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A recent investigation by NBC into the diversion of federal small business contracts to corporate giants turned up pay dirt. In just a small sample of contracts awarded to small firms in the San Francisco Bay Area, NBC uncovered hundreds of millions of dollars in federal SMALL BUSINESS contracts being awarded to large firms such as IBM, Oracle and Hewlett Packard.
The fact that NBC found millions in federal small business contracts going to some of the largest companies in the world is nothing new. Federal investigators have sounded the alarm on blatant fraud, abuse and a complete lack of oversight on the part of the Small Business Administration (SBA) since 2003.
In an investigation conducted by the General Accounting Office (GAO) in 2003, the GAO found more than 5,000 large businesses had received federal small business contracts.
In 2005, the Small Business Administration Office of Inspector General (SBA OIG) released Report 5-15, which described the diversion of federal small business contracts to corporate giants worldwide as, “One of the biggest challenges facing the Small Business Administration and the entire federal government today.” The SBA OIG has reiterated this statement for the last SEVEN CONSECUTIVE YEARS, including every year that Barack Obama has been President.
What makes this issue even more troubling for the Obama administration is the fact that President Obama acknowledged the magnitude of the rampant abuses against America’s 27 million small businesses during his campaign. In February of 2008, Obama released the statement: “It is time to end the diversion of federal small business contracts to corporate giants.”
To date, President Obama has refused to keep his campaign promise to the middle class, and the diversion of federal small business dollars to world wide corporate giants has increased.
In May 2011, the Obama administration reported $370 million in contracts awarded to Rosoboronexport, an international arms dealer owned by the Russian government, as contracts intended for small business.
The most interesting fact about the NBC investigation was the SBA’s response. As usual, the SBA refused an interview request regarding the investigations, and instead blamed the billions of dollars in federal small business contracts that have diverted to corporate giants worldwide as “anomalies.”
Obama administration officials were unable to explain why these anomalies always seem to report the federal awards to corporate giants as small business awards but never the other way around. In addition, not one federal investigation since 2003 has found any merit in the Obama administration’s excuse that the diversion of federal small business contracts to corporate giants was the result of any random pattern. Clearly, if the problem were the result of legitimate data entry errors, simple human error, computer glitches or any type of anomalies, it would have a random pattern with an equal disbursement. It’s like flipping a coin, the law of averages dictates half the time it would come up heads and the other half it would come up tails.
It seems every time anyone discovers Obama officials diverting federal small business funds to corporate giants, it’s always considered an anomaly, or what I have decided to call, “Obamalies.” The main difference between anomalies and Obamalies is anomalies are random. Obamalies always seem to hurt small businesses and help corporate giants. You know, the kind of corporate giants that donate tons of money to political campaigns.
Since President Obama took office, Obamalies have been responsible for diverting hundreds of billions of dollars in federal small business contracts to firms, such as Boeing, Hewlett Packard, AT&T, Motorola, Raytheon, Lockheed Martin, Apple, John Deere, Rockwell Collins, General Electric, General Dynamics, Office Depot, Xerox, Dell and ManTech.
Here is the real tragedy of this story: According to the U.S. Census Bureau, small businesses are responsible for more than 90 percent of all net new jobs in America. 98 percent of all U.S. firms have less than 100 employees. Small businesses are responsible for more than 50 percent of the private sector work force and more than 50 percent of the gross domestic product. Additionally more than 90 percent of all U.S. exporters are small businesses.
Federal law currently requires that a minimum of 23 percent of the total value of all federal contracts be awarded to small businesses. It makes sense to me to invest our tax dollars back into the firms where most Americans work and where the overwhelming majority of net new jobs are created.
Unfortunately, Obamalies have diverted hundreds of billions of dollars in federal funds that, by law are allocated to legitimate small businesses, into the hands of hundreds, if not thousands, of the largest companies around the world.
If anyone is looking for the real answer to why our nation’s unemployment numbers are still too high and why more than 23 million Americans are still out of work, take a long hard look at Obamalies and you just might find an answer.