Do Apple, Bank of America, GM and Chevron Sound Like Small Businesses to You?

The most recent data from the Federal Procurement Data System (FPDS) shows that last year the Obama administration diverted billions of dollars in federal small business contracts to some of the biggest companies in the world.

A report from the American Small Business League (ASBL) conducted using FPDS shows that 72 of the top 100 federal small business contractors during fiscal year (FY) 2011 were large companies. This number is up from FY 2010 data, which showed 60 large companies among the top 100.

The federal government has a statutory goal of awarding 23 percent of all federal contract dollars to legitimate small businesses. However the federal government has never hit the 23-percent small business contracting goal. Due to fraud, abuse and loopholes, federal agencies report contracts awarded to large companies as small business contracts.

Since 2003, more than a dozen federal investigations have uncovered billions of dollars in federal small business contracts being diverted to large corporations. In a report from October 2011, 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."

According to the FPDS, large companies that were among the top 100 small business contractors for FY 2011 include: BlueCross BlueShield, Sierra Nevada Corporation, General Dynamics Corporation, Harris Corporation, VSE Corporation, GTSI Corporation, Jacobs Engineering Group Inc., Spectrum Group International, Inc., CVR Energy, Inc., Rockwell Collins, Inc. and several others. Each of these companies received at least $86 million in federal small business contracts in FY 2011, and some received upwards of $240 million.

Large companies that were not among the top 100 small business contractors (meaning they received less than $86 million) but received federal small business contracts during FY 2011 include: Apple Inc., Lockheed Martin Corporation, British Aerospace (BAE), L-3 Communications Holdings, Inc., Home Depot, General Motors, Toyota, Sony, Siemens, Ford, Citigroup, IBM, Verizon, ManTech, Shell Oil Company, Chevron Corporation, JPMorgan Chase and co., Coca-Cola, Science Systems and Applications Incorporated (SAIC), PepsiCo, Inc., Bank of America, Wells-Fargo, Panasonic, CVS, Thomson Reuters, General Electric, Comcast, Time Warner, The New York Times Company, Gannett Co. Inc., Hearst Corporation, Walt Disney World Co. and many others.

Misrepresenting your firm as a small business is a felony, but the Department of Justice has NEVER prosecuted a single offender.

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 to 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.

This most recent report from the ASBL is strong evidence that the proper steps to end fraud, abuse and loopholes in federal small business contracting programs have not been taken. House Small Business Committee Chairman Sam Graves and his colleagues recently introduced a number of new bills to increase the amount of contracts that small business could receive. However, none of the new pieces of legislation are designed to prevent some of the largest companies in the world from receiving billions in small business contracts every month, and are rendered moot.

The Obama administration needs to act by supporting a complete reform of federal small business contracting programs, and changing its decision to close the SBA.

 

Follow Lloyd Chapman on Twitter: www.twitter.com/LloydChapman

Comments

[sunelpru]

12:46 PM on 03/01/2012

the gov. and politions are all corrupt!!!!!!!!!!

[dtwrites]

12:38 PM on 02/29/2012

This is wrong from a governmental and business perspective. This practice should be discontinued. Amazing how large corporations keep finding ways to receive more government support. If they were individuals receiving these large amounts of governmental support, people would shame them to no end. Until this practice changes, small businesses are going to have to get smarter and find more ways to access funds like larger companies do. That actually might force more change.

Denise
http://www.writemoneyinc.com

[Shaun McGinnis]

11:58 PM on 03/02/2012

We are getting smarter Denise!

www.tgclf.com helps small businesses get the information needed to get these contracts.

Shaun

[wickedtwisted2]

11:35 PM on 02/28/2012

This is an outrage and should be front page news. Mr Obama, where are you? You promised us CHANGE WE COULD BELIEVE IN... what happened? Honestly.... WHAT HAPPENED? It's become next to impossible to staunch the endless criticism of your four years in office. As an outspoken supporter of yours, believe me son when I say I have received so MUCH ABUSE! It has gotten to the point that we cannot talk politics in polite society!! EVER! Please do what you promised to do... it's been a shame that what is contained in this article has transpired if it is true.

[Jesse Becker]

11:27 PM on 02/28/2012

Considering the ever decreasing number of small businesses in this country it's not surprising that the larger corporations would step in and lay claim to as much funding as possible. One of the best qualities of American life was once building something out of nothing and maintaining the family business. Parents would teach their children and children would be certain that a job was always available to them. With that no longer being the case it's just sad to sit back and watch the re/misallocation of money in corporate America. If only we had done the right thing from the beginning and allowed success to happen to anyone who was willing to work hard and attain it on a moral and ethical level. Things are troublesome now but I'm sure much better than the way it will be "tomorrow". The powers that be have written the laws providing loopholes that are used to manipulate the masses and encourage predatory business tactics. They are very good at it and the daily struggle of every middle to lower class worker in America can appreciate just how phenomenal of a job they are doing. The only ones who tell their kids they can be anything, and mean it, must have the financial backing to ensure the dream is feasible.

[I Man]

09:31 AM on 03/01/2012

Good article!! And I am one of those forgotten small US businesses started from nothing but hard work, little personal money, and still going against the odds out there. But it is hard.

The public has been so misinformed on real facts and are brainwashed by a very one-sided media too. Everything is so manipulated from corp America to Wall Street.

It is hard to hire anyone especially younger people, because they want entitlements and large incomes from the get-go yet do not possess skills nor care to learn them- and in the construction industry where I have been over 30 years, you do not hear of "apprenticeships" any longer nor see quality technical schools we once used to have. And there is no middle class left, unless you earn $80,000.00 which is what Congress deemed middle class a few years ago when questioned about it.. We are all mostly working poor, supporting 50% of the population who does not work, and 1/4th the US now on some sort of welfare program. When you factor all the illegals in it gets worse, and when you factor the millions of people who now fallen off the radar and their 99 weeks of UE the jobs report misses, the picture starts to look much different than what this Administration is trying to spin through the liberal media outlets....