▶ 0:26:01>> I called the committee on small business and entrepreneurship to order. The purpose of today's hearing is to consider two of president's have Mr. bill briggs to serve as deputy administrator of the small business administration. And our second nominee is Dr. casey mulligan to serve as chief counsel for advocacy of sba's office of advocacy. I would like to welcome you both here today and thank you for your willingness to serve.
▶ 0:26:31Just to give folks a quick run of show, I'm going to make brief opening statements and then I will turn to ranking member markey to do the same. And I will introduce the nominees and will administer those. After those, Mr. briggs and Dr. mulligan will be recognized for their statements. These statements will be followed by questions from our members alternating between each side. I now recognize myself for five minutes for the purposes of an opening statement.
▶ 0:27:01Again, welcome to the committee and thank you, Mr. briggs and Dr. mulligan for your willingness to serve in these roles. Today we are considering nominees for two very important positions. I greatly appreciate the time you have spent meeting with me and my colleagues prior to this hearing. I want to take a minute to recognize some of the family and friends supporting you both today. First, raise your hand when I read your name. I want to recognize some of Mr.
▶ 0:27:30Briggs' family, his parents, thank you for being here, as well as his siblings, susan, robert, ted, and his nephew braden. Thank you for being here. And Dr. mulligan, I would like to welcome your wife, julia. And three of your five children, john, elizabeth, which is also my daughter's name, thank you, and may.
▶ 0:27:59We appreciate you all making the trip here. I appreciate you both have fully embraced the committee's standard, yet extensive vetting of your experiences and backgrounds in advance of today's hearing and our upcoming vote on our nominations. As I have shared with both of you, I believe some substantial reforms must be made to get the sba back in shape. That will require strong leadership area and I'm thrilled with administrator leffler's actions so far. She will need a strong partner.
▶ 0:28:29That is why the deputy administrator role is so critical. Traditionally, sba administers programs and services falling into three main buckets. Counseling, contracting, and access to capital. It to briggs previously worked at sba during the critical implementation of the paycheck protection program. These funds were vital to ensuring main business across america kept their doors open during the pandemic.
▶ 0:29:01Unfortunately, there has been fraught in sba's programs, especially in the covid economic injury disaster loan or idle program. I would like to know how you continue to root out these fraudsters. Small businesses need help and american taxpayers provided it. It is completely unacceptable that bad actors took advantage of this emergency assistance. Even more alarming, the federal government has not held these criminals accountable. That must change.
▶ 0:29:30So I look forward to hearing how you will these funds. Covid recovery is not the only challenge small businesses faced over the last five years. In my home state of iowa, small businesses are the lifeblood of our rural communities. For too long they have been crushed with redtape and burdensome, often unnecessary reporting requirements no one caring about how that affects day to day operations. This brings me to the role of the chief counsel for advocacy.
▶ 0:30:03Dr. mulligan, I'm impressed with your background and extensive work to ensure economic analysis properly reflects the cost to small businesses. The cost of regulations for small businesses is out of control. The last administration promulgated more than 1100 final rules costing $1.8 trillion.
▶ 0:30:27The biden administration's regulatory costs were 600 times higher than that of the first trump administration and 3.7 times higher than that of the obama administration. I have been encouraged to president trump's executive orders to freeze and rollback regulations.
▶ 0:30:45This to me shows a clear understanding of the need to evaluate the effects, the direct and indirect government regulation is having on america's economic growth. Advocacy possible remains true regardless of party. To ensure a strong chief counsel stands up to the little guy and warns regulators when small firms will be harmed.
▶ 0:31:08I have introduced the perfect act again this congress which requires agencies to consider both the direct and indirect cost based on small businesses when promulgating regulations. It also creates a process for small entities and representatives organizations to ask advocacy to formally review and agency's certification of a rule and prove it is compliant with the law.
▶ 0:31:36I want to ensure agencies respect and adhere to the existing laws and give advocacy further tools to dissuade federal bureaucrats from making poor decisions that harm small businesses. This is why advocacy needs a confirmed chief counsel and I'm pleased the president acted swiftly with this nomination. I want to thank you both for being here and I look forward to your testimony. I now recognize ranking member markey for his opening statement.
▶ 0:32:07>> thank you, madam chair. The small business administration is intended to support small businesses by providing capital contracts and counseling. So far, trump because sba only produced closures, cuts, and chaos. Across the federal government, elon musk's army of unelected bureaucrats is taking a chainsaw to agencies cutting contracts and breaking promises.
▶ 0:32:34About a quarter of all canceled contracts were to small businesses in our country. The president has already cut contracts with small businesses across our country. Many of which were owned by women and people in minority groups. The veterans affairs administration, also announcing $2 billion in contract cancellations. Including some to veteran owned service disabled veteran owned small businesses.
▶ 0:33:04Meanwhile, doge has barely touched the largest government contractors who were responsible for more than $200 billion in federal contract spending last year. $2 billion, they are all over that, the smaller companies. $200 billion, the defense contractors, they cannot find any fraud when we know there is waste and fraud all over those contracts.
▶ 0:33:28As sba specifically -- who have no government experience and zero small business understanding, they've already fired 720 employees. 20% of the workforce has been laid off.
▶ 0:33:43This includes those focused on disaster covering such as victims in north carolina and california as the small businesses seek to rebuild, they are laying off sba personnel who would be able to hear them, listen to their claims. Doge is also closing sba district offices to cut costs in springfield, massachusetts. We had a witness from springfield, massachusetts three weeks ago.
▶ 0:34:12They close down their office where that would have been process. It will make it harder for local small business owners to get help maria life human being. On top of this, sba also announced they would relocate six regional offices, including the boston location, over unfounded immigration issues. Administrator leffler has not provided congress with any information about these activities. We don't know who has been fired. We don't know which offices will remain open.
▶ 0:34:43We certainly don't know how many small businesses have been left without services because of the sudden unprecedented slash and burn tactics. Today the committee is meeting to consider the nominations of Mr. bill riggs to be sba deputy administrator and Dr. casey mulligan to be chief counsel at the sba office of advocacy. Mr.
