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April 8, 2024 - RFK Jr. The Defender

28:17

Corporate Capture Kills Small Business with Lloyd Chapman

Lloyd Chapman and Robert F. Kennedy Jr. discuss how corporate greed, lobbyists, and the captured government agencies, are destroying small businesses. Lloyd Chapman is on a mission to stop the diversion of federal small business contracts to large corporations. He founded of the Small Business League in 2004.

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	I'm really happy to have here today a guest who's one of the great champions of small business in the United States.
	For over 30 years, Lloyd Chapman has worked to protect the interests of our nation's 27 million small businesses.
	In 2004, Mr.
	Chapman founded the American Small Business League.
	With the goal of stopping the diversion of federal small business contracts to large corporations.
	So let's start with basics.
	How important are small business to the US economy and to employment?
	Good question.
	Let's see here.
	Citrus Bureau data, 99% of all U.S. companies have less than five employees, 98% have less than 100, and 87% of all U.S. firms have less than 20, and the average American company has 10 employees.
	No small business responsible for over half the gross domestic product, half the private sector workforce, over 90% of US exports, and most importantly, about 98% of all net new jobs.
	So most Americans work in small businesses.
	And I think America, quite frankly, is a small business economy, because that's where all the jobs come from.
	Yeah.
	How worried are you about AI? Terrified.
	Well, in regard to the government using it against small businesses, is that what you're saying?
	Well, the whole thing, I mean, just about displacing accounting firms, law firms, you know, there's so many things that it can do.
	Do you think it's a bigger threat to bigger, big corporations or small corporations?
	I'm worried also clearly about the surveillance and the control and the compliance aspects of it.
	And just the ability to, you know, that we have a government that's lying to us about everything.
	Absolutely.
	With AI, it's going to amplify its capacity to just distort reality in order to achieve whatever nefarious ends, you know, people want to achieve.
	So I share your terror about that, but I'm also just worried about, you know, I'm worried about Driverless cars, self-driving cars, that must be a huge percentage.
	I saw a guy on TV talking about the fact that all the roadside businesses in America are going to go away because he says all those trucks are up there for trucks and we're going to have driverless trucks.
	And so all these roadside businesses all across the country are going to go away.
	So yeah, that's something that's very concerning.
	Yeah, okay.
	Well, let's talk about it.
	I know one of your concerns is the bias that federal government has toward big business and against Main Street.
	Let's talk about that.
	All right.
	Well, federal law, the Small Business Act passed in 1953, mandates that a minimum of 23% of all federal contracts go to small businesses, and then a subset of 5% to women, and I think it's 13% to minorities and 5% to service-enabled veterans.
	And what most Americans don't know, the Small Business Act is the largest economic stimulus program ever passed by Congress for the American people.
	And I would say it's largely unknown.
	That law has been largely repealed by the Pentagon over the last 20 years.
	They bury language in the National Defense Authorization Act.
	It erodes that.
	The budget for the Small Business Administration was bigger when Reagan was president than it is today.
	There's been a nonstop effort For 30 years to close the Small Business Administration and end all federal programs for small businesses.
	And again, here in America, 98% of all the net new jobs come from small businesses.
	And most of the innovation comes from small businesses.
	And there's just a very aggressive campaign in Washington to end all federal small business programs.
	Here's a statistic that might surprise people.
	So only 1% of businesses in America have over 500 employees.
	I think I'm going to go.
	With this tiny sliver of 1% that don't create jobs and don't pay taxes, I think that's a recipe for economic suicide.
	I'm very concerned about that.
	And those are like Fortune 500 companies, right?
	Yeah.
	In fact, I'll show you something funny.
	So you and I both sued the government before, right?
	So here's the Pentagon tells Congress they're doing a great job of small businesses.
	And so I said, can you show me some of the firms that you're giving contracts to?
	They said, no.
	So I sued them, and this is what I got.
	You've seen this before, haven't you?
	Right?
	That's called redacted.
	Exactly.
	I spent seven years in court to get this, and $900,000, right?
	Yeah.
	When the government says we're doing a great job of small business, say, let me see, this is what they give you.
