The SBA has a new leader, but she needs more power
By Frank Knapp Jr.
A month before he was sworn in as president, Joe Biden named Gina McCarthy, former EPA administrator in the Obama Administration, as his domestic climate czar. Her role is to work across multiple federal agencies to advance the Biden Administration’s climate policies.
Biden also named Roberta Jacobson, former ambassador to Mexico, as his border czar to manage his administration’s effort on border crossings and work on Central American policy during the first 100 days of his presidency.
Administration czars, who can be the heads of agencies or special appointments, temporary or more permanent, are the point persons responsible for pursuing multi-agency and private-sector solutions to serious problems. High-profile issues like climate and the Mexican-border require czar leadership.
In addition, however, another serious national concern needs a highly experienced female czar.
A slow-moving national economic crisis is crippling our local economies, especially in rural and underserved communities, and particularly among entrepreneurs of color and women. Politicians say that small business is the backbone of our economy. Well, that backbone is deteriorating.
In 2019, before the pandemic, U.S. Senators Tim Scott and Amy Klobuchar sponsored bipartisan legislation for research to explore why the nation is at a 40-year low in new business start-ups. Scott and Klobuchar recognized the crisis and co-sponsored the Enhancing Entrepreneurship for the 21st Century Act in the last Congress. A companion bill was introduced in the House, also with bipartisan sponsorship. Neither non-controversial bill advanced, but they have been refiled this year.
However, as we wait for possibly year-long research to be conducted, reports to be written, and congressional hearings to follow, we should remember that needed action in Washington often comes too slowly.
A czar has the power to get things done
Congress managed to act quickly to make Paycheck Protection Program loans (PPP) available to struggling small businesses. However, this program revealed what most of us within the small business community already knew: capital seldom gets to the entrepreneurs and very small businesses that need it the most. Minority- and women-owned small businesses felt the most impact of the pandemic. But they were largely locked out of the first round of the PPP loans, a reflection of an already existing problem.
Starting a small business is a gateway to financial success for entrepreneurs, their families and their communities. Yet, we starve our underserved entrepreneurial communities of the startup funding and professional training they need to achieve what we all say we want—economic growth in distressed communities.
And access to capital is not the only problem contributing to the small business startup crisis.
Issues like the cost of paid family/medical leave and retirement programs for employees also hold entrepreneurs back. Regulatory knowledge and regulations that favor big business are also factors.
These and other issues need addressed by Congress to promote entrepreneurship and small business growth. And that requires the need for a singular leader to work with all federal agencies and the private sector to make change happen sooner rather than later. We need a small business czar in the Biden Administration to coordinate a whole-of-government approach to remove barriers to entrepreneurship.
Fortunately, Biden named a highly successful woman, Isabella Guzman, as the new Administrator of the Small Business Administration. Now the SBA needs a bigger mission, more authority and the resources to enable Ms. Guzman to be the small business czar that we desperately need.