The Small Business Administration blasted President-elect Barack Obama’s SBA transition team leader for writing a “largely inaccurate, outdated and misleading” analysis of the agency’s record during the Bush administration.
Fred Hochberg, an SBA deputy administrator during the Clinton administration, analyzed the agency in a chapter submitted for Change for America, a compilation of advice for the new administration published by the Center for American Progress Action Fund and the New Democracy Project.
Hochberg recommended the agency be granted Cabinet-level status, as it enjoyed during the Clinton years, so small businesses would have a voice in overall economic policy. He also contended the SBA “was decimated by budget cuts during the Bush administration.” The agency “lost its vision and energy,” he wrote.
He went on to criticize the decision to end federal subsidies for the SBA’s 7(a) loan program; failures to ensure small businesses win their share of federal contracts; and the agency’s poor performance in getting disaster loans to victims of Hurricane Katrina.
The SBA’s press office responded Dec. 11 with a three-page “news release/fact sheet” that refuted Hochberg point-by-point. The agency’s budget hasn’t shrunk, it contended, if one excludes congressional earmarks; disaster loan funds, which vary year-to-year; and the $120 million that formerly subsidized 7(a) loans. That loan program is now self-supporting through fees on borrowers and lenders – fees that Hochberg contends are too high.
SBA lending was down in fiscal 2008, the fact sheet conceded, but the agency still approved 30 percent more loans than it did during the Clinton administration’s best year.
The SBA also has taken steps to hold agencies accountable for meeting their small-business contracting goals and has “completely rebuilt” its disaster loan program, the fact sheet noted.
The news release ends by saying the “SBA will continue to welcome Mr. Hochberg as a member of the president-elect’s transition team and looks forward to working productively with him and his colleagues.” But, it added, Hochberg’s analysis “does not advance the cause of informed debate on the future of the agency.”