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Obama Administration Still Diverting Billions in Small Business Dollars to Corporate Giants

February 23, 2012

Petaluma, Calif. – The most recent data from the Federal Procurement Data System shows that the Obama administration has diverted billions of dollars in federal small business contracts to some of the biggest companies in the world. According to federal data, 72 of the top 100 federal small business contractors during fiscal year (FY) 2011 were large companies.
 
The federal government has a statutory goal of awarding 23 percent of all federal contract dollars to legitimate small businesses. Yet since 2003, more than a dozen federal investigations have uncovered billions of dollars in federal small business contracts being diverted to large corporations.
 
In February 2008, Barack Obama addressed the magnitude of this problem stating, “It is time to end the diversion of federal small business contracts to corporate giants.” Since taking office, President Obama has failed adopt policies to end fraud, abuse and loopholes in federal small business programs. In fact, many of his policies will dismantle or weaken federal small business contracting programs.
 
In an October 2011 report, the Small Business Administration Office of Inspector General (SBA IG) said the SBA’s top management challenge was that: “Procurement flaws allow large firms to obtain small business awards and agencies to count contracts performed by large firms towards their small business goals.”
 
Large companies receiving federal small business contracts in FY 2011 include: Apple, Chevron, Shell, General Motors, General Electric, Coca Cola, Bank of America, Wells-Fargo, Citigroup, Home Depot, Xerox, Toyota, Sony, Verizon, BlueCross BlueShield, General Dynamics, Harris Corporation, Rockwell Collins, Time Warner, The New York Times Company, The Washington Post Company, Thomson Reuters, Gannett, Hearst Corporation, British Aerospace and Engineering, Lockheed Martin, Boeing, Italian defense firm Finmeccanica, and many more.
 
“The Small Business Act defines a small business as one that is independently owned,” said ASBL President Lloyd Chapman. “President Obama could simply issue a one line executive order that says: ‘The federal government will no longer report contracts awarded to publicly traded companies as small business contracts.’ That would redirect more federal infrastructure spending to the middle class and create more jobs than anything President Obama has done since taking office.’”
 
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