The Washington Post

It’s time to Apply Main Street Principles to the Federal Government

Whether you are an entrepreneur just starting out or a seasoned small business owner, one of the most important parts of your business plan is creating and maintaining a budget.

Small business owners around the country are contantly keeping their budgets in check. So, Benjamin asks, why can’t Congress do the same? (Jay LaPrete/AP)

If the federal government were a small business that had failed to balance its budget since 2001, it would have most likely gone out of business — not to mention having created a mountain of debt.

So what principles that small businesses live by daily could help to alleviate the problems currently being faced by the federal government?

First and foremost, the government cannot spend more money than it takes in. The easiest way to do that is by using a budget. There are tough decisions and compromises that have to be made when it comes to creating a budget. It is time that both houses of Congress realize that and come to the table to create a budget.

When creating a budget, it should never be a dollar for dollar revenue vs. expense budget. By assuming that income could be lower, so expenses should be lower, you build in a buffer for any emergency situations that may arise. If no emergencies arise, then you have increased earnings which can be returned to the business, taken as income, or better yet saved for the future.

A second principle that is successful for small business is using the barter system. This can be used for either services or products. So if you run a clothing store, you might offer an accountant either a discount or product for helping you manage your books. This concept could also be applied to the federal government. Agencies could trade services with other agencies at a reduced price.

A third principle that can be applied to the government is volume purchasing across multiple agencies.  There are generic services that are required by all agencies such as facilities maintenance, information systems support and compliance training to name a few. If these types of services can be purchased in bulk, then potentially the government could experience significant cost savings.  In this plan, several small businesses would provide larger volumes of common goods and services to the government at a volume discount.

These small business groups or co-ops, come together and purchase things such as office supplies, furniture, or in some cases even office buildings. These small businesses can get better prices since they are purchasing larger quantities. This concept can be used across the federal government. As a small business owner who bids on government jobs, I see every day that individual agencies put out individual bids. By combining these bids, there could be a reduction in costs for the agencies and a larger opportunity for the businesses bidding on the work.

Finally, the government should increase its contract spending with small businesses to gain tremendous savings in the purchase of services and goods, receive high-quality services but also enable small businesses — the heartbeat of the U.S. economy — to scale. Government contracting can help boost a small business to become a high-growth company. According to American Express OPEN research, 47 percent of small businesses active in government contracting reach the $1 million revenue mark, compared to just 5 percent of small business overall.

Keeping the books balanced is critical for the success of small businesses. They know that there is no “debt ceiling” that they can keep raising to spend more money without increasing revenues.

It is time for the federal government to come to that same realization. If a small business continues to spend or borrow without increasing revenues, it will eventually go out of business.

So what happens when the federal government continues to spend without increasing revenues? Personally, I don’t want to find out. 

Michelle Benjamin is founder and CEO of Benjamin Enterprises, a New York-based firm that manages facilities and maintenance for companies. She can be reached at



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