▶ 0:35:04Briggs served as the acting administrator during the first trump administration and worked on the paycheck protection program in 2020 which provided needed relief to american small businesses during the pandemic and serves as a shining example of what congress can do when we work together. Traditionally Mr. briggs would report to the sba administrator and carry out day to day operations.
▶ 0:35:30Until the committee gets answers about doge's operations, I believe considering this nominee is premature. Senator shaheen released -- requested a briefing on doge inside the sba four weeks ago. Just so the committee could understand what is going on. And I'm disappointed the trump administration still has not complied. We haven't had any doge people come in. What are they doing in the sba?
▶ 0:35:58We are the committee of jurisdiction, we are the committee that created it. Will doge please tell us what they are doing? Next we are considering Dr. casey mulligan. Dr. mulligan has been hired to oversee the office of advocacy, independent agency within sba charged with advancing the news, concerns, and interest before the federal government. The beauty of this office is its independence. It is statutorily required to operate separately. Not only from sba, but from the white house.
▶ 0:36:31However, doge has already infiltrated the office of advocacy and threatened its independent status. Separately, I'm concerned about Dr. mulligan's potential approach to this role. Dr. mulligan is an economist at the university of chicago, a widely respected institution. Based on his work, I believe his views on regulations life are outside the mainstream.
▶ 0:36:54He questions policies most americans take for granted, minimum wage, paid sick leave, reasonable limits on pollution and rules that prevent insurers from discrediting against people with pre-existing conditions. Without such policies, we would be taken back to a dickensian world with no worker environmental, patient, or consumer protections. Regardless was president, every entrepreneur should be able to rely on sba to help them grow their business.
▶ 0:37:24We must return to this principal and be dependable for the 34 million american small businesses that run our country. Unfortunately, I do not think that is the goal which elon musk and president trump have for our country. Madam chair, I yield back. >> thank you, ranking member markey. As noted by senator markey, on february 12 at our hearing, senator shaheen did request an update from doge at the sba.
▶ 0:37:55I have made that request. The two gentlemen in front of us today are not part of the sba yet. We hope to confirm them very soon. We have made the request, and hopefully we will have a doechii briefing soon for the committee members. I would like to now take a minute to introduce both of our nominees. First we will start with Mr. william briggs, the nominee for deputy administrator of the sba.
▶ 0:38:27Originally from new york, Mr. briggs currently lives in austin, texas, where he acts as director of regulatory and federal advocacy for the independent bankers association texas. Previously he served as the acting associated administrator in the sba office of capital access and was instrumental in the rollout of dpp during the first trump administration. Mr. briggs also served as director for the office of public outreach in the U.S.
▶ 0:38:56Environmental protection agency under president george w. Bush. Additionally, Mr. briggs has owned two small business consulting firms. Sturbridge received his undergraduate degree from the university of michigan. Next we have Dr. casey mulligan, the nominee for chief counsel for advocacy. He grew up in illinois and is currently a professor at the university of chicago.
▶ 0:39:21Specializing in labor, economics, public policy, and the impacts of regulation on economic during the prior trump administration, he served as chief economist for the white house counsel of economic advisers, where he played a key role in important policy discussions. Dr. mulligan also owns two small businesses focusing on consulting and economic research. Dr.
▶ 0:39:48Mulligan received his bachelor of arts from harvard university and earned his phd in economics from the university of chicago. We think both nominee's families and friends for being here today. Mr. briggs and Dr. mulligan, if you would both rise. It is the tradition of our committee to swear in our nominees. Please raise your right hand and answer the following questions.
▶ 0:40:14Do you solemnly swear to tell the truth, the whole truth, and nothing but the truth, so help you god? Should you be confirmed as deputy administrator of the sba and chief counsel for advocacy, are you willing to appear and testify before any duly constituted committee of congress when requested to do so? Are you willing to provide such information as is requested by any such committee?
▶ 0:40:44Thank you both very much. You may take your seats. Very briefly I would like to take a moment to explain our lighting system that is right in front of you. There are three lights, green means go. Yellow means you are running out of time. And red means to wrap up your remarks. I asked unanimous consent that the nominees. Be included in the record. Without objection so ordered.
▶ 0:41:15As your written testimony has been made part of the record, the committee ask you limit your oral remarks to five minutes. Mr. briggs, you are now recognized for five minutes for your testimony.
▶ 0:41:28Mr. Briggs: Thank you, and ranking member markey and established members of the committee. My name is bill briggs. It is a great honor to appear before you today as president comes nominee for deputy administrator of the small business administration. And grateful to president trump for offering the opportunity to serve america's 34 million small businesses which are the backbone of our economy, the lifeblood of our communities, and the engine of innovation prosperity.
▶ 0:41:58Mr. Briggs: As go small business in our country, so goes our nation. I would like to briefly knowledge my friends and family here today, including my parents . I would also like to thank the administrator for her support. There's no stronger advocate for american small business, and already sba is seeing the restoration under her leadership. Finally I want to thank god for everything. Especially the challenges which make me rely on him.
▶ 0:42:26Mr. Briggs: During president comes first term, our nation's economy was the envy of the world. Operators and jobseekers alike were empowered. Driving small business formation and blue-collar boom. Tax cuts, fair trade deals and the regulation his agenda created 7 million new jobs, delivered historically low poverty, and record employment for minority communities. Small business optimism has surged since the november election because entrepreneurs know that help is on the way.
▶ 0:42:55Mr. Briggs: If confirmed, it will be my third time as presidential appointee and administrator leffler will be the fourth cabinet level administrator I will have the opportunity to serve. During my prior service, I oversaw the operations of the paycheck protection program which helped save 11 million small business jobs. I hope to leverage a wealth of institutional knowledge and lessons to hit the ground running if confirmed.
