The Senate Finance Committee recently announced its latest scam: a small business jobs act that will do little to promote entrepreneurship or create jobs. The legislation, seemingly designed to give Democrats cover with voters in the fall, is much ado about nothing, for nothing is what the legislation does for small business. Memo to Congress: no new laws are needed to grow small businesses, just enforce the laws already on the books.
Few members of congress or the Obama Administration have ever had to experience what Jerry McGuire calls the "up-at-dawn, pride-swallowing siege," of starting a company and trying to win a customer's business. So, it’s not surprising that they do not know what’s important and what’s window-dressing.
After 15 years as a small business owner, and as the former Administrator of the U.S. General Services Administration, I've been to the circus a few times and seen all the strings connected with small business initiatives and the federal government. Too often, small businesses are used as convenient pawns in larger political battles. This legislation seems just another political ploy.
The bill promises a 2% increase in small business contracts, but the law already requires 23% of all government contracting to be awarded to small, minority, women and veteran-owned businesses. Yet, since this law is inconsistently enforced, in 2009, only one government agency met this requirement. Congress would do far better to enforce the existing law than create a new one.
Small businesses are being crushed in the federal government contracting world, where the government has direct control over contracts awarded,. Small businesses should have received approximately $181 billion in contract awards from the $787 Billion dollar stimulus—which would have been 100% more than all government small business contracting done in 2009. Instead, less than 1% of all stimulus spending has gone to small business and most in the form of loans rather than contracts.
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