SBA Gets Criticized — And Responds
The U.S. Small Business Administration was the subject of a critical piece recently in the New York Times.
The article criticizes the SBA on a number of fronts including claims that it places greater focus on disaster recovery assistance than on small business concerns; is making fewer SBA loans; and is not enforcing small-business and minority goals for Federal contracting
The SBA went to the extraordinary step of responding with a Letter to the Editor, and including several backup materials, including this detailed myth vs fact document.
The response refutes numerous points in the NYTimes article, basically saying the SBA was more efficient, even if fewer loans were being made. For instance, the time to process loans and honor loan guarantees has dropped dramatically, from months to weeks.
What amazes me are the claims that the SBA is not spending enough. Whenever you talk about a Federal agency not spending enough, it assumes that government programs are always a good thing.
Don’t get me wrong — I happen to think the SBA is a fabulous agency and does much good.
But often people gloss over what an SBA loan is, making it sound like it’s almost automatic to get one. And that if the SBA is not spending and making loans, they’re doing something terrible. In reality, SBA loans are not right for every business. Sure, lenders love them and push them, because the SBA guarantee lessens their risk. But there are easier and more targeted ways to finance a business