▶ 0:43:21Mr. Briggs: Bring to the role over two decades of public service and private sector experience. My first job out of college was state government working on veterans affairs and local development issues. I've served in senior roles at industry trade associations, interspersed with two presidential. During the last trumpet ministry and, I served as acting associate administrator in the office of capital access where I saw all lending programs.
▶ 0:43:48Mr. Briggs: I also served as his visor to the administered on engaging small businesses during this crucial time in the agency's history. Finally, I laid internal agency reform efforts, including the sba field alignment and rebranding initiatives launched under then administrator linda mcmahon. Like many americans, my belief in the power of small business is personal. My family deep in service to our country as much as the spirit of entrepreneurship. Both my grandfather served in world war ii.
▶ 0:44:18Mr. Briggs: My mother who is here today was an army nurse. Two of my brothers served overseas in our armed forces. Two of my sisters currently run a small business today. And I have owned and operated two small businesses myself. My sister owns a small landscape design company. And often shares how excessive regulations including the extensive environmental permits, take about time, drive up her equipment costs, and hamper her ability to serve clients.
▶ 0:44:45Mr. Briggs: She's forced to either cut back on employees, reduce services, or cut into her own bottom line. Her stories the story of millions of small businesses put under the enormous strain over the last four years with excessive regulation, crushing and big government bureaucracy. A private sector hiring, the beginning to recover under president trump, has declined over a year.
▶ 0:45:10Mr. Briggs: If we bring back jobs to ensure that economy continues to grow, we must first unshackle and support free enterprise. One of the ways to do that is to ensure sba is effectively serving small business. By cutting regulation, eliminating fraud and waste, streamlining and modernizing services, and refocusing the agency on its four of helping entrepreneurs thrive. With the america first agenda, we are poised to unlock a new era of growth.
▶ 0:45:38Mr. Briggs: An opportunity for the risktakers, job creators, and innovators who power the nation's economy. I look forward to supporting president trump and administrator leffler to make sure the programs deliver real results for mainstream and all-america. Chair ernst, ranking member markey, and members of the committee, thank you for your dedication to U.S. small businesses. I welcome your questions and would be honored to in your support to serve as the next deputy adventist reader of the small business administration.
▶ 0:46:09Mr. Briggs: >> thank you. Dr. mulligan, you are now wrecked nice for five minutes for your testimony.
▶ 0:46:17Dr. Mulligan: Chair ernst, ranking member markey, distinguished member of the committee. Thank you for the opportunity to appear before you. My wife and three of our children have joined us to witness part of the system of checks and balances. I appreciate their support and sacrifices as I hope to serve again. I'm grateful and honored by president trump's nomination for the chief counsel position of the office of advocacy.
▶ 0:46:48Dr. Mulligan: And to join the presidents team, committed to replacing government overreach with common sense leadership. I have always lived in illinois the exception of five years living in the ranking member's state and one year in washington. After I was about three years old, my parents soul source of income was a small software business my father founded and managed with a partner.
▶ 0:47:17Dr. Mulligan: Uncle also worked most of his career at the business. My mother and I worked there at that time. In my current capacity as the owner of small businesses, I'm too familiar with uncompromising regulators. Agencies can shutter businesses or short of that, because them to throw out their hands in exasperation and sell off to a big corporation. I file at least 10 payroll tax forms every year.
▶ 0:47:47Dr. Mulligan: It seems as soon as one is mailed out, the irs is asking for another with a check attached of course. I got one of my biggest accounting bills a few months ago to comply with treasury's beneficial ownership interest requirements. Considering the relief president trump just delivered on that, maybe it wasn't necessary. But at the time, the treasury was threatening all small businesses with monetary and criminal penalties.
▶ 0:48:15Dr. Mulligan: Much of my career has challenged regulatory overreach and uncovered unnecessarily onerous rules. One of my early projects was commissioned by family farmers in central illinois. They needed to look at the economic effects of an eminent domain because the state was using that authority for private purpose. I testified about that at the illinois commerce commission. My late father-in-law started an oyster farm.
▶ 0:48:47Dr. Mulligan: Now run by our nephew. Uncompromising regulators loom even larger there, always shifting attention away from the shellfish and towards the customers by hiring lawyers and experts. Once, the farm had to prove the regulators don't know how to measure nitrogen. Another time, it was to refute the government's false claims that the land under the water.
▶ 0:49:14Dr. Mulligan: I strongly support congress' approach of creating an independent office of advocacy and other elements of regulatory fix ability act to ensure concerns and cost imposed on small businesses receive meaningful weight in regulatory decisions. While they exist on paper, too often, small businesses are getting ambushed. Too many rules are imposed without engaging or notifying them.
▶ 0:49:44Dr. Mulligan: The rfa has rules for regulators to follow, but often that attitude is rules for the, not for me. President trump does not tolerate two-tiered systems. The law requires keeping businesses in the loop. It requires reviewing the old rules for their effect on small businesses. Agency complaints does not necessarily need many resources. Particularly when there is an advocacy office that are ready to help supported by congress and the white house.
▶ 0:50:14Dr. Mulligan: By insuring the chief counsel position is filled, for the first time in many years, the members of this committee can fully restore small business advocacy and rfk watchdog functions that created in its statutes and small businesses deserve. Small businesses also need regulatory solutions that last beyond a single presidential cycle.
▶ 0:50:37Dr. Mulligan: They appreciate the 115 congress and president trump used the congressional review act record number of times. And this congress has gone off to an even faster start. If confirmed, I look forward to working with this committee and anyone else in congress developing legislation to help agencies achieve their missions at less cost to small businesses. I also pledged to keep you apprised of the concerns expressed during the traditional outreach process.
▶ 0:51:07Dr. Mulligan: I think the committee for its configuration -- consideration, welcome your questions, and would be honored to support the service -- service next chief counsel of the sba. >> wonderful, thank you. Before we move to questions, the committee has received several letters of support from Mr. briggs and Dr. briggs nominations. I would ask for unanimous consent to enter into the record letters of support for Mr.
