Small Business Administration Faces Sweeping Changes Under Obama Plan

The Small Business Administration will be consolidated into a larger general agency, as part of a new Obama administration plan announced Friday.

The move would combine the SBA with five other government offices -- the Department of Commerce's core business and trade functions, the Office of the U.S. Trade Representative (USTAR), the Export-Import Bank (Ex-Im Bank), the Overseas Private Investment Corporation (OPIC) and the Trade and Development Agency (USTDA) -- to form a single agency. The Washington Post estimates the changes will eliminate an estimated 1,000 jobs and save $3 billion over 10 years. While the SBA would no longer be a standalone agency, the SBA administrator position is expected to be elevated to cabinet level, as it was under the Clinton administration.

"The government we have is not the government we need," Obama said. "It’s redundant and inefficient. With the authority I am requesting today, we could consolidate them all into one department."

According to a White House statement, this department will be "where entrepreneurs can go from the day they come up with an idea and need a patent, to the day they start building a product and need a warehouse, to the day they are ready to export and need help breaking into new markets overseas. The new Department will lead the development and implementation of an integrated, strategic, government-wide trade effort and have a focused capacity to help businesses grow and thrive."

Todd McCracken, president and CEO of National Small Business Association, responded in a statement, "While NSBA is firmly committed to reducing the deficit, there simply aren't enough details available yet to know if this will be a net win or loss for small business. On the one hand, reorganizing federal agencies to create a 'one-stop-shop' for America's small businesses could streamline processes and make accessing information and assistance much easier. On the other hand, such a reorganization could minimize the emphasis placed on small business by the federal government and lead to an even greater imbalance toward promoting the interests of large businesses over those of small business.

"Any proposal to consolidate agencies must ensure that SBA, Ex-Im Bank, OPIC, USTR and USTDA remain thriving vehicles for the U.S. to promote entrepreneurship," McCracken added. "Anything short of that would be a disservice to America's small businesses and the U.S. economy."

Comments

[parabq]

11:10 AM on 01/15/2012

Look at that chart !!!!!!!!!!! That should show how incompetent govt is !!!!!
Geeeeeeeezzz The SBA is nothing but a slush fund for inside people with govt connections and minorities getting loans for their business. If your a legitimate operating business run by a white male
your way out of luck. !! They should shut down this "nanny state" agency !!!

[conservgirl8]

04:35 PM on 01/14/2012

Just the word "sweeping" change is enough to worry me. This administration seems to want to do everything they can to change and alter the way this country works in a sweeping way!

[cerdayes]

10:06 AM on 01/15/2012

it would appear that you have been asleep , wake up this country has been country has been changing for 30+ years. don't be so ignorant, takes several bad presidents and several bad congresses to screw-up this bad.

[conservgirl8]

11:00 AM on 01/15/2012

Yet again, another angry liberal/progressive. My comment was directly aimed at this administration and the headline right now. I am fully aware that the progressive movement has been ramping up over time. Yes, it does take many bad presidents and several bad congresses to screw up and this one is on a speed trip. Just for your information, if you want to argue my statement can't you do so without being so defensive and angry? Your insecurities are showing.

[smoker]

03:30 PM on 01/14/2012

Makes o difference. Ever try getting a SBA loan or an Ex-Im loan? Ever tried approaching the US Dept. of Commerce? The banks accredited to SBA flat out refuses to give a loan saying that the minimum turnover of the applicant should be $10million and have assets for collateral. By what stretch of imagination does that qualify as a Small Business? Or else, they don't have the money to loan as they've already completed their target by lending out to to bigger businesses. For an Ex-Im loan, same story. Give us collateral. As for the US Dept of Commerce, it is solidly Republican and supports the corps only. Approach them as a SBA and they've nothing to offer which suits your requirements.

As I said, this move from the administration makes no difference to the small business owner who needs capital to grow.

[Tiggy]

12:44 AM on 01/15/2012

I was seeking loan for small business, received a form in the mail from SBA which stated for Start ups and small business loans call #. I called to be told I needed to contact our regional contact. Contacted him to be told must go through bank. Went through bank to be told no unsecured lending and no lending to start ups or businesses that had not been open two year + and for that qualified, they had to have 100% collateral. Wow, with that type of standing why would I need a loan? So all that paper and ink was a waste not to mention the money it cost to produce it. The SBA left it up to the very banks that weren't lending! What a complete joke.

[liltrix]

02:14 PM on 01/14/2012

Release the McCracken!

[POTSman244]

01:58 PM on 01/14/2012

Ever notice when 0 makes a speech on the economy, or lack of it (insert blaming Bush, here) that the Stock Market takes a plunge? Thanks

[liltrix]

02:12 PM on 01/14/2012

Ever notice how incredibly ridiculous a statement like yours is? The stock market took a plunge based on the down grade of European markets yesterday. Pull your head out!

