Abolish the Small Business 8(a) Program
Abolish the Small Business 8(a) Program
One of the largest areas of waste, fraud, and abuse is the US Small Business program run by the Small Business Administration. Here is why I say that.
There is a notion that the US government should include small businesses in their procurement decisions and awards throughout government. Congress established a huge bureaucracy to manage its procurements called the General Services Administration (GSA). The idea behind the GSA is to centralize the administration process to drive down the cost of procurement. However, Departments all have their own procurement organizations that compete with GSA such that there is even more redundancy and inefficiency.
Congress wanted to ensure that small businesses get a piece of the action, so they created an entire administration just to define the process for accomplishing that. Congress set up an allocation system to ensure that various minority groups get a set-aside share of the business. Government customers are rewarded (or punished) for meeting certain goals to award procurements that include prime and subcontracting to small business.
What is wrong that? First, most of the small businesses are not commercially viable. That is, without the government as a customer, they would not exist or survive because they do not provide highly differentiated and superior capabilities. Their existence is solely dependent upon playing the bureaucratic procurement game.
This means that taxpayers pay for deficient performance as procurement are not solicited from commercially viable contractors.
This situation may well apply to large government contractors as well that have little or no commercial business. This is the heart of the Military Industrial Complex problem. It is the start of the undermining of American competitive performance.
Needed is a complete change in values whereby to be qualified for government business, all firms, regardless of size generate at least half of their revenue from serving commercial customers with superior products and services.
Making this a requirement will shift emphasis from military defense to commercial product invention and manufacturing. It starts with changing the requirements for what qualifies companies to serve government customers.
Small businesses that serve only government customers are on welfare, just as large businesses do the same thing. With rare exception, they do not contribute to the gross domestic product. This is fundamentally at the heart of America’s economic problem, I believe.
Ironically, Republicans are at the core of the problem as well. Many Republican states are on welfare.
“U.S. Representative Mick Mulvaney (R-SC), chairman of the Subcommittee on Contracting and Workforce of the House Small Business Committee, will be the featured luncheon speaker at the COFPAES Federal Markets Conference on Thursday, September 22 at The American Institute of Architects in Washington, DC.
COFPAES (www.cofpaes.org), the Council on Federal Procurement of Architectural & Engineering Services, will host the one-day conference to provide architecture-engineering (including surveying and mapping) firms a look at upcoming contracting opportunities in Federal agencies.
"The conference will provide the A-E profession a forecast on procurement opportunities with the Federal government over the coming months. Firms need to not only know where the work is in order to be competitive, but they need to know what the rules are and how government policy will affect their business. As chairman of the small business contracting subcommittee, Rep. Mulvaney is in the thick of efforts to reform the 3 percent withholding, insourcing, project labor agreements, the definition of inherently governmental functions and other policy issues that are inhibiting or threatening private sector job creation. His remarks at the COFPAES conference will help firms understand these issues so they can plan for the future," said John Palatiello, COFPAES Administrator.
Top Federal A-E professionals and contracting officials from key agencies, such as the US Army Corps of Engineers, NAVFAC, the Air Force, GSA Public Buildings Service, FHwA, Bureau of Prisons, DHS, BLM, MCC, OBO, and USAID will present information on current programs, the anticipated FY12 budget, and the agency's requirements for acquisition of A-E services from the private sector.
The conference will be held at The American Institute of Architects, 1735 New York Avenue, NW, Washington, DC 20006. Registration is $195 and can be processed at www.cofpaes.org.
First elected to Congress in 2010, Rep. Mulvaney represents the 5th district of South Carolina. In addition to the Small Business Committee, he serves on the House Budget Committee and the Joint Economic Committee. Rep. Mulvaney has experience working the with the A-E profession, having been engaged in the home building and real estate business earlier in his career and prior to his election to Congress.”