On Tuesday, Rep. Roger Williams (R-TX) held a House Small Business Committee hearing on weaponizing federal resources.
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00:00:00time together. Thanks that we get to live in the greatest country in the history of
00:00:03the world. We pray for all the small businesses out there and all those
00:00:06entrepreneurs that you give them encouragement and wisdom and discernment
00:00:09with all of the decisions they've got to make and we pray for wisdom and
00:00:13discernment for all of us on this committee as well. We're grateful in the
00:00:16name of Jesus. Amen.
00:00:30So good morning everyone and I now call the committee on small business to order.
00:00:44Without objection, the chair is authorized to declare the recess of the
00:00:47committee at any time and we're going to do things a little differently today
00:00:51because we are expecting votes to be called at 1030, so we will do our best to
00:00:56get through opening statements, introduction, witness testimony before we
00:00:59recess to go vote. We will reconvene when votes are complete and begin member
00:01:03questions at that time. I now recognize myself from opening statement. Welcome
00:01:08to today's hearing which will focus on the SBA's memorandum of
00:01:12understanding with the state of Michigan to register voters. I'd like to start off
00:01:16by thanking our witnesses for being here with us today and your input on these
00:01:20important issues is greatly appreciated. This committee is charged with oversight
00:01:24of the Small Business Administration. This is a responsibility that we do not
00:01:27take lightly and today we will look into how much this agency has deviated
00:01:31from the core mission of helping Main Street America. The SBA is tasked with
00:01:36aiding, counseling, and protecting the interests of small businesses across our
00:01:39great nation. Instead of fulfilling these goals, the SBA has entangled itself in
00:01:44electioneering activities not only lack a constitution basis for but also
00:01:48betray the trust and purpose for which the agency was established. This MOU with
00:01:53Michigan demonstrates a gross misalignment of the SBA's priorities.
00:01:57Small businesses have been crushed the past few years of stubborn inflation,
00:02:00high interest rates, and a significant labor shortage. And while all of these
00:02:04issues have been hurting Main Street's ability to thrive, the SBA has decided
00:02:08to dedicate their staff's time and resources to register voters in a key
00:02:12swing state ahead of the 2024 election. Not only does this agreement turn
00:02:17its back on the entrepreneurs that are struggling, but it opens up a whole host
00:02:21of potential conflicts of interest. If a president and their agencies were
00:02:24permitted to freely involve themselves in elections, they would misuse this
00:02:28influence to stay in power. And the American people need to have confidence
00:02:32that agencies are acting to carry out their duties without a fear of political
00:02:36interference. So unfortunately, there is no longer the case and as SBA is
00:02:40planning events around Michigan, the American people are going to be left
00:02:43wondering if the event is only held to register President Biden's target
00:02:47voting or not. Because of the potential to misuse this new power to register
00:02:52voters, the committee immediately has sent letters and started asking
00:02:55questions about how the SBA is carrying out these orders. As we started asking
00:02:59questions, the lack of transparency was astounding. It took the SBA over six
00:03:03weeks to even show us the MOU after their initial press release announcing
00:03:07a new electioneering agreement. And additionally, after an SBA employee was
00:03:11caught on tape bragging about the administrator's campaign activities, they
00:03:16failed to make him available to speak with the committee until we issued the
00:03:19first subpoena in more than a decade from this committee. This committee will
00:03:24not stop calling out of this misuse of power and we use every tool at disposal
00:03:28to get the answers we need from the SBA. I want to thank you all for being here
00:03:32today and I look forward to today's important... Americans need the SBA to
00:03:37stop playing politics and empower more establishments to weather the worsening
00:03:42economic conditions, just like it did for my Goodyear tire dealership so many
00:03:47years ago. Thank you for your time and I'd be happy to answer any questions.
00:03:52Thank you for that and now I recognize Secretary Morales
00:03:57for his five-minute opening remarks. Chairman Williams, Vice Chairman
00:04:04Lueckenbauer, Ranking Member Velazquez, and distinguished members of the House
00:04:08Committee on Small Business, thank you for the invitation to testify today.