[thomgrisso]

01:34 PM on 01/14/2012

One of the fist acts of Obama was to take away the private sector student loanprocesses and those jobs and make more govt jobs .

Now it is the SBA loans out of the hands of capitalist into the hands of socialist Take away private sector jobs to create govt jobs.

[nothingchanges]

11:47 AM on 01/14/2012

As a (former) small business owner I have to say that Small Business represents everything good about capitalism.

WE compete.
WE try our darndest, to provide the best possible services, at the lowest possible prices.
WE hire our neighbors, and most of us treat our employees well.
WE say what we mean, and mean what we say.

Big Business, for the most part, can't make those claims.
They don't compete, they collude. They drive out small businesses with unfair competition, then jack up their prices to whatever the market will bear.
The pay as little as they possible can, outsourcing jobs to countries where they can take advantage of cheap labor, and lack of safeguards. If an "employee' is injured or killed on the job, no big deal, there are lots of others willing to take their places.
Over 60% of television viewers are unhappy with their service provider, whether it be cable or satellite. Small business would never survive with those kind of statistics.

Yet Government panders to Big Business, and for the most part ignores Small Business.

Why?

Because Big Business pays for politicians campaigns, and the politicians owe them their elections.

Big Business has become Big Brother.........they OWN this country, and the government that runs it.

[butdoyou]

04:13 PM on 01/14/2012

Very few small business owners treat employees well. 20 years in the auto repair field. The business people I've worked for take all they can. pay as little as they have too, and invest virtually nothing back in their businesses. The employees are always to blame for the problems related to their work.

[redraspberry]

08:31 AM on 01/15/2012

I'll agree with that. The last place I worked was a new water bottling plant. In three years they ran both the machinery and the people into the ground. 12 hour days and a 24/7 operation. We didn't even get the chance to PM most things. And when we did find problems it was run it till it breaks then order the part overnight. While blaming the maintenance staff for not being able to make things work with duct tape and bailing wire. It was ridiculous.

[Cratewasher]

11:14 AM on 01/14/2012

This seems to fit from a president who puts Monsanto executives on point at the FDA.

[Cratewasher]

11:14 AM on 01/14/2012

Small Business again usurped by big business as usual.
Did Obama get this idea from Romney, too?

[AZreb]

10:19 AM on 01/14/2012

Sheesh - thought he might be taking Boeing and other huge corporations off the list of "small businesses" that get government contracts and funding. Disappointed - again.

[CAELadyJane50]

08:52 AM on 01/14/2012

After reading the article on HuffPost "Romney and his European Straw Dog" by Edward Goldberg, I realized why this SBA got downsized, it is because the S&P European Market got downgraded so this means Europe will not be buying as much exports from the U.S.

[yougg]

08:21 AM on 01/14/2012

This may be a strategy to make commerce more localized. With globalization and large corporations money leaves an individual community. Back in 2002 I attended Master Gardeners class through the County Extension service in my county. They were giving training for starting small scale food production. Not a bad idea.

[Jeff081]

02:15 AM on 01/14/2012

An article in the Drudge Report on this subject started out, Is Obama Trying to Out-Romney Romney? He had three years to do this, why now?

[frank day]

06:58 AM on 01/14/2012

Other stuff going on.

It takes a lot of time to clean up after an Elephant.

[Barbarian At The Gate]

01:53 AM on 01/14/2012

I hope the move will be very beneficial to small businesses. Small Businesses have a bigger stake in creating more jobs in the US than large multi-nationals that have locations all over the world.

[nvr2late]

11:43 AM on 01/14/2012

I hope so too. But from my own experience, small business start-ups need a big break in licenses, fees, etc, etc. For instance, to LLC your company in California cost around $800 a year. I was told that in Texas, for example, it is a fraction of that. California makes it next to impossible for small businesses to thrive Would welcome any arguments on this.

[Barbarian At The Gate]

11:48 AM on 01/14/2012

I agree, there is a difference between NY corporate laws and Florida corporate laws as well. Most people would say Delaware has the least stringent laws and that is why many US companies file there. There are benefits to filing in the State where the business actually exists.

[jenyouwino]

12:32 AM on 01/14/2012

Whenever I hear about more "sweeping changes" by Obama, I cringe with the thought that once again he is up to no good. He says one thing; does the opposite, and is cut no end of slack by the media. He is at his best when he does absolutely nothing, but unfortunately he is committed to his many financiers and special interest supporters to push their progressive agenda. Here we've got another senseless example of his continued fiddling while the US burns. $3 billion over 10 years! You've got to be nuts to believe that this is anything but delusional pandering to the worshiping masses - and sad to say, there are millions of them out there. Oh, and what about the 1000 who will lose their jobs? Let's face it, 60% of government workers are hidden unemployment anyway. So what will we really save? The difference between long term unemployment insurance and their taxpayer funded salaries? Sorry, but the math doesn't work.