The Bush Administration misrepresented data to meet contract allocation requirements, according to a report released by Democrats of the House Small Business Committee. The government is required to give at least 23% of its contracts to small business, but has failed the past six years. The Small Business Administration (SBA) claimed to have exceeded this threshold in 2005, but actually fell short because $12 billion it said was given to small businesses was in fact given to large ones.
Some of the miscategorized contracts went to some of the biggest companies in the world, including Microsoft, Rolls-Royce, Wal-Mart, Exxon Mobil, Google, and Lockheed Martin. Among others were large media companies like the Associated Press, The New York Times, USA Today, Bloomberg, and PBS.
What we are seeing is a sheer lack of accountability from the administration that is resulting in these large businesses receiving small business awards," said Rep. Nydia Velázquez, the committee's ranking Democrat. "As a consequence, entrepreneurs are getting less and less contracting opportunities each year."
According to Velázquez, miscoding first became a large concern in 2004, when $2 billion was incorrectly labeled. The number has ballooned since then to six times that amount. More than 2500 large compaines and ineligible entities counted as small businesses received contracts.
The findings come in contrast to claims by Bush that he is concerned about helping small businesses, which has been part of the Republican justification for cutting the estate tax. Two months ago, the watchdog group American Small Business League (ASBL) condemned Bush for gutting the SBA, which was intended to promote small businesses, by 31% since he took office. "It's not a matter of whether the Bush Administration is going to close the SBA- they're closing it as we speak," said ASBL founder Lloyd Chapman.
In addition to the overall small business goal not being met, the government failed in every sub goal as well. Women-owned businesses have lost $5.2 billion and minority-owned businesses have lost $4.5 billion in contracts.
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