No More Trickle Down Economics

Keywords for this post:
Strategic business plans
SBA Loans

It could be argued that any funds given to large businesses will ultimately trickle down to small companies (see the post yesterday on this topic). But I, for one, am very skeptical of "trickle down economics". I believe you put the money where it is needed.

And right now small businesses need support.

Since 2003, a series of over 15 federal investigations found Bush Administration officials allowed billions of dollars in federal small business contracts to be diverted to Fortune 500 firms, their subsidiaries and thousands of large businesses in the United States and Europe.

A report issued by the Small Business Administration (SBA) Office of Inspector General (OIG) referred to the diversion of federal small business contracts to large businesses as, "One of the most important challenges facing the Small Business Administration and the entire Federal government today." (http://www.sba.gov/IG/05-15.pdf)

President Obama responded to the investigations in February of 2008 with the statement, "It is time to end the diversion of federal small business contracts to corporate giants." (http://www.barackobama.com/2008/02/26/the_american_small_business_le.php)

Just days before the election, President Barack Obama dropped a comprehensive plan to stimulate the middle class economy by stopping the diversion of federal small business contracts to corporate giants. The plan was drafted over the course of three months by dozens of small business experts around the country who had been invited to serve on President Obama's small business advisory panel.

The plan included a number of policies that would have redirected up to $100 billion a year in federal small business contracts back to legitimate middle class firms around the country.

I know our good President has his plate pretty full right now. But small businesses are the real backbone of this economy, employing more than 90% of all workers. The economy cannot recover unless small businesses recover. It is time to skip the middle man and give help where help is needed.