[Congressional Record Volume 141, Number 124 (Friday, July 28, 1995)]
[Extensions of Remarks]
[Pages E1540-E1541]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


DEPARTMENTS OF COMMERCE, JUSTICE, AND STATE, THE JUDICIARY, AND RELATED 
                   AGENCIES APPROPRIATIONS ACT, 1996

                                 ______

                               speech of

                          HON. JOHN J. LaFALCE

                              of new york

                    in the house of representatives

                         Tuesday, July 25, 1995

       The House in Committee of the Whole House on the State of 
     the Union had under consideration the bill (H.R. 2076) making 
     appropriations for the Departments of Commerce, Justice, and 
     State, the Judiciary, and related agencies for the fiscal 
     year ending September 30, 1996, and for other purposes:

  Mr. LaFALCE. Mr. Chairman, I rise in strong support of this amendment 
offered by Mrs. Myers on behalf of the two of us. And I want to commend 
her for this initiative, although I do want to note that I would have 
preferred that the amendment not cut as deeply as it proposes to do. I 
believe a cut of almost 30 percent is more than can be accomodated 
without damaging the Office of Advocacy. Possibly the conferees on this 
bill can find another four or five hundred thousand dollars to add to 
the amount being added by the amendment.
  Mr. Chairman, of all of the functions of the Small Business 
Administration, the Office of Advocacy undoubtedly helps more small 
businesses for less dollars than does any other office within SBA.
  This is the Office whose testimony before the Congress has been 
requested 200 times. 

[[Page E 1541]]
Why have our committees requested input from Advocacy? Simply because 
the office tells it like it is even if it puts Advocacy at odds with 
the administration.
  This is the Office to whom this House of Representatives assigned new 
responsibilities of reviewing proposed regulations by Federal 
departments and agencies to identify those with anti-small business 
impact. Why did the House enlarge the duties of the Advocate? Simply 
because we know how effectively the Office has functioned as an 
advocate before other Federal offices.
  Some critics have charged that Advocacy has been an abysmal failure 
in reducing the regulatory and paperwork burden.
  Tell that to the small businesses which use simplified registration
   filings with the Security and Exchange Commission.

  Tell that to the 4 million firms with less than 10 employees which 
will be able to use one simplified tax form for all wage and tax 
reports instead of up to 15 separate forms.
  Tell that to the millions of small businesses which have a lesser 
burden in dealing with the Government.
  And, when you tell them of this criticism, small businesses will tell 
you that the criticism is wrong. These small businesses will tell you 
that the Office of Advocacy is effective. They will tell you that is 
why that last month the White House Conference on Small Business as one 
of the top recommendations said that the Office should be permanently 
maintained as an independent entity.
  I also want to point out that some of the criticism is not simply a 
difference in opinion. In some cases the facts used to support the 
criticism are wrong.
  Criticism. Advocacy staffers helped created a brochure to lobby for 
President Clinton's health-care plan;
  Fact. GAO reported that this is not true.
  Criticism. Advocacy sent a letter to Congress arguing against tax 
relief for small businesses.
  Fact. Advocacy opposed elimination of a special tax incentive to 
encourage investments in small firms. Advocacy did conclude, however 
that if the trade-off for the proposed reduction in capital gains tax 
rates was the elimination of the small business preference, small 
business would be better off if the rates were not reduced. The Office 
did support other parts of the tax bill which helped small business, 
such as increasing expensing, increased estate and gift tax credit and 
clarification of deductions for an in-home office.
  Criticism. Advocacy ``spent last Friday * * * faxing a 9-page `Game 
Plan' to congressional offices outlining a lobbying strategy'' to save 
the office, an activity characterized as illegal lobbying;
  Fact. The document in question was an internal office document which 
was never used nor authorized for release to any congressional office. 
As far as we know, it was not sent to anyone, except for the one copy 
that was surreptitiously made available to a congressional critic of 
the office; and SBA's Inspector General has determined that the memo 
was not a violation.
  A letter from the inspector general attached a memo from the 
assistant inspector general for investigations which concluded:
  ``Because there is no evidence of actual lobbying and no evidence 
contrary to the stated intent of the preparation of the document by Mr. 
* * *, it is my recommendation this case be closed without a referral 
for prosecutive opinion.''
  Finally critics have asserted that small business associations are 
the ``real independent voices for small business'' and ``do a better 
job of monitoring small business policy than the Office of Advocacy.'' 
These small business associations disagree.
  Major small business organizations unanimously support continuation 
of the Office of Advocacy, including the National Association for the 
Self-Employed, the National Federation of Independent Business, 
National Small Business United, Small Business Legislative Council and 
the United States Chamber of Commerce.
  The Office of Advocacy has performed as a champion for small business 
interests when it has been given a chance to do so. This chance, 
however, was denied when President Bush left the Chief Counsel job 
vacant for years at a time. When it has received strong presidential 
support as it did from President Carter, who appointed Milt Stewart as 
the first Chief Counsel for Advocacy, or from President Reagan, who 
appointed Frank Swain as Chief Counsel, or from President Clinton, who 
appointed Jere Glover, the office truly serves as a champion for small 
business.
  I urge adoption of the amendment.
  

                          ____________________