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Obama Small Business Agenda Contains Major Hole

May 19, 2011

Petaluma, Calif. – On Monday, May 13, the Obama Administration released what President Obama called “The Small Business Agenda: Growing America’s Small Businesses to Win the Future.”  After carefully evaluating President Obama’s small business agenda, the American Small Business League (ASBL) was surprised to find that the plan ignores the diversion of billions of dollars a year in federal small business contracts to large corporations. (http://www.whitehouse.gov/the-press-office/2011/05/16/white-house-releases-small-business-agenda-growing-americas-small-busine)  

Since 2003, a series of federal investigations have found that most small business contracts actually go to Fortune 500 firms in the U.S. and other large businesses around the world. (http://www.asbl.com/documentlibrary.html)  

- In Report 5-14, the Small Business Administration Office of Inspector General (SBA IG) found that the SBA itself awarded small business contracts to large corporations. The report stated, "The SBA awarded four of the six high dollar procurements, reported as small business procurements, to large companies at the time of the procurements." (http://www.asbl.com/documents/05-14.pdf)  

- In Report 5-16, the SBA IG found that federal agencies had allowed large businesses to illegally receive federal small business contracts by making "false certifications," and "improper certifications." (http://www.asbl.com/documents/05-16.pdf)  

- In Report 5-15, the SBA IG 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." (http://www.asbl.com/documents/05-15.pdf) The SBA IG’s office has continued to report the diversion of federal small business contracts to large businesses as the #1 challenge at the agency for six consecutive years.

The most recent data released by the Obama Administration shows recipients of federal small business contracts including: Boeing, Lockheed Martin, Northrop Grumman, Raytheon, Dell Computer, Xerox, SAIC, General Dynamics, Bechtel and John Deere. (http://www.asbl.com/documents/05-15.pdf; www.asbl.com/documents/ASBL_2009_dataanalysis.pdf)

President Obama acknowledged the magnitude of the problem during his 2008 presidential campaign when he released the statement, “It is time to end the diversion of federal small business contracts to corporate giants.” (http://www.asbl.com/documents/20081007_Obama_Promise_Website.pdf)

“The Obama Administration’s small business agenda is all smoke and mirrors.  When you look at what he does, it is completely different from what he says.  If you want to know what the truth is look at what the SBA Inspector General has said for six consecutive years; most small business contracts actually go to large businesses,” ASBL President Lloyd Chapman said. “If President Obama wants to help small businesses and stimulate the economy, all he has to do is keep his campaign promise to end the diversion of federal small business contracts to corporate giants.”

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