00:04:12I'm here to explain my duties as Indiana Secretary of State in the
00:04:17appropriate role of the US Small Business Administration. My name is
00:04:21Diego Morales. I'm proud to be Indiana's 63rd Secretary of State and the first
00:04:27Latino elected to a statewide office in the history of Indiana, and I'm currently
00:04:33the only immigrant elected Secretary of State in the country. I was born in
00:04:39Guatemala and legally immigrated with my family to America. I know some of you
00:04:44share a similar story of humble beginnings like me. I came here knowing
00:04:49zero English and I was embraced by the Hoosier State. Later, with a green card in
00:04:55my wallet, I proudly volunteered and served in the US Army and the Indiana
00:05:01National Guard. I have such a deep pride for my state of Indiana and for our
00:05:06country. As Indiana Secretary of State, I oversee four divisions. I'm here to
00:05:11talk about two of them. I am recognized by Indiana and the federal government as
00:05:17Indiana's chief election officer. It's a title that has significant responsibility
00:05:23to deliver trusted, secure, and efficient elections. Within the first 18 months of
00:05:30my administration, I visited all 92 counties of Indiana. In fact, this year I
00:05:36visited all 92 counties within three months. During each county visit, one of
00:05:42my first stops was to meet with the county clerk. Since the start of my
00:05:47administration, I've been committed to increasing voter turnout and
00:05:51participation. My team and I have blanketed the state with voter outreach
00:05:56efforts, encouraging eligible Hoosiers to get registered to vote. We sponsor
00:06:03hundreds of thousands of voter PSAs across Indiana. We have set up
00:06:08registration booths at state and county fairs, schools, parades, and sporting
00:06:13events, even at the Indy 500. I'm constantly visiting our minority
00:06:19communities, encouraging them to register to vote. Every opportunity we can find, we
00:06:25take it. Business services is another division under my office. Recently, Forbes
00:06:31ranked Indiana as one of the best states to start a business. I firmly believe
00:06:37small businesses are the backbone of our Hoosier economy. Before becoming the
00:06:42Secretary of State, I was a small business owner. My office is a constant
00:06:47resource to make sure when an entrepreneur has an idea, that idea
00:06:52becomes a reality. This summer, my office is launching a new business initiative
00:06:57we're calling Right to Start. This initiative will help promising, deserving
00:07:02businesses get up and running, with a focus on minority, women, and veteran-owned
00:07:08businesses. Our election divisions and business services divisions are vital to
00:07:14our state. They also operate individually, pursuant to Indiana law, the NBRA, and
00:07:21frankly, years of litigation, government agencies must be designated by the state
00:07:26as designated voter registration service agencies to lawfully engage in voter
00:07:32registration activities. Indiana has designated and properly trained and
00:07:37properly coordinates with specific federal agencies which provide nutrition,
00:07:42health, housing, and disability services to clients in Indiana. Respectfully, the
00:07:49U.S. Small Business Administration does not provide any of that to Hoosiers.
00:07:55Thus, the SBA is not at either the President's directive or its own
00:08:01initiative eligible to act as voter service agency in Indiana. Voter
00:08:07engagement is important, but small loans are important too, so it looks like the
00:08:12SBA is siphoning resources from one important aspect to use on another. I
00:08:17certainly believe that Small Business Administration's focus on delivering
00:08:22resources designated by Congress is appropriate. Speaking on behalf of the
00:08:26nearly 7 million Hoosiers, our state acknowledges and appreciates federal
00:08:31collaboration when it comes to supporting taxpayer-funded services if
00:08:36there is respect to state and federal legislative directives. Again, thank you
00:08:42for your leadership and thank you for holding this important hearing.
