According to the Small Business Administration (SBA): “The federal government’s goal is to award at least five percent of all federal contracting dollars to small disadvantaged businesses each year.”
Here are the benefits: “To help provide a level playing field for small businesses owned by socially and economically disadvantaged people or entities, the government limits competition for certain contracts to businesses that participate in the 8(a) Business Development program.
“Disadvantaged businesses in the 8(a) Program can: Compete for set-aside and sole-source contracts in the program. Form joint ventures with established businesses through the SBA’s mentor-protégé program. Receive management and technical assistance, including business training, counseling, market assistance, and high-level executive development programs, as they apply.”
Most successful program ever
The 8(a) program was the brainchild of Parren J. Mitchell while he was chair of the House Small Business Committee and his staff, led by NBCC Board Member Anthony W. Robinson. It is the most successful minority business program in the history of federal procurement. No formal program has made more Black millionaires than this program. Still, it must be updated and reinforced.
A five percent minority business goal for the federal government is a pittance. The Black population percentage of our nation is over 14.6 percent alone; Hispanics are 17 percent. That’s 31.6 percent without other ethnicities. Racism and passive discrimination in this nation still exists and per the U.S. Supreme Court and Title VI of the Civil Rights Act of 1964, discrimination must be addressed according to the disparate impact placed on identified groups.
Didn’t follow through
President Bill Clinton had the answer to this after being encouraged (or intimidated) from the 1996 Million Man March. His plan to “mend” affirmative action rather than “end” it included formal disparity studies for each of the 10 federal regions. Following that, adjusted goals could be implemented. One big problem – he never did it. The Congressional Black Caucus should wake up and take the lead from its greatest founder, Congressman Mitchell, and proceed with the above idea.
The great HUD Secretary Alphonso Jackson applied this logic and took Black procurement at HUD to new heights, approaching 32 percent. President George W. Bush watched his back as Democratic congressmen tried to have him indicted for whatever reason they could find. He eventually resigned to spend time protecting his name and future during various hearings and investigations. HUD does about four percent in Black procurement today.
The greatest challenge to the 8(a) program came ironically under the Barack Obama administration. This president had a mission to “repay” White construction unions for raising over $600 million in his first presidential campaign. His payback was to require federal construction contracting over $1 million to become union-only projects. As Blacks and Hispanics are terribly underutilized by construction unions, this would cripple the 8(a) program.
We went to the White House and pleaded on the effect this would have over our constituency (which should have been his, too). They ignored our efforts and quickly became adversarial. What happened was devastating. The Obama administration went “dark” over the 8(a) program.
Destroyed by Obama
Black procurement levels at the time George W. Bush left office were over 8 percent. When Obama finished his two terms, it had been reduced to a little over one percent. That’s billions of dollars extracted from our communities.
SBA Regional Administrator Ashley Bell spoke at our recent annual conference and emphasized the reduction in Black procurement due to the reduction in active Black 8(a) firms. The same can be said for SBA business loans. It was just devastating and most of the Black community does not know what hit them.
What was particularly “salt in the wounds” was that the SBA under the Obama administration became very hostile towards Black business. At one point, the SBA would reject our emails to them. They took their budgets for funding development grants away from Black associations and tossed them around to non-Black groups. There was pure hatred over there during those eight dark years. How could Blacks do this to other Blacks in the 21st Century?
Turn it around
Let’s turn this atrocity around. We must encourage the White House and federal agencies to quickly pick up the pieces and bring the 8(a) program back to life and with vigor and updated goals. If Black firms could attain at least five percent in procurement contracting with the federal government, that would mean $25 billion annually infused into our economic base.
There is a federal election coming in 2020. We must make significant improvement while that environment exists. It is time for Blacks to address each political candidate with that great quote from Chaka Khan: “What ‘cha gonna do for me?”