	Let me ask you, because the Pentagon only wants to deal with Boeing, Lockheed, General Dynette, Northrop Grumman, and it doesn't want to deal with any small business.
	But is that rational by the Pentagon?
	No.
	No, I'll tell you something.
	My father was a contractor for the Air Force.
	That's how I really kind of got into this.
	And if someone's working for the government in procurement, they want to work with big companies because when they retire, they can get a job with those big companies and it's called double dipping.
	So they retire from the Pentagon after 20 years and go to work for some defense contract and work there for 20 years.
	So they're not going to get jobs with small businesses.
	A lot of people in government will try to say, oh, small businesses are too small.
	That's not true.
	I saw a statistic from a company that analyzed federal procurement data called FedMind, and I think 50% of all individual purchase orders from the government are $50,000 and less.
	So any notion that small businesses can't handle the business is untrue.
	The federal government is, I would say, aggressively anti-small business.
	In fact, let's just say this.
	So again, Census Bureau data, 98% of all U.S. companies have less than 100 employees.
	I challenge anybody to show me one piece of legislation ever to address those companies.
	You know, those companies are the heart of the national economy, and yet you won't see one piece of legislation that's ever been passed to help the small businesses where most Americans work, where most of the GDP comes from, and most of the tax revenue, and all the jobs.
	You won't see it.
	So it's concerning.
	What should the government be doing to help small business?
	Well, you know, I think you and I both have seen enough stories about Fortune 500 firms not paying taxes.
	When they're not paying the taxes, that tax burden is shifted to the middle class, right?
	And that means small businesses are having to pick up the load that the Fortune 500 firms are paying.
	If it were me...
	The first thing I'd do is make sure they're complying with the Small Business Act of 1953 and make sure the small business are getting a minimum of 23%.
	I would raise that to like 35% since, you know, small businesses are half the GDP, right?
	And 90% of the net new jobs were trying to create jobs.
	So I would make sure that that law is being complied with.
	The Pentagon has gotten hundreds of loopholes passed in the National Defense Authorization Act over the last 30 years that just keep willing away at that, you know, making it harder and harder for small businesses.
	Just recently, there were some sweeping changes in the 2024 NDA that are, again, chipping away at the small business program's So I would make sure that laws passed.
	One thing that I think that women should be concerned about is women are half the population.
	They own 43% of the business in America.
	And for the last 50 years, 95% of all federal spending has gone to companies owned by men.
	And that's why men are responsible for over 70% of all the political contributions.
	Men hold all the key positions of government.
	So to me, Men, you know, pretty much control the government.
	And I'd like to see more women in Congress, personally.
	One thing I'd like to see happen is for women to get a more proportionate share of federal contracts.
	So I think giving 95% to firms owned by men is a little lopsided.
	I would do something, I'd pass legislation and policy to give women at least 25%.
	And women are getting 5% now.
	If we got that up to 25%, That would infuse at least $200 billion a year in existing federal infrastructure spending into women-owned businesses and middle class.
	It would create millions of jobs and boost the economy dramatically.
	So I think that's something that needs to be looked at.
	But yeah, the government's anti-small business.
	It's been that way since Reagan.
	And I'll have to say this.
	The Republican administrations have been very aggressive to try to close the small business administration and end all programs for small businesses.
	Bush cut the SBA budget and staffing in half.
	So the SBA budget was bigger when Ronald Reagan was elected than it is today in 2024.
	It's the only federal agency, I think, in government whose budget is smaller now than it was 30 years ago.
	And that needs to change.
	That's interesting to me because Republicans, at least the Republican Party I grew up with, was very pro-Main Street, at least in its ideology and its rhetoric.
	I guess one of their ideological impulses is just to get rid of all government assistance, and I suppose that's what motivates the hostility of the Small Business Administration.
	You know, the way I look at it, and again, I've been suing them for 35 years.
	Fortune 500 firms want every penny the government spends to go to them.
	So the Small Business Act mandates that a minimum of 23% go to small businesses.
	They're trying to close the SBA and end those programs because they want that money.
