Small business committees, advocates hesitant to back Obama’s restructuring proposal

Lawmakers and small business advocacy groups Friday applauded President Obama’s decision to add a cabinet seat for the head of the Small Business Administration, but many were hesitant to back his broader proposal to restructure part of the federal government.


Senate Small Business and Entrepreneurship Committee Chair Mary Landrieu said she is open to streamlining government functions but wants to see more details of the president’s plan. (Alex Wong/GETTY IMAGES)

“This platform could provide an opportunity to advocate for small businesses in an environment where important decisions are made,” Graves said in a statement.

Several small business support and advocacy groups echoed the lawmakers’ remarks, as the National Association of the Self-Employed, the Small Business Majority and the International Franchise Association touted the move as evidence that the president recognizes small firm’s important role in the economic recovery. The IFA, for instance, expects Mills to use her elevated status to continue pushing for easier access to capital for entrepreneurs.

“Today’s announcement…serves as a stamp of approval for her diligent and proven work to improve small business access to credit during a still very-challenging economic and public policy environment,” IFA chief executive Steve Caldeira said in a statement. “Small business access to credit is the number one challenge facing prospective and existing franchisees and any steps that will enhance small business access to credit will help to boost our economy and create the jobs our country so desperately needs.”

However, both congressional committees and most small business groups aren’t ready to throw their support behind the larger proposal Obama laid out Friday. Should Congress grant him the authority, he plans to merge six federal entities with overlapping commerce and trade responsibilities into a single agency.

“I need to see the details of the [president’s] plan and review any plan put before Congress,” Landrieu said in a statement. “However I am open to streamlining the government, particularly if it will achieve savings and greater efficiency.”

Graves’s reaction was much the same, noting that he looked forward to examining the proposal further. “Decreasing the size of government and reducing bureaucracy is something that I support in principle, however, it is important that any effort to make significant changes to federal commerce and trade programs must be done carefully, and in a way that protects America’s small businesses,” he said.

While most small business groups said they too will wait to hear the details of the president’s plan before passing judgment, at least one organization has already voiced strong opposition. The American Small Business League said it was “vehemently opposed” to the restructuring plan, which the group says would “negatively impact millions of small businesses and reduce the power of the only federal agency that helps small businesses.”

The proposed merger would cut more than 1,000 government jobs while saving an estimated $3 billion over the next decade thanks to reduced paperwork and human resources costs. Obama said he would initially focus on the agencies that support business interests, but ultimately, he hopes to eliminate similar inefficiencies throughout the federal government.

Follow On Small Business and J.D. Harrison .

J.D. Harrison covers startups, small business and entrepreneurship, with a focus on public policy, and he runs the On Small Business blog.

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