▶ 0:51:37Dr. Mulligan: Briggs, letters of support from the national restaurant association, independent community bankers of america, national small business association, national association of government guaranteed landers, international franchise association, texas association of business, independent bankers association of texas, texas venture alliance, economic and community development institute, the association of women's business centers, visiting
▶ 0:52:07Dr. Mulligan: Angels, small business multi-cloud coalition and U.S. black chambers. For Dr. mulligan, letters from the national small business association, small business and entrepreneurship counsel, international franchise association, joint letter from tom sullivan, the sba chief counsel and advocacy from 2002 to 2008, and one full sergeant, the chief counsel for advocacy from 2010 to 2015.
▶ 0:52:35Dr. Mulligan: In the letter from darrell depriest, the sba chief counsel for advocacy, from 2015 to 2017. Without objection so ordered. I will now recognize myself for five minutes of questions. We will start with Mr. briggs. During your service in the previous trump administration, you had direct insight into the covid idol and ppp.
▶ 0:53:03Dr. Mulligan: Both programs have suffered from a lack of transparency and experienced over $200 billion in fraud. These same problems plague many of the sba loan programs as I highly did during last month's hearing on the seven a loan program. If confirmed, do you commit to providing the committee with comprehensive and current information on how the sba loan programs are performed. >> chair, thank you for the question.
▶ 0:53:33Dr. Mulligan: I'm tremendously proud of my service. Particularly with the paycheck protection program and the idle program. I think they did an incredible job helping to preserve american small business jobs. The worst economic crisis since the great depression. As you have noted, there is too much fraud in these programs, and part of that, with ppe, some of it was statutory mandated guardrails that had to be let down.
▶ 0:54:05Dr. Mulligan: When I was acting associate administrator, we implement it upfront text that eliminated a lot of that fraud. Since that time, I understand there have been more upfront checks and their k -- verification procedures introduced. Should I be confirmed, I will focus on cracking down on fraud in the current programs and have a zero-tolerance approach to fraud going forward. >> very good, I appreciate that. I'm worried the seven a loan program could require an appropriation if those defaults are too high.
▶ 0:54:35Dr. Mulligan: Without enough fee revenue to offset the losses we have experienced. Looking -- will you continue to reviewing the loan portfolios and make necessary policy changes to avoid taxpayers winning the bill, including tightening up eligibility. >> the seven a program is casual for the first time in 12 years.
▶ 0:55:01Dr. Mulligan: It is a serious problem and one that also millions of reducing access from small business. The administrative capital access and all the other relevant sba staff and I worked to make sure we are putting that program back to its historical position of having a neutral subsidy where taxpayers are not taxed around the program. >> very good. What in your experience were the pitfalls of the sba covid programs?
▶ 0:55:31Dr. Mulligan: >> chair, I have spent the last four years thinking about lessons learned from that experience. It was an unprecedented time as I remember this committee knows, and is ranking member markey, we work on it at a perilous time in our nations history. I would say the first thing is not to shut down the economy and hope that is something sba can solve the problem.
▶ 0:55:57Dr. Mulligan: I think if that situation never happened again, upfront identity checks and verification. And also to be clear about eligibility guidelines going forward, all things we need to do in capital access and disaster loan programs. >> very good, I appreciate that. We will go to Dr. mulligan next.
▶ 0:56:22Dr. Mulligan: Under the prior administration, small businesses across the country were burdened with a $1.8 trillion regulatory onslaught and over 350 million hours of paperwork. While the regulatory flexibility act requires agencies to consider how regulations impact small businesses and look to evaluate less burdensome alternatives, agencies have not followed the law.
▶ 0:56:51Dr. Mulligan: I did reintroduce the pruitt act to require agencies evaluate the true cost of regulations and to empower advocacy's role to make the agency prove the regulation is necessary and costs against compliance burdens for small businesses. Do you support increasing transparency and accuracy in the cost to benefit analysis aspect of the sba rulemaking process? >> absolutely. >> easy.
▶ 0:57:20Dr. Mulligan: >> do you agree agencies have failed to properly consider the indirect costs of the regulations? >> almost all of them I have looked at have been pretty weak considering those costs. >> if confirmed as chief counsel for advocacy, will you commit to properly evaluating agency rulemaking for both its direct and indirect impact on small businesses? >> I commit to do that. >> thank you. You supportive of the prove it act? >> yes, I support the prove it act.
▶ 0:57:51Dr. Mulligan: >> nighttime is expired. Ranking member markey. >> thank you, madam chair. The office of advocacy sits within sba. But the chief counsel is statutorily independent from the sba administrator.
▶ 0:58:10Dr. Mulligan: Your work is by statute not permitted to be submitted to the office of management and budget, but any other federal agency or executive office. That includes omb. You expressed to my staff you take that independence seriously.
▶ 0:58:36Dr. Mulligan: However we know elon musk's minions have had conversations with leadership at the office of advocacy. Can you commit to the committee you will refuse to take instruction from those or from the administration so that you are in compliance with the statutory mandate? >> thank you for your question. I support president trump's goal of making government more efficient.
▶ 0:59:08Dr. Mulligan: He won a mandate in the election to do exactly that. >> he did not win a mandate to violate statutes. He said he was going to follow the law. The law says if you cannot share information, are you going to abide by that law? >> if you look at advocacy charter statute, and how it has changed over time, it is clear the number one advocacy has a special authority. The authority lies with the chief counsel.
▶ 0:59:40Dr. Mulligan: >> again, I'm going to read the statute again. Your work is by statute not permitted to be submitted to the office of management and budget on any other federal agency or any executive office. Do you agree to abide by that law? >> yes -- all the statutes related to the office I will abide by. >> he will not share that information with any other agency? >> that is correct.
▶ 1:00:08Dr. Mulligan: According to statute, and would be my practice to do, submit it to the congress and the president. >> what do you believe is your role in ensuring congressional mandates are followed regardless of executive directives? Do congressional mandates take privacy if they are there as the abiding law?
