run the SBA for a year.

GAO investigators and Pentagon auditors have found for years that trillion’s of dollars at the Pentagon are unaccounted for. So I ask you this, does it make sense to try and close the smallest agency in the government under the guides of streamlining government while billion’s of dollars a day go missing at the Pentagon? I say it doesn’t. I say the reality is, the Obama administration wants to close the SBA to eliminate federal programs that mandate that a minimum of 23% of all federal contracts go to small businesses. Why? Because the Fortune 500 defense contractors that seem to own Washington want 100% of all the government spends including the 23% that the Small Business Act mandates should be going to small businesses.

Don’t believe any of the PR coming out of Washington that somehow closing the smallest agency in the government and eliminating the programs that help the 28 million small businesses where most Americans work will somehow streamline the government.

Let’s look at the facts. According to the latest US Census Bureau data, 98% of all US firms have less than 100 employees. These firms are responsible for over half the gross domestic product, over half the private sector workforce, 90% of exporters and over 90% of the net new jobs.

Think of the economic lunacy of closing the only agency in government to assist the 28 million small businesses that create 90% of the net new jobs under the guides of streamlining government, while we allow the Pentagon to lose billions of dollars a day.

This is insane. What is even more shocking is that this story has gone completely unreported in the mainstream media. I haven’t seen one article anywhere that talks about the insanity of closing the only agency that helps the small businesses of America that are the economic engine of our economy under the guides of streamlining government.

Luckily for me, several journalist published stories agreeing with me that Obama’s plan to close the SBA under the guides of streamlining the government was in reality a plan to permanently close the agency.

Now the Obama Administration, having failed to close the SBA by combining it with the Department of Commerce, is trying to close it by raising the size standards on small businesses to standards that are so large that allows many of the largest companies in a variety of industries to qualify for small businesses. This puts legitimate small businesses at a competitive disadvantage and will drive legitimate small businesses out of the federal market place and make more room for large businesses.

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Lloyd Chapman

Lloyd Chapman