According to a Gallup poll, 96% of the public have a positive view of the Small Business Administration (SBA). Due to its high reviewing, many proposed adjustments to the organization are argued down in simple fashion. Although a majority of the public favor the SBA, I believe this has more to do with the concept of the organization and less about how it runs its business.
Let’s highlight a few key points concerning the SBA. Did you know that a “2011 study by the libertarian Cato Institute found that the biggest recipients of SBA-backed loans in 2009 were restaurants (including fast-food franchises), gas stations, dentists, beauty salons and motels.” As a nation, I honestly feel that tax payers deserve a say in where their investment dollars go. In addition to the random industries selected for investment, borrowers who received funding “represented 2 percent or less of the total industry”. That is amazing considering that, by the definition of the SBA, 98% of company’s qualify for loans.
According to the Washington Post, the major benefiters are big banks such as Wells Fargo and JPMorgan Chase. These banks commit the most money to the SBA as lenders with a lovely government guarantee that the US will pay them back if a small business cannot.
In 2012 President Obama sought to streamline government processes, “consolidating six agencies that focus primarily on business and trade — including the Small Business Administration (SBA) — into one new department.” The idea was that less government would simplify programs and processes in an effort to aid small businesses looking to connect with the SBA. Why this was shot down I have no idea. Less government and a simple process should be a basic tenet for Republicans, but alas they disagreed.
As we move forward, the new head of the SBA Linda McMahon (who agreed with the Obama plan), will now take office and look to grow the SBA in her image. Time will tell how good of a job the new head will do but we can all agree that the SBA is in desperate need of changes.