▶ 1:00:32Dr. Mulligan: >> I'm not sure I understand the question -- are you referring to executive order question >> do you believe statutes that have been put on the books by house and senate votes and signed by presidents take precedent over executive directives? >> I'm confused by the question, because I served in the first trump administration, and followed the second one, and there are a lot of executive orders.
▶ 1:01:00Dr. Mulligan: Every single one I've looked at, the primary instruction in those executive orders is for the people reading it to follow the laws of the united states. >> right, so you're saying if there is a statute, you would abide by that statute and not allow for an executive order -- x I would do that. I expect as president trump has done almost 300 times in the past, to follow the laws of the united states.
▶ 1:01:27Dr. Mulligan: >> all right, well you do believe statutes are at a higher order than executive orders in terms of what you must obey? >> I'm confused because the executive orders himself say to follow the laws of the united states. I don't see the conflict. >> all right -- sometimes presidents when they are making executive orders believe that they are the law, even though there is a statute which is very clear as to what the law read. So that is the point I'm making to you.
▶ 1:02:00Dr. Mulligan: I will be holding you to that standard. Will you use loyalty tests or any other criteria unrelated to an employee because work product when making hiring or firing decisions? >> the advocacy -- which was created, and if I'm confirmed, would be michael as well to be an independent voice for small business in washington.
▶ 1:02:28Dr. Mulligan: The hiring decisions, procaine renders it -- decisions will be how we can be a better independent voice for small business with the agencies in washington. >> have you met with the team in advocacy yet? >> I have not been in the building. I think we call it a sherpa, helping find my way to your office and the different senator paul offices for the meeting. But I have not met the staff. >> heard stories of specific industries meeting at mar-a-lago and getting special treatment from the administration.
▶ 1:02:58Dr. Mulligan: Do you agree that it creates market distortions? When special treatment is handed out and it is not an evenhanded application of the law? >> I'm a little confused by the question. I have not been to mar-a-lago, I'm not sure what businesses or conversations or had. I would look in detail on what you are referring to. In the abstract I don't really understand the question.
▶ 1:03:24Dr. Mulligan: >> it is very clear if someone visits mar-a-lago and the president says give special treatment to one particular company, that it would obviously begin to create a market distortion because it would not be an equal application of the law that the sba's will to be discharged. >> I'm also confused by that. I apologize.
▶ 1:03:53Dr. Mulligan: Legal terms in economic terms like market distortion, I'm not quite sure the connection. I'm not a lawyer, I do understand the market distortions, I'm not quite sure how they apply in this situation. >> thank you. >> thank you, ranking member markey.
▶ 1:04:17Dr. Mulligan: Going to recognize myself now as acting chair on behalf of chair ernst for five minutes to ask a few questions. I want to start with the small business administration, Mr. briggs, and I hold no grudge the fact you are a michigan grad as a senator from ohio.
▶ 1:04:42Dr. Mulligan: The idea -- I remember asking a college president one time about this university he was running. I said can you tell me with the three things you are really good at? And he told me five. Five things -- maybe six things the university was good at. I said what are some of the things you may not be good at that you should not be doing any more? He cannot come up with one.
▶ 1:05:14Dr. Mulligan: Nobody, no institution is great at everything. There are things they discover over time that they have great value in, and things to say maybe we should not do that anymore. Maybe there is something better we can do with those resources. Based on your experience and knowledge of the agency, reflecting on the nature of that question, what is it that sba does that is great, and what might we we think -- re-think prioritizing resources around that we can do better?
▶ 1:05:44Dr. Mulligan: >> thank you for your question. I except ohio state won the football championship. Here is what sba does well and with the focus find confirmed will be. Doing its core mission well. When I called preseason d. Access to capital, small businesses to grow. The other important feature of that is the disaster function.
▶ 1:06:08Dr. Mulligan: We have been there as it were five years ago during the covid pandemic to make sure we are also there now when disaster strikes across the country. Those are things that agency can and should do well and will be the focus should I be deputy at ministry to. The things agency doesn't do well are things like direct lending, voter registration efforts, and picking winners and losers.
▶ 1:06:29Dr. Mulligan: That should not be the focus of the agency when it comes to programs and policies, but in ensuring that all of the core missions I described are available and accessible to all americans. So on the final point of things it does not do well, is it required to do that in statute anywhere? >> senator, I have been reading the small business act that night because I have not been able to sleep in advance of the hearing. I cannot find that.
▶ 1:07:01Dr. Mulligan: I think there are programs in the government contracting area that work with socially disadvantaged. But that is a separate thing from what we are historically referring to as d.e.I. Programs. I'm not aware of that. >> I would assume with the administrator's support, that you will no longer be doing those things at the agency in the past has been doing but has no response ability to accomplish?
▶ 1:07:29Dr. Mulligan: Ask senator, if I'm confirmed, I will follow law and focus on the core agency missions and access to capital contracting, capital disaster response. >> Mr. mulligan, thoughts on any of those questions? >> thank you for your question. The advocacy office is a fairly small office, about 15 people. It has a fairly tight range of response abilities congress assigns to it.
▶ 1:07:57Dr. Mulligan: They have been executing those responsibilities and not going outside those boundaries. >> and q. Mr. briggs, another thought. Part of my previous responsibilities before becoming U.S. senator, I was involved in economic development and supporting entrepreneurs through venture funds and security and ip like that.
▶ 1:08:26Dr. Mulligan: I have really bumped into an operator who's told me they need the government involvement in much of what they do. They normally talk about the things government does that are in conflict with what entrepreneurs want to do. In your experience with small businesses and entrepreneurs, what are the things they most note?
▶ 1:08:51Dr. Mulligan: You are a government agency designed to help businesses, yet most businesses will complain about government standing its way. What are some of the things you have encountered that businesses most commonly tell you -- particularly small businesses, that are problematic for them? >> senator, over the last four years, I have worked in council from everything to ventures backed startups and mom-and-pop shops.
