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Business Owner vs SBA vs Congress


The United States Small Business Administration (SBA) is under tremendous pressure from two sides with the COVID-19 Economic Injury Disaster Loan (EIDL) program. Under the CARES Act of 2020, the loan program provided massive financial support to Small Businesses during the pandemic. 

Now, many of those loans are in default status. A default status can occur due to any number of reasons including a missed payment or three, a failure to make full payments, or a failure to make full payments, or the ultimate default: failure to make any payments at all by ignoring the debt obligation.

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On the one side is the Small Business Owner who seeks Hardship Accommodation to repay the COVID-19 EIDL due to continuing economic challenges as they manage their businesses in these post-pandemic times.

Then, there’s the powerful political pressure on the opposite side by the politicians.

We’ve seen in recent months how members of the United States Senate and the House of Representatives—Senators and Congresspeople—are thumping their chests for political talking points and demanding that SBA collect on every penny of COVID-19 EIDLs, including demanding SBA pursue collection activities against small businesses that defaulted on their loan payments.

This second aspect is probably the most brutal because these same politicians are often the same people pursuing sound bites of “Small Business is the backbone of the American economy.”  And yet…here we are.  They would prefer to beat the drums of debt collection to drive business owners into bankruptcy, to heap massive debts with penalties and interest upon their shoulders for years, or even decades to come, with nary a care about their literal constituents, the small business owners.

For our part, as SBA EIDL experts, we’ve seen all sides of this terrible situation.

As a result, we often defend the people working at SBA. We believe they are good people struggling to do their best to meet this huge task dumped on them by the politicians without the requisite support necessary for a mission of this magnitude.

A viewer of our YouTube channel commented in response to our more forgiving and understanding perspective of SBA, “Sorry folks, you’re wrong the SBA doesn’t care…”

We responded, “You’re attributing some nefarious quality of personality to a bureaucracy. That is, on the face of it, absurd.”

We’ve spoken to hundreds of SBA representatives and the majority truly do care about their constituents, the small business owner.

What you need to do is to blame the Congress of the United States for this debacle because the SBA is underfunded, overworked, and overwhelmed as an agency tasked with such a massive undertaking, both during and after the pandemic.

First, Congress required this tiny federal agency to manage the distribution of the huge tranche of pandemic relief funds to small businesses. As task for which SBA was ill-prepared and inexperienced.

Second, Congress is now beating the drum about collecting on the debts with no regard for either the small business owners facing economic challenges nor the SBA inexperience in collecting debts on such a huge scale.

The Congress has not reauthorized this federal agency in more than two decades. By comparison, in 2023, Congress reauthorized the Federal Aviation Administration, providing expanded regulatory authority and a pile of money to upgrade technology and hire air traffic controllers.

No such undertaking is in the works for the SBA.

We appreciate you as a follower of our channel, but, please, before you tell us we are “wrong,” try to take a moment and reflect on our expertise in this area, the expertise drawn from real-time experience that informs our advice, our guidebooks, our consulting services and our YouTube videos.

Sorry, but not sorry.