Karen Kerrigan’s bio in The Mandate for Leadership credits her with being “president and CEO of the Small Business & Entrepreneurship Council” and with conducting worldwide “training missions focused on entrepreneurial development, effective advocacy, policy formation, and implementation.” Furthermore, she “testifies regularly before Congress and has served on numerous federal advisory boards representing the interests of entrepreneurs and small businesses.”
Her chapter in The Mandate for Leadership concerns the Small Business Administration (SBA). In the chapter, she narrates the history of the administration, showing how its role has expanded over the years. She describes this as mission creep. She advocates for a “restructured
and reformed SBA” that “would end the long-term deficiencies, practices, and problems
that have prolonged the decades-long cycle of waste, fraud, and mismanagement” within the agency. She mentions “scathing Government Accountability Office (GAO) and Inspector General (IG) reports that have centered on mismanagement, lack of competent personnel and/or systems, and waste, fraud and abuse.” Given that the GAO and IGs have a reputation for being nonpartisan, one may give Kerrigan the benefit of the doubt regarding her claim that the SBA is in need of reform.
A check on the GAO’s website shows that indeed, there are 31 open recommendations. One may judge for oneself if they are scathing. Similarly, the Office of the Inspector General lists many reports on the workings of the SBA. For example, one report titled “Evaluation of COVID-19 Economic Injury Disaster Loan Applicants on the U.S. Department of the Treasury’s Do Not Pay List” has this to say:
“Despite implementing controls requiring loan officers to check DNP [Do Not Pay] databases prior to approval of COVID-19 EIDLs and provide applicants 30 days to rectify any negative information received from DNP, the agency continued to award and disburse COVID-19 EIDL and grant funds to those listed in a DNP database without mitigating the negative information. We recommended the agency review the 3,643 potential improper payments we identified and determine if applicants can rectify the negative information; if not, we recommend the agency work to recover the funds.”
A shorter version of that paragraph might read: “You were supposed to check to see if people asking you for loans were on the Do Not Pay list. Even though you checked, it seems that in 3,643 cases, you may have paid them anyway. You should make an effort to get that money back from everyone who can’t get their names taken off the list.”
It should be noted that this potential case of waste and mismanagement happened during the Trump administration’s famously botched response to the COVID pandemic. In other words, the SBA did not suddenly become less susceptible to problems when a conservative was in the White House. Indeed, quite the contrary. Trump notably said: “I’ll be the oversight” regarding the COVID loan programs. Then he fired people assigned to oversee the loan programs and prevent fraud. The result was, according to one estimate, $160 billion worth of fraud.
If Project 2025 comes to pass and career civil servants are replaced by the thousands with people whose essential qualification is ideological loyalty—not a history of integrity, competence, or honesty–one can expect similar results across all areas of government.