▶ 1:09:18Dr. Mulligan: Almost across the board, they are not aware of the depth of the regulations they have to follow, that they had no idea about. Especially with venture backed businesses, particularly in the financial technology arena. It is just to get to a minimum viable product, is unprecedented, and they don't understand sometimes what to do regardless of the great resources sba can provide, including counseling or access to capital.
▶ 1:09:48Dr. Mulligan: >> one of the things I think this committee would find of value is as you are out there with counselors and capital in talking with small businesses, if you could compile a list for us of the kinds of common concerns businesses are identifying, that they could use relief, that we don't need government maddening -- money,
▶ 1:10:22Dr. Mulligan: Government help, we need relief from the regulations and things that get in the way. One of the things I would think would be of value to me is for sba to identify those things that are commonly discussed by the businesses you are going to help as impediment to their success. So instead of all the government can do for people, and said how about the government and stop doing to them that send in the way of their success?
▶ 1:10:51Dr. Mulligan: Would you commit to working with -- to accomplish that? Wake senator, I will commit to working with that, particularly with the sba office of the -- >> great, thank you. Now I would like to recognize senator cantwell for five minutes. >> thank you, Mr. chairman. Welcome to the nominees for your positions. I know you probably have given a statement I have not been able to read yet.
▶ 1:11:22Dr. Mulligan: So we will look at that rate I wanted to ask about this pressing issue on tariffs. Dr. mulligan, do you think the parents -- the presidents first approach? You discuss the tariffs of mexico and canada to our largest trading partners what you think it would have on small businesses? >> thank you for your question. Good to see you again.
▶ 1:11:49Dr. Mulligan: Trade policy absolutely must consider the concerns of small businesses. Congress created an independent office to advocate for them. President trump more than any president has prioritize getting the chief counsel position filled. If it goes in field too long, we can be in a position where it is mainly the big companies that are heard around trade policy rather than the small ones.
▶ 1:12:14Dr. Mulligan: >> so you think in general because there's less flexibility or maneuvering, it could be a bigger concern? >> and also that their voice in washington is weak without having an office like advocacy at full capacity and full efficiency.
▶ 1:12:35Dr. Mulligan: >> and what do you think we should be doing to communicate about the impact on those small businesses? >> one thing very important might be the primary thing the office of advocacy does, go out to the small businesses where they are. Don't require them to know what door and what elevator to use, go out to them. Sometimes in virtual mode, especially for the rural.
▶ 1:13:07Dr. Mulligan: And listen. And come back to the makers of the policy, trade policy or other agencies, and tell them here is the concerns we heard from our businesses. In the rfa requires you to consider those concerns when you make your policy decision. >> thank you. Mr. briggs, do you have any comments? >> with respect -- thank you senator cantwell.
▶ 1:13:34Dr. Mulligan: I would note from my understanding of the tariffs proposal, part of it is to bring back manufacturing to this country. We have seen initial indicators that 11,000 manufacturing jobs in the previous month. I do believe it is part of a larger effort to ultimately do that to bring back manufacturing in our country. >> I don't really agree on the manufacturing jobs.
▶ 1:14:02Dr. Mulligan: I would say to my colleague from ohio who was ably chairing the meeting that I'm concerned because we have brought back manufacturing jobs in the U.S. because of the chips and science act. The president right now maybe wants to get rid of that.
▶ 1:14:26Dr. Mulligan: I would say in places like ohio, arizona and texas it has brought back manufacturing and in washington it brought back manufacturing. Manufacturing jobs help people go from working class to middle class because they are good paying jobs and they help small businesses build an ecosystem.
▶ 1:14:47Dr. Mulligan: I think the presidents statement that somehow he could have gotten the semiconductor industry manufacturer in the usa through tariffs, I don't agree with that. But the point is that I hear so many people saying we haven't grown manufacturing jobs and the biden restoration -- administration. How do we put the pedal to the middle and keep growing it?
▶ 1:15:17Dr. Mulligan: One thing people have been discussing is, how can the policies of the small business administration with access to capital, targeting the supply-chain issues, give the american economy a leg up? For example in my state we have a lot of, three different fusion companies. We will see if fusion technology is really here.
▶ 1:15:41Dr. Mulligan: Senator risch and I share a group that has made recommendations to the U.S. about how we would accelerate but when you think about chips and science, let's get the next generation done, then let's make sure we have the supply-chain to accelerate if we can, just accelerate now, whether it is fusion or something else.
▶ 1:16:06Dr. Mulligan: Let's work with our supply chains and small businesses so they are providing those products in the united states. I want, do you think that is a smart strategy?
▶ 1:16:18Mr. Briggs: Thank you for your question. I assume you are addressing me.
▶ 1:16:25Sen. Cantwell: Yes.
▶ 1:16:27Mr. Briggs: I support your remarks that manufacturing can start a small business. My focus of unconfirmed is help bring back manufacturing and make sure sba's core programs function as best as possible to serve the small businesses that may come about because of a manufacturing renaissance of the trump administration.
▶ 1:16:52Sen. Cantwell: My statement was a little different. It said the test vetting of, the chips and science act is about speeding up technology to have it faster than it normally would because big companies or large organizations may not have the money to do the research, the actual test vetting. Once the test vetting is done we are off to the races. Now how do we continue to lead?
▶ 1:17:19Sen. Cantwell: It is not that manufacturing would dry up, it is what could sba do to help build that? Being cognizant of those opportunities. I do think when you think about the ai situation, my time is up. I'm almost over.
▶ 1:17:41Sen. Cantwell: But you think about chatgpt, we basically demonstrated a major milestone that happens in ai and then immediately, china tries to knock off one aspect on how to do it in a cheaper fashion.
▶ 1:17:59Sen. Cantwell: Hand in hand with being the leaders in technology and innovation is how do we continue to lead on the small and supply-chain side of getting those products and resources there so the ecosystem can be more aggressively grown? I do think our great prowess as a nation is to outpace other countries on the r&d end implementation so thank you so much. I will have more questions for the record.
▶ 1:18:28Sen. Ernst: I will do a second round of questions. The ranking member will be back and will have additional questions as well as a closing statement. We will go back to Mr. briggs. Last year sba failed to alert or provide the committee with any information before the agency ran out of funding or its disaster assistance program.
