An agency's new chief gets down to business - Erskine Bowles; Small Business Administration - includes biographical and family information and his fundraising efforts for diabetes research - Cover Story

0 Comments | Insight on the News, Nov 1, 1993 | by Betsy Pisik

But critics say the SBA is spread too thin and that it wastes resources on issues that don't have anything to do with helping small-business owners. While it's nice to hand something over to different interest groups, I guess I think there would be more progress for all of small business if there was a more concentrated product from the SBA," says John Paul Galles, executive vice president of the moderate National Small Business United. "There are a multitude of programs there without a lot of funding for them."

This is old news to most people. "Frankly, once you get a program in place in the SBA, it picks up its own advocates and constituency," says Rep. Jan Meyers of Kansas, the ranking Republican on the House Small Business Committee. "If it's serving people and, for the most part serving them fairly well, it becomes difficult to withdraw that program."

More troubling to SBA officials are the frequent accusations that the agency functions as a petty cash drawer for Congress. Forty-three members of Congress sit on the House and Senate small business committees. Resisting them can be difficult. The end result: SBA's reputation for pork-laden projects.

The much-maligned $16 million tree planting program is a prominent example. Started under Bush, the program has been targeted by the House Appropriations Committee for years because "tree planting is not one of small business's priorities," according to an appropriations bill. Rep. Neal Smith, an Iowa Democrat, wrestled the tree planting program into the SBA from the Department of Agriculture. Smith, a member of the Appropriations Committee and a former member of the Small Business Committee, vigorously defends the tree planting program as both cost-effective and beneficial to nurseries around the country - most of which are small businesses. He also defends the Small Business Development Centers, which he helped start. "If you think they're pure pork," Smith says, "then you think everything the government does that private business can't do is pure pork."

Vice President Al Gore's much-anticipated plan for "reinventing" a leaner, more results-oriented government for the most part left the SBA alone. Some observers were surprised to see the organization get off so lightly.

"How many programs are there at the SBA that are duplicated in other agencies?" asks Susan Eckerly, deputy director of economic policy studies at the conservative Heritage Foundation in Washington. "If there is this crying need to help small business - which I doubt - let's combine them."

She cites small- and minority business programs at the departments of Commerce, Agriculture, and Housing and Urban Development that, she believes, could be folded in easily with the SBA's efforts. Eckerly says she would like to see the entire SBA budget pay for growth incentives that would help small business more than the SBA can.

Bowles bristles at these complaints. He points for example to this year's $175 million emergency appropriation to guarantee loans, which he says will generate $3.2 billion in loans that will create or maintain 300,000 jobs over the next four years. This economic activity in turn will generate $600 million in new tax revenue. "I think that's a good return on your investment in anybody's book," he says.