	It's just greed.
	Again, if Republicans are so pro small business, please show me one piece of legislation passed by a Republican president.
	That would benefit companies with 100 employees or less.
	You can't do it.
	Just the opposite.
	So Reagan tried to close the SBA. Bush Jr.
	tried to close the SBA. Even Obama tried to close the SBA. I was shocked at that.
	Reagan's plan back in 1985 to close the SBA was combined with the Commerce Department.
	So the Commerce Department reps the largest business in the country.
	The SBA represents the small businesses.
	And the complete different interest.
	Again, that was Reagan's plan to close it.
	And Obama tried to do something.
	I was very disappointed about that.
	So President Obama tried to close the SBA by combining the Department of Commerce.
	You probably know this.
	A trick in Washington, if you want to close an agency and it wouldn't be popular with the American people, you combine it with another agency and then zero out the budget.
	So it never is reported that that agency has been closed, but they've done that.
	But that's what they would do with the SBA. They want to essentially close it by cutting the budget and staffing and combined with another agency.
	And when they combined with another agency, you can't tell anymore, right?
	You can't tell what it is, right?
	But the staffing and the budget for the SBA when Reagan was president was, I would say, three times larger than it is in 2024.
	So the S&P budget should be, I don't know, three, four billion?
	It's less than a billion dollars.
	So when you think about it, so we've got a country where 33 million small businesses are responsible for 98% of the net new jobs, half the gross domestic product, half the private sector workforce, over 90% of U.S. exports, and there's this little tiny agency that represent them, and they're trying to get rid of that?
	I think that's someone's not thinking right.
	But it's what you have talked about, corporate capture.
	Those big corporations have so much power in Washington, and they want that money.
	They want 100% of the money the government spends.
	And that's why they're so aggressive to get rid of the Small Business Administration.
	Again, I think most Americans would be shocked to find out that 97% of their tax dollars are being spent with 1% of the companies in this country.
	And those companies have not created one job since 1980, and many are paying no taxes.
	I just think that's just insane, right?
	But Bush closed most of the regional SBA offices.
	He cut the staff in half.
	I think all the regional offices need to be reopened and the SBA budget needs to be restored to some reasonable level so they can help small businesses and create jobs.
	And then how do you get your funding and what is your background?
	My background was, quite frankly, I was a real estate agent.
	And a friend of mine started a computer company around 1985, and I came out to help her just for fun, right?
	Are you from Texas?
	I'm from Round Rock, Texas, which is just outside of Austin.
	Just trying to place your accent.
	Yeah, my accent can get pretty heavy sometimes.
	But yeah, I'm from Round Rock, Texas.
	And I went to California just really on a vacation to help this friend of mine.
	I got involved in it.
	And again, my father was a contracting officer for McClellan Air Force Base in Sacramento.
	And he gave me all this information to try to help this friend of mine.
	And he told me how to do freedom of information requests.
	I was naive.
	I didn't do anything.
	And so I did my first freedom of information request.
	And they didn't like it.
	I just fell into it.
	I was asking for these reports that the Pentagon had on how much money the defense contractors were actually giving to small businesses.
	So the Pentagon was telling Congress that they were giving small businesses the 20% at that time of law mandated.
	I wanted to see these reports, and when I got a few of them, I saw that the small business goals were in tenths of a percent.
	So while the Pentagon was telling Congress they were giving 20%, the contracts I saw were like 1,600 to 1%, you know, two-tenths percent, 1%.
	In fact, here's how I really got started doing this.
	Again, I just didn't know anything about it.
	And I saw on television that Lockheed got a big defense contract.
	And so I did a Freedom of Information request for a copy of the small business subcontracting plan for that contract.
	And again, my father was telling me what to do.
	I got the paper, and the small business goal was 16, 101%.
	Well, at that time, the law said 20.
	I thought it was a typo.
	And so I called them, and they said, no, that's what it was.
	So I called Barbara Boxer, and she put me in touch with Les Aspen.
	Remember that guy?
	Oh, yeah, I knew him very well.
	Yeah, yeah.
	He was a great guy.
