PETALUMA, CA--(Marketwired - Sep 30, 2013) - President Obama has resurrected Ronald Reagan's plan to permanently close the Small Business Administration (SBA) by combining it with the Department of Commerce and has renamed it "streamlining government."
Reagan made it clear that he wanted to permanently close the SBA during his term as president. His plan to close the SBA was to combine it with the Department of Commerce.
In January of 2012, President Obama announced his plan to close the SBA in the same manner Reagan tried. I first predicted President Obama would try and close the SBA by combining it with the Department of Commerce in November of 2008.
Reagan faced stiff opposition to "closing the SBA" and ultimately, his plan failed. To avoid the dramatic opposition Reagan faced in outright "closing the SBA," President Obama has simply renamed Reagan's plan "streamlining government."
By naming his plan to close the SBA "streamlining government," President Obama has succeeded in avoiding the public outcry and opposition Reagan faced and he has been able to avoid any media coverage of his plan to close the SBA. So far, not one major media outlet has mentioned that President Obama has adopted the exact same plan Reagan used to try and close the SBA.
Federal law requires that a minimum of 23 percent of all federal contracts be awarded to small businesses. Pentagon prime contractors are the force behind the plan to close the SBA. If the SBA was dismantled along with the 23 percent small business goal, 100 percent of all federal contracts would likely go to large businesses, particularly those in the defense and aerospace industry.
Federal prime contractors are also required to award 23 percent of their subcontracts to small businesses. A series of federal investigations, litigation and media reports have all found prime contractors have falsified their compliance with the 23 percent small business-contracting goal and that most federal small business contracts actually go to large businesses.
The diversion of federal small business contracts to corporate giants has been widely reported in the mainstream media. The SBA Office of Inspector General has named the diversion of federal small business contracts to corporate giants as the number one problem at the SBA every year of the Obama administration.
Once the SBA is combined with the Department of Commerce, the 23 percent small business contracting goals will be quietly dismantled and the rampant fraud that has been uncovered at the SBA and the Pentagon will become a moot point. With the SBA closed, President Obama can avoid more embarrassing federal investigations and investigative stories about the rampant fraud at the SBA.
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