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Tuesday, October 04, 2005

So much for small businesses being the lifeblood of America
Posted by Jill | 6:44 AM

C-Plus Nero has given a lot of lip service to small businesses and an entrepreneurship culture, but when it comes to parceling out Federal dough for Gulf state reconstruction, only the Big Boys need apply:

Companies outside the three states most affected by Hurricane Katrina have received more than 90 percent of the money from prime federal contracts for recovery and reconstruction of the Gulf Coast, according to an analysis of available government data.

The analysis by The Washington Post takes into account only the first wave of federal contracts, those that had been entered in detail into government databases as of yesterday. Together they are valued at more than $2 billion. Congress has allocated more than $60 billion for the recovery effort, and the ultimate total is expected to rise far higher.

But already the trend toward out-of-state firms is clear, despite pledges by administration officials that federal funds for Katrina relief will become an engine of local economic redevelopment. Among the contracts analyzed, 3.8 percent of the money went to companies that listed an Alabama address, 2.8 percent to firms in Louisiana and just 1.8 percent went for Mississippi contractors. Taken together, that amounts to less than $200 million.

The lack of contracts for firms in the devastated area has angered local political and business leaders who say they fear that even with the massive commitment of federal money, the region's recovery will be stymied if funds primarily flow into the pockets of large, out-of-state corporations. It has also raised the ire of small-business advocates, who say the government has tilted the playing field against the companies that most desperately need the work.

"The large federal agencies know the large, national corporations -- people who have access. The smaller, local companies do not have that access," said Rep. Charles W. "Chip" Pickering Jr. (R-Miss.). "So the large corporate players are getting the contracts. And the small, local ones that need to put people back to work are at a disadvantage."


The only question is why people like "Chip" Pickering are surprised This Administration gives back only to those who have given to it. Small businesses in the Gulf states don't have enough money to buy access, so they get stiffed on reconstruction money. It's very simple. And it shouldn't surprise anyone.
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