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Big Government and Affirmative Action: The Scandalous History of the Small Business Administration Hardcover – August 3, 2001

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Bean is an associate history professor at Southern Illinois University and author of Beyond the Broker State: A History of the Federal Government's Politics towards Small Business, 1936-1961 (1996). He now continues to look at the role government plays in small business with this critical history of the Small Business Administration, which was established in 1953 as a "tiny lending agency." Bean's overriding theme is the contradictory nature of the SBA. Supposedly established to advocate for small-business owners and free enterprise, the agency's biggest support comes from Congress and it is frequently the target of critics of big government. Bean highlights the "corruption, fraud, and incompetence [that has] marred its minority enterprise programs," but he focuses on the "affirmative action" role of the SBA--first as it favored small companies over large ones and later, beginning with the Nixon administration, as it targeted loans to black-owned businesses. Nearly a third of Bean's book is devoted to notes and an extensive bibliography. David Rouse
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Review

"Bean is a master of administrative history, not just of the SBA but of the tremendous expansion of American government, especially beginning with and then flowing from the New Deal."―American Historical Review

"[Bean] has a love/hate relationship with the SBA, and this tension is visible throughout his meticulously researched monograph."―Business History

"Claims that the SBA did not help truly disadvantaged businesses but its affirmative action programmes benefited politicians in both parties who used it for their own gains."―International Review of Administrative Sciences

"His careful analysis, his all-encompassing bibliography, and his inclusive endnotes make this the definitive monograph."―Journal of American History

"The first full-length academic assessment of the agency. At once a powerful argument for killing off the agency and a shrewd analysis for the political impulses that make its termination nearly impossible."―Wall Street Journal

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Product Details

  • Hardcover: 240 pages
  • Publisher: University Press of Kentucky (August 3, 2001)
  • Language: English
  • ISBN-10: 0813121876
  • ISBN-13: 978-0813121871
  • Product Dimensions: 6 x 0.7 x 9 inches
  • Shipping Weight: 1 pounds (View shipping rates and policies)
  • Average Customer Review: 5.0 out of 5 stars  See all reviews (3 customer reviews)
  • Amazon Best Sellers Rank: #3,344,976 in Books (See Top 100 in Books)

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Format: Hardcover
"In "Big Government and Affirmative Action," Jonathan J. Bean tells the story of the role of small business in the growth of the American state. This compact account is a fine sequel to the author's award winning "Beyond the Broker State: A History of the Federal Government's Policies Toward Small Business, 1936-61" (Chapel Hill: University of North Carolina Press, 1996). It describes the process by which interest-group actors (business groups, congressional committee, and bureaucrats) operate to build nearly indestructible government programs. In addition, the book adds an important dimension to the story of the development of affirmative action. In manifold ways, congressional and bureaucratic policy toward "disadvantaged" businesses adumbrated later policy toward disadvantaged minorities and myriad of other victim groups, and the Small Business Administration (SBA) itself took up minority preferences as its raison d'etre."
Jonathan Bean pulls no punches in this nonpartisan look at an agency notorious for corruption. Republicans, he explains, have supported the Small Business Administration to deflect criticism that they are beholden to "big" business, whereas Democrats have supported it to show that they are not "anti-business."
"Bean has done a model job in producing a smoothly written and often amusing policy history, and the University Press of Kentucky has done excellent work in editing and publishing it."
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The author Jonathan Bean provides an excellent look into the history of the Small Business Administration and how the SBA transformed from a temporary government program established after the abolition of the Reconstruction finance Corporation into a massive bureaucracy promoting affirmative action through credit to "small business" in the inner city. Beginning with President Eisenhower, the administration used the SBA for patronage for Republicans and establish the image that the president was promoting small industry which demonstrated the programs usefulness to congressional leaders who were opposed to ending the agency which marked the transformation from a temporary agency into needed asset to government.

Real changes occurred in the 1960's when the race riots began to break out throughout the country. Many politicians believed that the riots were the result of the disadvantaged inner city minority populations who were unable to access credit to build their own businesses. As a response, many civil rights leaders and politicians backed efforts for affirmative action in lending in the SBA to offset the anger portrayed in the city riots. This also began Nixon's campaign of "black capitalism" advocated in the late sixties/early seventies where they were going to use the SBA to establish quotas through lending to minority businesses. Although racial preferences were established in the 1960's in what was supposed to be a colorblind agency, the policies of the 1970's officially ended the colorblind practice and helped establish affirmative action within government.
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May not be what the SBA leadership wants folks in the general public to know but, even as a former long-time employee, I found it highly instructive as to why this small agency could evolve into the dysfunctional organization it is today that motivated politicians know how to manipulate almost at will.
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