While efforts to reduce government spending have been prominent in Washington, a recent article by Gene Marks suggesting the elimination of the U.S. Small Business Administration missed the point by labeling the SBA as an ineffective venture.

Proposals to dissolve the SBA in the name of cost savings or efficiency not only lack direction but also endanger the countless entrepreneurs who benefit from its initiatives.

Small startups are typically initiated by individuals with unique concepts but lacking the financial means or business acumen to maneuver the complexities of running a business. The SBA steps in to bridge this gap by providing crucial aid through its loan programs, Small Business Development Centers, and procurement support. Without these resources, many aspiring entrepreneurs would encounter difficulties in acquiring funding, securing government contracts, or recovering from economic crises and natural calamities. The SBA was specifically established to address this prevailing market failure.

The SBA’s loan programs, such as the popular 7(a) and 504 loans, have enabled numerous entrepreneurs to obtain financing when traditional banks deem it too risky. Annually, the agency assists with billions of dollars in small-business loans, driving job creation and innovation. Critics argue that private lenders and investors can fulfill this role, but history demonstrates otherwise. Without the SBA’s backing, numerous small businesses, including those operated by veterans, would face challenges in obtaining much-needed funding.

In addition to lending, the SBA plays a vital role in federal procurement. Small enterprises received over $180 billion in government contracts last year, primarily due to the SBA’s advocacy and supervision. Terminating the agency would concentrate power further in the hands of larger corporations, making it even more challenging for small ventures to compete.

The SBA has proved invaluable during crises, responding swiftly and specifically to disasters like hurricanes, wildfires, or economic recessions, as experienced during the COVID-19 pandemic. The agency offers immediate, targeted assistance to keep small businesses afloat, particularly crucial in rural or smaller communities where communication barriers or limited resources might hinder business owners in obtaining deserved assistance. Omitting this safety net would render entrepreneurs more susceptible and jeopardize the financial stability of communities nationwide.

A significant obstacle small businesses face is the lack of awareness regarding federal programs aimed at aiding them. The SBA acts as a central resource providing accessible, explicit guidance, ensuring that small-business owners can effectively navigate available support. Without this dedicated aid, entrepreneurs would struggle to comprehend the intricate network of government programs scattered across several agencies, increasing confusion and inefficiency.

Rather than dismantling the SBA, efforts should be directed towards fortifying it. Congress should concentrate on enhancing the efficiency and scope of SBA programs, guaranteeing that small businesses have the necessary resources to thrive in a progressively competitive economy.

More than 60 million individuals in the U.S. are employed by small businesses, accentuating their significance in the nation’s economic advancement and prosperity. The SBA should not be viewed as bureaucratic red tape but rather as a critical collaborator in stimulating entrepreneurship and creativity.

For those who genuinely care about the future of small ventures and the economic vigor they provide to communities, it is imperative to invest in and modernize the SBA, not abolish it.

Todd McCracken currently serves as the president of the National Small Business Association.