00:08:47The gentleman yields back. I now recognize Mr. Whitson for five minutes. Chairman
00:08:54Williams, Ranking Member Velazquez, and members of the committee, good morning. My
00:08:58name is Stuart Whitson and I'm the Senior Director of Federal Affairs at
00:09:01the Foundation for Government Accountability. FGA is a nonpartisan,
00:09:05nonprofit organization that seeks to enhance the lives of all Americans by
00:09:09improving welfare, workforce, health care, and election integrity policy at both
00:09:14the state and federal levels. Zuckerbucks was an unprecedented voter
00:09:19registration scheme that disproportionately targeted left-leaning
00:09:22jurisdictions in the lead-up to the 2020 presidential election, especially those
00:09:27located in key battleground states, including Michigan, and it worked. The
00:09:32infusion of cash into certain jurisdictions, those that leaned heavily
00:09:36Democratic, drove up voter turnout in blue districts and allowed partisanship
00:09:41to weasel its way into the one part of elections that is supposed to be
00:09:44nonpartisan. Unfortunately, the Biden administration has doubled down on a new
00:09:49similar scheme that is using the same strategy pioneered through Zuckerbucks,
00:09:53but on a new, unimaginable scale. As we learned in recent months, the Small
00:09:58Business Administration is playing a critical role in helping to carry out
00:10:02this new scheme. So, back in March 2021, President Biden signed Executive Order
00:10:0714019. The order commands the head of every federal agency to develop a plan
00:10:12to do two things, promote voter registration and promote voter
00:10:18participation. The order also commands all federal agencies to solicit and
00:10:22support, quote, approved third-party organizations to allow them to use
00:10:27federal resources to register and mobilize the voters these groups target.
00:10:32So, which groups will receive this special approval? We don't know because
00:10:37the Biden administration refuses to disclose the list or even the criteria
00:10:42for approval, not only to FGA, but to the dozens of members of Congress who've
00:10:46demanded answers as well. What little we do know is deeply concerning. So, this EO
00:10:52is known as Bidenbucks because it is Zuckerbucks on steroids. Instead of
00:10:56Mark Zuckerberg, it's President Biden, and instead of 400 million dollars, it is
00:11:01the unlimited power, resources, and reach of the federal government and its
00:11:05offices located in every state across the country, including those of the SBA.
00:11:09So, here's some of what we know so far. Back in March of this year, the SBA
00:11:13announced a new agreement it had made with the Michigan Department of State in
00:11:17response to the Bidenbucks executive order to, quote, promote civic engagement
00:11:22and voter registration in Michigan. So, not just registering more voters, but
00:11:27actually helping to turn them out to vote. Campaigns call this a get out the
00:11:32vote effort. This, quote, first-of-its-kind collaboration will include a new effort
00:11:38for the SBA to drive individuals visiting its website to a new site where
00:11:43visitors can register to vote, but they don't plan to stop at online voter
00:11:47registration. According to MDOS, the SBA's Michigan
00:11:51field office may also allow MDOS officials to conduct in-person voter
00:11:55registration at the SBA's small business outreach events. So, obviously, there are
00:12:00a number of factors surrounding this new SBA effort that draw into question the
00:12:04true motivations behind this new partnership between Michigan's highly
00:12:08partisan Secretary of State and the SBA. First, the complete lack of transparency
00:12:14by the Biden administration surrounding the Bidenbucks order and how precisely
00:12:18it is being implemented in the states. Second, the fact that this new
00:12:22unprecedented SBA partnership is being carried out in Michigan, a key
00:12:27battleground state. Third, the recently uncovered evidence revealing that the
00:12:32Biden political appointee currently leading the SBA may have violated
00:12:36federal law by using her position and federal taxpayer resources to indirectly
00:12:41campaign for President Biden. And fourth, the timing of the announcement, mere
00:12:46months before the upcoming election. The worry is that this isn't about
00:12:50registering small business owners across the state of Michigan, but rather this is
00:12:54about using generous business startup and other grants to lure targeted groups
00:12:59of voters, those the left believes are more likely to vote for the current
00:13:02president, to SBA's website and to in-person outreach events hosted in
00:13:07Democratic strongholds, all to help register and mobilize these voters ahead
00:13:12of the 2024 election. In other words, this appears to be a get out the vote
00:13:16effort aimed at directly benefiting the Biden campaign at the expense of the
00:13:21American taxpayer and the small businesses the SBA is supposed to serve.
00:13:26So with that, I thank you for the opportunity to testify today and I look
00:13:29forward to answering your questions. Gentlemen, he goes back. I now recognize
00:13:33Miss Danette's for her five minute opening remarks.
