It seems as if it were decades ago that individuals would come to the United States because America represented prosperity and greater opportunity. It seems as if the belief that my father had in his American dream of freedom and enterprise is now challenged and threatened.
My father was an entrepreneur and immigrant from Mexico that came to Kansas City without any money, language or power. He started picking potatoes in rural Missouri and worked for the railroad and as a janitor. During all of that time, he would say he was a businessman and did these jobs because he was saving money to start a business and become an entrepreneur. That was a very important lesson my father taught me at a very young age -- how important it was to have a vision, have a dream, work hard and build something for your family and community.
Small business has never been a minor player in American business. They employ half of all private-sector employees and create two-thirds of the net new jobs in this nation. Three-million of those small businesses are Latino owned and generate over $500 billion in revenue annually.
The problem is that the uncertainty and dysfunction created by our government leaders is proving to be destructive to small business, and even more damaging to the lasting health of our nation's economy.
Because of the level of insecurity and the most recent government shutdown, small business is being challenged and struggling unnecessarily. Small business owners are not able to make informed decisions to invest, grow and hire employees. And, it is still extremely difficult to gain access to capital and investments in order to expand their operations.
During a shutdown, if a small business has contracts with the government, it is essential they manage cash flow because payments for government work are delayed or cancelled altogether. Entrepreneurs hoping to secure loans guaranteed by the Small Business Administration are put in a holding pattern because the agency will be deemed non-essential and cease operations.
For example, the SBA guarantees and facilitates one billion dollars to small businesses every month. Many of these loans go to Latinos and other minorities. In addition, each year, the government is required to contract a minimum of 23 percent of the purchase of goods and services of federal agencies from small businesses and minority companies, equating to about $100 billion in procurement contracts each year. The shutdown ceases all of this productivity and contribution to our overall economy.
Of course, small business applauded Congress for agreeing on a solution to reopen government and avoid a default. However, once again this was a band-aid on a cancer. It's apparent that the norm in Washington is not approving a budget, but to get alarmingly close to the debt ceiling deadline and continue putting a financial burden on the future of our country by adding to our debt and increasing our nation's borrowing limit.
Small business firms were affected negatively by the prior shutdown and the politics played. However, the looming crisis will provide an even more devastating blow. Come early next year, Congress will once again repeat this endless cycle of political brinkmanship and unwillingness to compromise. And yet again, the U.S. markets will begin to slide and small business will be prevented from growing and expanding. In turn, this will slowdown business, limit loans and impair the opportunity of working for and achieving hard-earned success.
Entrepreneurs are pragmatic and anxious to get back to the fundamentals. They are demanding leadership in Washington, D.C., but not just any leadership. They are looking for truly committed and engaged individuals that will balance the budget and be fiscally prudent in order to achieve a lasting economic recovery and a long-term solution to reducing the deficit. They are hungry for leaders committed to a job-creating environment that provides incentives and common sense regulation and law making. And they are seeking representatives that will fight to reduce taxes and roadblocks on small businesses in order to encourage even more productivity and job creation.
Small businesses are demanding leadership that signals real growth and stability. They are praying for a comprehensive economic policy that calms their uncertainties and instills confidence. Furthermore, they want to stop the continual state of crisis that is destructive for consumers, investors and businesses of all sizes.
Entrepreneurs are the engine of America and the key to an American resurgence. Therefore, Congress needs to come together, once and for all, take action and eliminate all the barriers that are detrimental to the future of realizing that exceptional "American Dream."
-- Hector Barreto is the Chairman of The Latino Coalition and the former U.S. Small Business Administrator.