▶ 1:18:55Sen. Ernst: Administrator leffler committed to ensuring congress has transparent and timely information from sba. Can you confirm that sba will keep congress informed of any changes in sba's disaster program or any potential shortfalls?
▶ 1:19:12Mr. Briggs: Thank you for the question. In my previous times as a presidential appointee especially during covid, I saw that as part of my job to keep congress informed especially this committee.
▶ 1:19:25Sen. Britt: -- Sen. ernst: under the biden administration, changes went in place likely exacerbating the problems that led to the program shortfall last fall. As someone with experience leading the office of capital access, how will you ensure the disaster loan program is properly managed?
▶ 1:19:48Mr. Briggs: Thank you for the question. I did oversee the office of capital access are merging with the office of disaster zone of the systems are somewhat merged. The things we would do is work with the current associate office to understand especially over the last eight weeks, what has been done and work with the new cfo.
▶ 1:20:18Mr. Briggs: This is basic blocking and tackling. We have to make sure there is enough money because we know disasters are coming. It is inexcusable. We don't know when. Covid taught us one thing. Think of the worst work double or triple it. If I confirmed that will be my focus to work with the cfo's office and the office capital access on the disaster program.
▶ 1:20:41Sen. Ernst: You are committing to ensure that it shortfall never happens again, is that correct?
▶ 1:20:47Mr. Briggs: Yes.
▶ 1:20:50Sen. Ernst: I have two and a half minutes remaining so let's go Mr. briggs and talk about disaster field training. Iowa experiences disasters. Derechos tornadoes, named it. We had a powerful blizzard that left thousands without power and now we are about to go into tornado seasons.
▶ 1:21:22Sen. Ernst: In the aftermath a lot of folks are at their most vulnerable. It is something that is tragic. They are doing their best to pick up the pieces of lives that have been destroyed by something completely out of their control. Disappointingly, we heard repeated reports over the years of sba field staff showing poor customer service to disaster victims who come to them for help.
▶ 1:21:45Sen. Ernst: Victims have been profiled, made to feel sba can't do anything for them and left with completely incorrect information. This happened in iowa. This is unacceptable and it must be changed. As sba deputy administrator how will you ensure sba disaster field staff will be properly trained and equipped to help disaster victims access sba assistance?
▶ 1:22:11Mr. Briggs: Thank you for the question. It is inexcusable when situations happen like that and people are at their most vulnerable. In the prior administration I undertook the feel alignment initiative to ensure that is consistent customer service across the country so the customer service small businesses. Deniable was the same they would get in massachusetts. I take great pride in this.
▶ 1:22:41Mr. Briggs: I was the associate administrator -- I believe the associate administrator is from iowa. People need the sba during disasters. That was made clear to me during my prior term as being a key focus, getting the disaster fan right going forward.
▶ 1:22:57Sen. Ernst: Thank you. I appreciate the commitment. And then -- ok. Just a very quick break,, and we will continue. I think we have one more senator coming and then we will go back to senator markey.
▶ 1:23:21Sen. Ernst: A bit about our experience in iowa, last year during the tornado season we saw a number of our small immunities -- communities that have been wiped out by disasters. In one case 60% of homes and businesses in one town was gone after a tornado. My own staff was on the ground to assist those people who had been impacted by the tornado.
▶ 1:23:46Sen. Ernst: The sba field staff provided inaccurate, incomplete, absolutely wrong information and provided them a handout with the website that had been dead for heaven knows how long. That is why it is important. We need to provide people accurate information when they are most vulnerable. Mr.
▶ 1:24:09Sen. Ernst: Justice is getting situated so senator, if you are ready to proceed with questions, we have had some great dialogue today. You are recognized.
▶ 1:24:21Sen. Justice: Thank you, both of these wonderful young men that I have had the opportunity to talk to. I appreciate you. I can tell you this. From jim justice's standpoint, he is a business guy, not a politician. I may small business guy and I have had dialogue with these individuals.
▶ 1:24:49Sen. Justice: We are flat last to have them both. -- blessed to have the book. Mr. briggs was here before. You bring so much to the table. Mr. mulligan, I'm so impressed with you.
▶ 1:25:05Sen. Justice: With all that said, I have a couple questions that are kind of bland in themselves but I would tell you first and foremost that you can't fathom in west virginia, how important small businesses are. We can't fathom across this nation, absolutely that the guts of, the absolute everything we have in this nation, starts with our small businesses.
▶ 1:25:37Sen. Justice: With that said, again, we have two guys here who are going to lead us and knock it out of the park. I promise you that. If I could ask this real quick, Mr. briggs, you have been there before. My question is, can you tell us the day -- today how your prior experience at sba will serve you the best answer all of us at the highest level?
▶ 1:26:07Mr. Briggs: Thank you senator for the question. During the first term I had the privilege to travel to your state three times on the office of capital access business. I'm a big fan of west virginia.
▶ 1:26:20Sen. Justice: And you left it. -- loved it.
▶ 1:26:23Mr. Briggs: We did that during the rural admin. I served at a crucial time in the sba and it was stretched to its limit. With that kind of experience, battlefield experience, you learn things you otherwise never learn. You understand how the agency works and what needs.
▶ 1:26:48Mr. Briggs: In addition to insider knowledge, I bring tremendous external relationships formed during that era and a willingness to work with the committee on both sides, particularly when it comes to disaster response and related issues to better serve american small businesses.
▶ 1:27:03Sen. Justice: I believe every part of that. Absolutely not only do I believe, but we will hold you to that. I think we will hold you to that very proudly. If I could ask Mr. mulligan real quick and say this. West virginia, I spoke a second ago, I had the great opportunity to be the governor of west virginia for eight years.
▶ 1:27:34Sen. Justice: Think about this. I said this over and over. What is my number one responsibility when I was the governor? My number one responsibility, you may think take care of the people. Absolutely be there when things get tough on them. All of those things are true. Absolutely, make sure we are safe. All those things are true. The number one thing that I felt was get the economics right.