00:13:37Good morning, Chairman Williams, ranking member of Alaska's and members of the
00:13:42committee. Americans are concerned about the health of our democracy and rightly
00:13:47so. Ever since our nation was founded in the Declaration of Independence on the
00:13:53idea that the government is legitimate only when it rests on the consent of the
00:13:58governed. We have struggled over decades and centuries to live up to that ideal
00:14:03to make sure that our ability to have self-government extends to all eligible
00:14:09Americans. All of us, whatever our view, should fight for elections that are free
00:14:17and fair and secure. At issue in this hearing is one small way to address that
00:14:23struggle. Voter registration is the crucial first step toward casting a
00:14:28ballot and by proxy ensuring that our government is representative of the
00:14:32American people. Except in North Dakota, if an American is not registered, he or
00:14:39she cannot vote. Unfortunately, U.S. voter registration and participation rates are
00:14:45notably low, especially compared to our peer nations. Congress has long sought to
00:14:50improve voter registration access and has even involved federal agencies in
00:14:55this crucial national goal through a string of federal laws going back to
00:14:591955. Most notably, in the National Voter Registration Act of 1993, or NVRA,
00:15:06Congress provided for voter registration services at a wide array of state
00:15:12government agencies and authorized federal agencies to do the same. Executive
00:15:17Order 14109 implements this federal goal by requiring federal agencies, upon
00:15:23request of state election officials, to provide the same number of federal
00:15:28election officials to provide the same voter registration services state
00:15:33agencies do. Such agency-based registration allows Americans of all
00:15:38walks of life access in the normal course of their lives. It is available
00:15:43year-round, regardless of political orientation, from the government
00:15:47locations or websites people already visit. We should be celebrating that the
00:15:51federal executive branch is finally playing its appointed role under a
00:15:55whose instruction has long been ignored. And because this is a governmental
00:16:00service, it is avowedly nonpartisan. In fact, the nonpartisan nature is protected
00:16:07through the NVRA and other federal laws like the Hatch Act. The intergovernmental
00:16:12agreement in this case also prohibits partisan conduct by any SBA staff in
00:16:17Michigan. The executive order is not the first federal executive action to
00:16:22facilitate voter registration access for federal agency
00:16:27constituents. In September 2008, the Bush Veterans Health Administration issued a
00:16:33directive to ensure patients in residential VA health facilities access
00:16:38to voter registration services. That policy was updated in 2014 and in 2019
00:16:44during the Trump administration. This is regular, normal, and appropriate activity,
00:16:50and it is exactly what Congress intended when it passed the NVRA with a
00:16:54bipartisan vote. It intended the nonpartisan offer of voter registration
00:16:59application opportunities at agencies where American citizens interact, and it
00:17:04intended federal agencies to play a role. This committee should not get in the way
00:17:10of small business owners having a voice in the policies that affect them. Small
00:17:14business leaders think democracy is good for business. The SBA's mission is to aid
00:17:19counsel, assist, and protect, insofar as it is possible, the interest of small
00:17:24business concerns. This is what is happening here. Because the Michigan SBA
00:17:30will provide access to voter registration application opportunities,
00:17:33small business owners who are not registered to vote can add their voices
00:17:38to shape our government, including policies related to small business
00:17:42concerns. The executive order takes critical steps to improve access to
00:17:47nonpartisan voter registration opportunities and reliable voting
00:17:51information. It is the opposite of partisan electioneering. The freedom to
00:17:57vote in America is under escalating attack, a national issue that requires a
00:18:02national response. Everyone has a role to play, including the SBA. In closing, rather
00:18:10than criticizing governmental attempts to ensure American citizens have access
00:18:14to voter registration applications, Congress should shore up democracy,
00:18:18including by passing the Freedom to Vote Act, which would modernize our voter
00:18:23registration systems and set other baseline national standards for voting
00:18:27and elections, along with the John Lewis Voting Rights Act, which would restore
00:18:32the strength of the Voting Rights Act of 1965. Thank you for having me here today.
00:18:36He yields back. Thank you. Now, as I mentioned at the beginning of the committee, we'll now
00:18:41take a brief recess until 1115, and we'll reconvene to begin
00:18:48member questions. We've been asked to go vote, so we'll take a recess right now.
00:27:41We'll take a recess until 1115, and we'll reconvene to begin member questions.
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02:22:01We'll take a recess until 1115.
02:22:11We'll take a recess until 1115.
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02:37:21Thank you very, very much.
02:37:24And please understand and know that you will be missed
02:37:28and your voice will be missed.
