The federal government has long been looking for ways to streamline its budget as a means of making things in Washington, D.C., and across the country, run more smoothly. However, one idea recently proposed by a well-known lawmaker has some experts very concerned about the ways in which it will end up affecting small businesses nationwide.
U.S. Sen. Richard Burr, a Republican representing North Carolina, recently introduced a bill that would effectively "consolidate" the U.S. Departments of Labor and Commerce into one new agency known as the U.S. Department of Commerce and the Workforce, according to a report from his office. The idea behind such a move is that it would effectively reduce costs by making sure redundant operations are minimized. The bill would also follow a previous recommendation, originally made by the Bowles-Simpson Commission, that would fold the U.S. Small Business Administration into the Department of Commerce as well, while moving the U.S. National Oceanic and Atmospheric Administration out from under the purview of Commerce, and over to the U.S. Department of the Interior.
"Duplicative programs cost the federal government staggering amounts of money every year," Sen. Burr said. "The president has proposed merging and consolidating federal agencies several times over his two terms, and this bill advances that proposal. Combining offices with similar functions within these two agencies is a common-sense approach that reduces wasteful spending and would streamline our approach to comprehensive economic policy."
Burr further says that such an effort would actually be beneficial in terms of promoting economic growth and protections for the entire country's workforce, the report said. He also says that the Government Accountability Office recommended these steps, saying they would eliminate wasteful and duplicative programs.
Some opposition to such a move
However, experts say that there could be significant problems if such a move is made, especially where the SBA is concerned, because of the ways in which it specifically acts to help promote the strength of small businesses nationwide, according to a report from the Washington Post. In recent months, the government entity has done significant work in terms of trying to broaden credit availability, along with training programs and other initiatives that many entrepreneurs nationwide have come to rely heavily upon.
"[The move would] close the only tiny agency in government to assist the 28 million small businesses that are responsible for over 90 percent of net new jobs in America," Lloyd Chapman, head of the American Small Business League, told the newspaper.
Other experts, though, say that such a move wouldn't necessarily lead to any changes at all, the report said. For instance Karen Kerrigan, president of the Small Business and Entrepreneurship Council, told the newspaper that if spending is reduced and policies are improved through consolidation, that could actually be a win for independent companies across the country. However, any speculation as to the effects such a change may have for private enterprise in the coming years is highly theoretical at this point, and in fact the legislation hasn't even gone before the U.S. Senate for a vote at this point. Many believe that the bill itself may be a non-starter at least until the mid-term elections, after which point the makeup of both the House and Senate could be significantly different.
Owners worried about such a change may want to make sure they're doing all they can to remain financially healthy no matter what happens in the future. That might include taking the time to examine small business insurance costs, including those for liability insurance, as a means of making sure they're spending as little as possible for the coverage they need. Doing so may help companies to save thousands of dollars per year.