	Yeah, there was a congressional investigation into this contract, and they boosted the funds for small businesses from $16 million to $517 million.
	And that was like maybe five or six phone calls.
	And I thought, well, hey, this is easy.
	So I requested information on a couple more contracts, and that's when they decided it was top secret.
	And I sued them.
	I lost at the district court level to a judge whose brother was a high-ranking Pentagon official, Judge Rukazan.
	And then I appealed to the Ninth Circuit, and I won that case.
	And the judges were so angry with the government's attorney, this poor woman, she was probably about 35 or 40, they were just screaming at her, and she was crying, you know, in court.
	They were so angry.
	And I won that, and I won basically the release of all these reports that showed that they were, you know, not hitting the goal.
	So what the Pentagon did was pass a program called the Comprehensive Subcontracting Plan Test Program that eliminated reports that I'd won the right to see.
	Yeah, you're familiar with that.
	Yeah, you've seen that, right?
	So the comprehensive subcontracting plan test program was passed to see if it would increase contracts to small businesses.
	There were two provisions.
	Number one, no penalties from uncompliance and no transparency.
	Sound familiar?
	Yeah.
	Yeah, here's the funny thing.
	How long do you think they've tested if limited transparency and any penalties for non-compliance is going to help small businesses?
	I think they tested it for 35 years.
	And they're still testing it.
	So the Pentagon is still testing whether limiting transparency and any penalties for non-compliance is going to help small businesses.
	That's just insane.
	That's gone on for 35 years.
	Yeah, well, it's been a very successful program for the Pentagon and for big business.
	Absolutely.
	I had a meeting one time at the Inspector General at the SBA. From my experience of winning that case in the Ninth Circuit, I prompted a congressional investigation into fraud and abuse in federal small business programs during the Bush administration.
	And I was meeting with the head of the SBA, Inspector General.
	And it went to a nice meeting.
	And at that time, I was suing the SBA under the Freedom of Information Act for the phone records of the press office director, who I assumed was working with the Pentagon.
	So as I left my meeting with the Inspector General, I got in the elevator, and I saw the sign that says, SBA press office.
	I jumped out of the elevator.
	He said, go over and say hi to this guy and kind of harass him.
	And there was a stainless steel door with a bulletproof glass and a keypad.
	So I just walked out of the executive offices of the SBA. I could see the SBA administrator's office.
	When I walked in this door, there was a secretary, and I could see the SBA administrator's office.
	The inspector general's office was down in the hall and their chief counsel.
	But when I tried to go to the press office, it was the stainless steel door.
	My personal opinion is the Pentagon runs the SBA out of that office.
	And back a few years ago, I was always dealing with the SBA press office.
	I was always fighting with them in the press, right?
	And the guy who was head of the SBA press office was a retired naval commander whose specialty was surface weapons warfare systems and reputation management.
	I find that to be a little suspicious, right?
	In fact, right now, It's like 30 Rock, you know, where Alec Baldwin played the director of television programming and microwave ovens.
	The General Electric Company.
	It's just...
	Yeah.
	It's a populist designation that really doesn't make any sense.
	You know what?
	I'll tell you something.
	I was thinking about this.
	From suing the government, it's put me in contact with a lot of people in different areas.
	And I prompted a congressional investigation.
	I tested it for Congress.
	I wrote legislation to try to change it.
	And nothing in government is the way it should be.
	So what's happening at the SBA, where small businesses are being cheated out of, I would say, about $300 billion a year.
	So they're supposed to get 23%.
	I think they're getting 3%.
	And that's typical.
	So every agency is like that.
	You talk about corporate capture, right?
	Every agency is just like that.
	So the SB is just a little sample of every agency is just like that.
	So an agency that was designed to help small businesses is actually being run by people that are trying to help the Pentagon, not the small businesses.
	But from what I've seen, I've been in Washington quite a bit.
	I've been in every office in the House and the Senate.
	I've met most of the presidents in my lifetime.
	And that's the way the whole town runs.
	You know, so Washington is run not for the American people, but Washington, D.C. is run for Fortune 500 firms.
