Cato Institute Proposes Abolishing SBA Amid Record Small Business Funding
Cato Institute policy analyst Tad DeHaven has proposed abolishing two major US government departments. He suggests eliminating the Department of Education and the Small Business Administration (SBA). Meanwhile, the SBA is set to close Fiscal Year 2025 with record-breaking capital delivered to small businesses.
DeHaven argues that SBA lending programs disproportionately benefit participating lenders and a small subset of firms, rather than the broader small business community. He believes the SBA's budget expansion and corporate welfare are an unwise use of taxpayer money. In support of his stance, DeHaven points out that the majority of SBA's FY25 small business loans were approved under President Trump, with 58,000 loans totaling over $32 billion.
Heritage Foundation senior fellow David Burton shares DeHaven's concerns. He believes the primary purpose of the SBA should be to reduce regulatory impediments to small business growth, not providing taxpayer funds. According to an SBA press release, the agency guaranteed 84,400 small business loans totaling $44.8 billion in Fiscal Year 2025, indicating a significant increase in activity.
DeHaven's proposal to abolish the SBA comes amidst record-breaking capital delivery to small businesses. However, critics argue that the SBA's lending programs may not be effectively serving the interests of the broader small business community. The debate surrounding the SBA's role and funding is set to continue as the agency closes another successful fiscal year.
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