▶ 1:28:05Sen. Justice: Make sure the economics were right. If the economics were right, you could do so much for so many. If the economics are upside down, when I walked in the door and I don't see this braggadocio sleep but west virginia was bankrupt. We got it really cooking.
▶ 1:28:25Sen. Justice: At the end of the day, we wouldn't have gotten it cooking if it ■wasn't for great people like you and absolutely all the support of sba across the planet in west virginia. Mr. mulligan, understanding that and understanding how vital our economy is, tell me a couple things about how you would support our rural economy.
▶ 1:28:53Mr. Mulligan: Thank you. I was glad to be in your office and share with you priorities I have for the office of advocacy if I'm concerned -- confirmed. Rural small businesses, really listening and coming back and communicating so the office has been historically west virginia to visit the small businesses that were there. We recently visited a business.
▶ 1:29:23Mr. Mulligan: With the farmers, we have the opportunity to meet them, virtual meetings. The point is to listen and come back to washington, in washington they have authority but not knowledge, and really the small businesses in west virginia have concerns and you need to take them to account before you make policies.
▶ 1:29:44Sen. Justice: One comment, you are splitting bull's-eye on one thing. I'm a believer, if you want to know what is going on with your business you need to get dirty and get with the people. Literally, I hear you in every way. That is a terrific answer to me. Madam chair, thank you so much.
▶ 1:30:06Sen. Ernst: Thank you, senator justice. We will go to senator hickenlooper.
▶ 1:30:14Sen. Hickenlooper: Thank you both for being here. I appreciate your willingness to better serve us. Mr. briggs, congress created the sba so it could promote access to capital for small businesses. When I was governor, in a different lifetime, we did what we called the bottom of the economic plan but one of the five main things that every part of the state cities we need better access to capital.
▶ 1:30:43Sen. Hickenlooper: I think that is why congress appropriates money to sba programs, to get access to capital. In the last few months the present administration has tried to restrain those funds, frozen money that congress appropriated, and tried to shut down agencies we created through law. I'm worried that the funding for small businesses will disappear.
▶ 1:31:11Sen. Hickenlooper: I want to make sure you are willing to do everything you can to running the sba in line with the law including appropriations as congress intended.
▶ 1:31:21Mr. Briggs: Thank you for the question. If confirmed I will uphold the law and impartial manner.
▶ 1:31:29Step -- Sen. Hickenlooper: Small business owners face a range of challenges and barriers and stuff, until you have done it, it took me two years to open my first restaurant and raise the money. Those barriers change over time and evolve.
▶ 1:31:49Step -- Sen. Hickenlooper: It is important we stay on top of this evolving small business landscape and make sure we are understanding trends like ai, changes in the lending market, that we are recognizing how they affect entrepreneurs and change the access to capital. In your view, what developments in the small business environment should be be focusing on trying to understand
▶ 1:32:11Better Mr. Mulligan: -- how would you use your office of advocacy to make sure congress, and the sba, stay informed?
▶ 1:32:21Mr. Mulligan: Thank you for the question. I agree 100%. The small business economy changes fast. It has been changing fast in recent times and that means the data we have, is obsolete. You want access to new data that reflects the current situation. We mentioned ai as a factor, different types of employment relationships are evolving over time.
▶ 1:32:48Mr. Mulligan: One of the great things about the office of advocacy is even before there was a regulatory flexibility act, congress understood the issue of measurement and created the office to have an office of economic research and I think a lot of the members to this day are relying on the small business numbers to come from the office and it would be a priority not just because I have been an economic researcher for many years, but a priority to make sure the data reflect the
▶ 1:33:20Mr. Mulligan: Current situation.
▶ 1:33:22Sen. Hickenlooper: I told my staff all the time that information is power. The more people can put it to use like small entrepreneurs, the better off we are. Mr. briggs, small businesses in indian country face unique challenges. That is no surprise. The landscape is in many cases more challenging in a variety of ways.
▶ 1:33:46Sen. Hickenlooper: The last congress we worked with senators on both sides of the aisle to create a bill that would codify the sba's office of native american affairs. That bill came out of this committee with 18-one vote.
▶ 1:34:06Sen. Hickenlooper: If confirmed, are you willing to commit to doing everything you can or aggressively try to see if, if we make sure the office of native american affairs has the resources it needs to try to support indian entrepreneurs who often have more difficult access to capital than anyone else?
▶ 1:34:27Mr. Briggs: Thank you for the question. I'm aware of the challenges facing the native american community. My sister worked in a reservation in new mexico and told me of the challenges facing the particular community. I commit to looking at this legislation and working with your office and the committee on this issue as part of, if I'm confirmed by the senate.
▶ 1:34:51Sen. Hickenlooper: In so many ways, the sba is that bastion, that bastion, the place where entrepreneurs can turn. You have to have a little bit of momentum for the sba will answer your call but once you get to that point, the sba can provide solutions and resources to people that when they got that access, I remember when we first
▶ 1:35:23Sen. Hickenlooper: Got our seven a loan ended transformed our business in ways that it would take hours to explain. I'm tremendously respectful of both of you for your effort to help small businesses. They are without question the core of our economy. I yield back to the chair.
▶ 1:35:40Sen. Ernst: That will conclude our questions. If there are no further questions I want to thank Mr. briggs and Dr. mulligan for being with us today and for your willingness to serve. We are going to leave the record open for two days until 5:00 p.m.
▶ 1:36:00Sen. Ernst: On friday, march 14 for members to submit questions for the record and we will keep the record open for two weeks to edit statements and submit letters and other relevant materials. Without objection, so ordered. Mr. briggs and Dr. mulligan, we would appreciate your prompt response to any questions submitted for the record. We require your responses prior to advancing your nominations out of the committee.
▶ 1:36:29Sen. Ernst: With the outcome of the committee on center ownership stands adjourned -- entrepreneurship stands adjourned.