May 18th marks the beginning of National Small Business Week. It certainly makes sense to have a small business week. The latest U.S. Census Bureau data shows that 98 percent of all U.S. firms have less than 100 employees and these firms employ over 50.2 percent of the private sector workforce, and are responsible for creating over 97 percent of all new jobs.
Politicians in Washington routinely refer to small businesses as the "backbone of the U.S. economy." In fact, politicians spouting praise for small businesses are a daily occurrence. Unfortunately, it is usually all talk and very little action.
Lets look at the facts. To date, 100 percent of the over $2.3 trillion in economic stimulus funds have gone to states, local governments and the top 1 percent of U.S. firms. Small businesses have not received one dime of actual stimulus dollars. President Obama has promised to create or save between 3 and 4 million jobs, but all of the money has gone to the largest firms in America. Large businesses have not created one net new job in America since 1977.
90 percent of all U.S. firms have less than 20 employees, and yet both President Obama and Congress have completely ignored these firms in any allocation of actual economic stimulus funds. Virtually everything President Obama has proposed to assist our nation's 27 million small businesses is smoke and mirrors. President Obama's small business rescue plans and small business stimulus plans have been little more than a public relations campaign.
A prime example of the Obama Administration and Congress' complete lack of commitment to America's top job creators can be seen in their consistent refusal to address the diversion of federal small business contracts to Fortune 500 firms. Since 2003, a constant flow of federal investigations have been released which found hundreds of billions of dollars in federal small business contracts have been diverted to many of the largest firms in the United States and Europe. Hundreds of stories in the mainstream media have reported firms such as Wal-Mart, Home Depot, Xerox, Dell Computer, John Deere, Dole Foods, AT&T, Verizon, General Dynamics, and Halliburton have received billions of dollars in federal small business contracts.
Even some of the largest firms in Europe are receiving hundreds of millions of dollars in U.S. government small business contracts. Firms such as British Aerospace, French corporate giant Thales Communications and multi billion dollar Dutch conglomerate Buhrmann NV with thousands of employees worldwide all received federal small business contracts.
This is not abortion, gun control or gay marriage; it is Fortune 500 firms receiving government small business contracts! I think it would be difficult to find even one person in Middle America that would disagree with the notion that Fortune 500 firms should not be receiving federal small business contracts, and yet not one piece of legislation has ever been passed to address the problem.
In 2005, the Small Business Administration (SBA) Office of inspector General released Report 5-15 which stated, "One of the most important challenges facing the Small Business Administration and the entire Federal government today is that large businesses are receiving small business procurement awards and agencies are receiving credit for these awards." (http://www.sba.gov/IG/05-15.pdf)
President Obama weighed in on the issue in February of 2008 when he said, "It is time to end the diversion of federal small business contracts to corporate giants." (http://www.barackobama.com/2008/02/26/the_american_small_business_le.php)
Every month national unemployment statistics continue to increase. Some areas of the country are experiencing unemployment of over 22 percent.
It is time for President Obama and Congress to stop flapping their gums about how important small businesses are and actually pass some legislation to stop the flow of federal small business contracts to "corporate giants."