Office of Advocacy - US Small Business Administration—The State of Small Business

262 Pages·2002·0.94 MB·English

THE
STATE
OF
SMALL
BUSINESS
A REPORT
OF THE
PRESIDENT
1999–2000
Together with the Office of Advocacy’s Annual
Report on Small Business and Competition
United States Government Printing Office
Washington: 2001
ISSN: 0735–1437
ISBN: 0–16–0540940–8
Contents
THE STATE OF SMALLBUSINESS: AREPORT OF THE PRESIDENT 1
THE ANNUALREPORT ON SMALLBUSINESS AND COMPETITION* 5
Executive Summary 9
Chapter 1 The State of Small Business 17
Chapter 2 The Regulatory Flexibility Act: Changing the Culture of
Federal Agencies 39
Appendix A Supplementary Tables 55
Appendix B Procurement 117
THE ANNUALREPORT ON FEDERALPROCUREMENT PREFERENCE GOALS* 135
GLOSSARY 247
CONTENTS OF PREVIOUS EDITIONS 251
INDEX 257
*For detailed tables of contents of The Annual Report on Small Business and Competition,
and The Annual Report on Federal Procurement Preference Goals,see pages 13 and 135.
iii
THE
STATE
OF
SMALL
BUSINESS
A REPORT
OF THE
PRESIDENT

The State of Small Business:
A Report of the President
To the Congress of the United States:
This report documents the state of small business at the end of the 20th
century. Small businesses have always been the backbone of our
economy. They perennially account for most innovation and job cre-
ation, and not just when our economy is robust and growing. Small busi-
nesses have sustained the economy in weaker times as well, and put us back
on the track to long-term growth.
It is vital that we work together to give small businesses the climate
they need to thrive. Small businesses are disproportionately affected by
Government regulations and paperwork, and my Administration is commit-
ted to reducing this burden. We should regulate only where there is a real
need, fully justified through rigorous cost-benefit analysis and clear legal
authority. And when Government must regulate, it must adopt common
sense approaches. Regulations work best when agencies anticipate and ana-
lyze the effects their proposals will have on small firms. Rules need to reflect
the ability of the regulated to comply.
Another barrier to unleashing the full potential of small business is our
tax code. My Administration is committed to reducing taxes for all
Americans—and that includes small businesses. We must eliminate the
estate tax, which so often has impeded the orderly transfer of small busi-
nesses from one generation to the next, and too often has spelled the death
of the business after the death of its founder. Our tax code should encour-
age investment in small businesses, and particularly in new and growing
businesses. If we remember that the innovations that drive tomorrow’s econ-
omy come from entrepreneurial small businesses, we will help them to enter
the marketplace, not impede them before they get there. Above all, small
businesses need a tax code that is understandable and stable. Fairness, sim-
plicity, transparency, and accountability should be our goals, and my
Administration is committed to this end.
Small business embodies so much of what America is all about. Self-
reliance, hard work, innovation, the courage to take risks for future growth:
these are values that have served our Nation well since its very beginning.
They are values to be passed on from generation to generation. We must
ensure that our small businesses continue to thrive and prosper, not just for
their own sakes, but for all of us.
THE WHITE HOUSE
4 The State of Small Business
THE ANNUAL
REPORT ON
SMALL
BUSINESS
AND COMPETITION
U.S. SMALL BUSINESS
ADMINISTRATION
OFFICE OF ADVOCACY

Letter of Transmittal
Dear Mr. President:
The United States Small Business Administration herewith submits its Report
on Small Business and Competition in accordance with the Small Business
Economic Policy Act of 1980. The report was prepared by the Office of
Advocacy of the U.S. Small Business Administration. The report covers the
data years of 1998–1999, but was not sent by the previous administration in
a timely manner. Subsequent reports will again be submitted annually.
We are pleased to present this report and to work with you on behalf of
this important sector of the economy.
Respectfully submitted,
JOHN WHITMORE SUSAN M. WALTHALL
Acting Administrator Acting Chief Counsel for Advocacy