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Eliminate the SBA?

Date: 05/24/2006 | Category: Business | Author: developers

There is a long standing debate regarding the usefulness of the SBA. Another recent article in the Fortune Small Business Magazine raises several interesting points. For example, is it worth keeping an agency where its loan programs reach less than 1% of U.S. small businesses? On the other, in fiscal year 2005 the SBA made or guaranteed $19 billion in loans for small businesses…the most in its history. That may have represented the difference between failure and success for several small businesses.

Would it be better to close the SBA and free up its half-billion-dollar annual operating budget for programs that would truly help small businesses such as a targeted rebate on FICA taxes, one of the heaviest burdens on small business today–15.3%? Or, do the positive aspects of some of their programs such as the diaster-loan program (though failed miserably in LA, still has merits) and itstraining and microfinance programs outweight its failures?