The news leaked out Tuesday evening to the Washington Post: President Barack Obama on Wednesday is expected to nominate a Latino community banker and former California state cabinet official as the new Small Business Administration chief.
Obama’s pick of Maria Contreras-Sweet, founding chairman of ProAmérica Bank, signals a shift of priorities for the SBA. Former SBA administrator Karen Mills, who left her post in August to work at Harvard, was a Maine venture capitalist before Obama chose her in 2009. At the time Obama said he wanted a SBA head who could cut red tape and encourage entrepreneurship amid the worst recession since the Great Depression.
Mills is credited with doing just that, even as she was criticized for encouraging financing for not-so-small “small” businesses and failing to get a larger share of the federal government contracting pie for small firms. Fast forward five years, and overall small-business lending has not recovered to where it was before the Great Recession—a situation that especially hurt businesses that were minority-owned or in impoverished areas.
Obama’s choice, then, seems to recognize that the SBA going forward needs to focus more on boosting business ownership in disadvantaged communities, which Contreras-Sweet has plenty of experience in. She also knows a great deal about public administration and contracting because she was cabinet secretary for the now-defunct California Business, Transportation and Housing Agency, serving for five years under former Governor Gray Davis. That means lots of infrastructure and housing-related contracts to handle in the nation’s most populous state.
Interestingly, Contreras-Sweet was not widely mentioned as a potential pick for the job.
Obama's expected appointment comes at an interesting time: Some Republicans in Congress have recently been pushing to close the SBA and wrap it into the Commerce and Labor departments, turning the SBA administrator into an undersecretary. The bill from Republican Sen. Richard Burr of North Carolina actually has some similarities to an Obama government consolidation proposal from 2012. The president seems to be picking an opportune time to nominate a new SBA administrator and get into the conversation.
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