	In fact, here's something I want to be sure to talk to you about that I think you probably know about.
	In the last four or five months, I've discovered that the DNC is completely run by corporate lobbyists.
	I never knew that.
	I'm 74.
	I didn't know that.
	If you search on DNC corporate lobbyists, you'll see a multitude of stories that talk about, from the top to the bottom, it's corporate lobbyists, and the RNC, I think, is very similar.
	I didn't know that.
	My favorite one is people can search on top DNC committee packed with corporate lobbyists.
	So the DNC is not what I think people think it is.
	That's the political party that, in my view, that represents Fortune 500 firms, not the American people.
	You probably agree with that, don't you?
	Yeah, absolutely.
	I mean, I see it every day.
	The New York Times reported this week that the DNC has already raised $1.1 billion for this election and that they're on track to raise $3 billion.
	You know, they're using that money to Make sure nobody else gets on the ballot.
	So the Democratic Party, when I was a kid, was about voting rights.
	It was trying to make sure that every American could vote no matter what.
	And now the DNC, controlled by corporate lobbyists, intends to subvert democracy, to make sure that people can't vote, disenfranchise anybody.
	And they're doing the same thing to Trump.
	I'm not a fan of Trump's, but But they're trying to get them off the ballot in the courts.
	That's not right.
	This is a banana republics, you know, and trying to weaponize that, you know, they're weaponizing the Secret Service against me.
	They're using the agencies to, you know, to make sure I have to pay more money, to make sure all of this stuff is nothing about democracy anymore.
	It's all about promoting the interests of those big companies.
	Absolutely.
	By the way, it's not just the DNC and RNC that are run by them.
	It's the government, you know, when they...
	Absolutely.
	I've been there.
	In the congressional here that I prompted, Fortune 5 firms could testify.
	I've won about 110...
	Legal victories against the government, mainly under the Freedom of Information Act, right?
	I've been on every TV network in the country talking about this for, you know, 20 years.
	And when they had a hearing about small business and the Pentagon, they didn't invite me to testify.
	They invited someone from Boeing to come testify.
	So in the House Small Business Committee, a hearing about small business contracting in the Pentagon, they didn't invite me.
	They invited Boeing.
	Yeah.
	The whole government is corrupt.
	I thought about this driving over here.
	I sincerely believe the United States government has terminal cancer, and the cancer is corporate capture, and they've captured every area of government.
	There's no area of government that you can look at that's not Yeah.
	500 firms.
	I'm terrified, quite frankly.
	I think that something really bad's going to happen.
	I think our whole economy is going to collapse.
	If we're giving 97% of all the tax dollars to this 1% of companies that don't create jobs, don't pay taxes, that sounds like a real bad idea to me, right?
	Yeah.
	And shifting all the trillions of dollars upward to create this new oligarchy of You know, somebody asked me the other day, one of the mainstream press reporters who was angry at me because she said that I was, you know, telling everybody the government was corrupt and now I'm trying to run the government.
	How am I going to run it if it's all corrupt?
	I said, I'm going to make it tell the truth.
	That's how I'm going to make it.
	She was saying, you know, you're making everybody mistrust the government.
	You should.
	If you trust the government, you're not paying attention, let me put it that way.
	Absolutely.
	If you trust the government, you're not paying attention to what you're talking about, right?
	Here's the government right here.
	He's showing me like a big sheaf of pages that are just solid black because they're all redacted.
	Every name of the small businesses that the Pentagon helped.
	He sent a Freedom Information request saying, what small business have you helped?
	And they sent them like 50 pages back that are all black.
	Exactly.
	Exactly.
	You know, you probably know Public Citizen, right?
	Yeah, yeah.
	Public Citizen, yeah.
	Here's a report they put out called Slided, and here's what it says at the bottom.
	Accounting tricks break false impression that small businesses are getting their share of federal procurement money and the political factors that might be at play.
	That's Public Citizen, right?
	Mother Jones did an article with me a few years ago called Corporate Giants Reaping Billions in Federal Small Business Contracts.
	Yeah, the government's just...
	I can't think of any area of government that's running the way it should be.
	Everything's wrong.
	It's scary.
	The Pentagon hasn't passed an audit in like 40 years.
	Here's something I want your listeners and viewers to do for me.
	Go to your computer and type in 35 billion missing Pentagon and see what pops up.
	There's a story that I think Yahoo did it.
	Apparently, 35 trillion.
	Did I say billion?
	Trillion.
	$35 trillion.
	They're not exactly sure where it is at the Pentagon.
	So type in 35 trillion missing Pentagon and see what pops up.
	Can you imagine that?
	Trillions!
	Trillions!
	Where is it?
	You have it?
	Where'd it go?
	I can't find it, right?
	35 trillion!
	You know, one of the 9-11 conspiracy theories is about the Pentagon audit.
	I know that story.
	All right, why don't you tell it?
	Well, they hit the part of the Pentagon where all the records were, right?
	That's right.
	So the day before 9-11, Donald Russell gave a speech and said the biggest threat, I think, to national security was not some far-flung dictatorship.
	It wasn't Russia.
	It wasn't China.
	It was the Pentagon bureaucracy.
	And he said, we can't track $2.3 trillion in acquisitions.
	And then the next day, something, in my opinion, not an airplane, hit the part of the Pentagon where they're doing the audit.
	And yeah, you and I, after suing the government, you know how bad it is when you sue them, right?
	When you sue the government, forget about the Star Spangled Banner and the Pledge of Allegiance.
	It's like suing the mafia.
	They don't play fair.
	They don't like it when you see them and try to expose corruption and fraud, right?
	Yeah, anyway, I think the solutions are very simple.
	They're very simple.
	Comply with the 1953 Small Business Act.
	Give small business the 23% the law has mandated they get.
	They create all the jobs.
	Let's create some jobs.
	It will create more tax revenue.
	To tell you the truth, I think compliance with the Small Business Act would address the homeless problem.
	I really do.
	So the middle class economy is imploding.
	I believe one of the reasons is, I think you probably agree with this, one of the reasons the middle class economy is imploding is all of the government spending is going to this tiny 1% that doesn't create jobs.
	And I believe that if they would comply with the Small Business Act and give small businesses at least 23%, they would create millions of jobs.
	In fact, I'll tell you something.
	The Senate Small Business Committee did a study about 10 years ago that said for every 1% that contracts a small business went up and create 100,000 new jobs a year.
	That's the Senate Small Business Committee, right?
	All the research, all the experts I've talked to, all the lawsuits I've won, small businesses are getting 3%.
	So if we give small businesses 23%, that's 20% more, right?
	And according to the Senate Small Business Committee, that's 2 million new jobs a year.
	The government's only claiming to be creating 2.5 million jobs, which I think is completely fabricated.
	But think about free and easy, no new taxes, deficit neutral, creating 2 million net new jobs a year by just complying with a law that Eisenhower signed.
	I think that's a no-brainer.
	We need to do that.
	Well, Lloyd Chapman, thank you so much for enlightening us.
	Thank you for fighting for the American middle class, for the American small business.
	And when I get into the White House, I'm going to call you up on day one, and we're going to do all that you want to do.
	So thank you.
	Yeah, thank you.
	Let's do something for women, get them their fair share of government contracts so they can have the political power to get more women elected to Congress.
	Yeah, I like that.
	I love that.
	My wife's going to like that, and my vice president is going to like that a lot, too.
	By the way, congratulations on picking her.
	She is brilliant.
	She's knowledgeable.
	He's got the right motivation.
	She's so much of character.
	What a beautiful, perfect choice.
	Thank you so much.
	She's a lovely person.
	I just, I love her.
	She's amazing.
	She's brilliant.
	You know, being brilliant is helpful.
	We need some brilliant people in government, right?
	I don't get it.
	That's what I said.
	Yeah, yeah.
	Let's get some knowledgeable, you know, Joe Biden gave people telegrams.
	Joe Biden gave people telegrams, and she's writing AI programs.
	All right?
	We need her.
	We need her desperately.
	Lloyd, a real pleasure to talk to you, my friend.
	Thank you, buddy.

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