02:37:30And thank you for never being afraid to stand up
02:37:33for what you believe in and to speak out about.
02:37:36Thanks so much.
02:37:39Once again, today we are marking up a state
02:37:43in the Foreign Operations Bill
02:37:45that resurrects the doomed isolationism
02:37:50of the early 20th century.
02:37:52Just a few months ago, after Democrats and Republicans
02:37:55voted for final bipartisan 2020 for funding bills,
02:37:59the majority proposes that we decimate
02:38:02the State and Foreign Operations Bill
02:38:05with a 12% cut from where we just have been in March.
02:38:11Let's take stock for a moment.
02:38:13Around the globe, America's adversaries threaten
02:38:16the peace and the prosperity of the free world.
02:38:19Wars in the Middle East and Europe
02:38:21and humanitarian crises on nearly every continent
02:38:24call for American leadership.
02:38:27And not since the Cold War have our diplomatic influence
02:38:31and soft power been more critical
02:38:33to keeping Americans safe.
02:38:36Yet, House Republicans have proposed a bill
02:38:39that would diminish America's world leadership
02:38:42and obstruct our ability to support our allies,
02:38:45deter our adversaries, surpass our competitors,
02:38:50wage our influence, and to continue leading the free world.
02:38:55We must lead the free world.
02:38:58America is still the indispensable nation
02:39:01for any serious global action.
02:39:04But whether we are talking about our diplomatic strength,
02:39:07economic investments, or humanitarian assistance,
02:39:11this bill unravels the hard-fought credibility
02:39:14and influence we have earned to be a global leader.
02:39:20This bill threatens our national security.
02:39:22It threatens women's health globally.
02:39:24It hampers our response to the climate crisis.
02:39:27It undermines our diplomatic core
02:39:29by underfunding the State Department and USAID
02:39:33and completely blocks support
02:39:35for the United Nations Relief and Works Agency,
02:39:39leaving behind some of the most vulnerable people
02:39:42facing the most unthinkable humanitarian disasters
02:39:46around the world.
02:39:48The majority is yet again diminishing
02:39:51the global standing of the United States.
02:39:53What we stand for and what our values are
02:39:56for our own people and for people around the world
02:39:59who look to America, the world's largest economy
02:40:03and oldest constitutional democracy,
02:40:06for inspiration and for hope.
02:40:09This bill abdicates U.S. leadership
02:40:11in the United Nations and other multilateral
02:40:14and international institutions
02:40:16by not including any funding for the U.N. regular budget,
02:40:21the U.N. development program, U.N. women, and UNICEF.
02:40:26When it comes to international cooperation,
02:40:29withdrawing from these organizations
02:40:32allows our competitors and our adversaries
02:40:35to take our place, replace our influence.
02:40:40And by short-changing USAID
02:40:42at a time when a historic number of people
02:40:45are facing conflict and instability,
02:40:48we are abandoning the most vulnerable people in the world
02:40:52and failing to live up to America's ideals.
02:40:56I am awestruck that the majority is once again
02:40:59dragging us through this same ridiculous song and dance
02:41:03on these appropriations bills
02:41:05that lead to chaos, division, and shutdown threats.
02:41:10As I said throughout last year,
02:41:12and as we proved together this spring,
02:41:14final spending bills will be the product of negotiations
02:41:18between Democrats and Republicans
02:41:20in the House and the Senate.
02:41:23The majority's top-line funding level
02:41:25falls short of the American people's needs,
02:41:28short of what both parties just agreed to in March.
02:41:32Eighty percent of the Appropriations Committee
02:41:35voted to pass the final 2024 Appropriations Acts.
02:41:41Our starting point for 2025 must provide at a minimum
02:41:45a 1% increase in defense and non-defense funding,
02:41:50consistent with the framework
02:41:52set in the Fiscal Responsibility Act
02:41:55that Republicans demanded.
02:41:58Democrats will accept nothing less
02:42:02than a 1% increase over 2024
02:42:06in non-defense and defense funding.
02:42:09That is what the law provides for.
02:42:12For the sake of our national security,
02:42:15for women's health globally,
02:42:17and our response to a climate crisis,
02:42:20Republicans must abandon their reckless and bipartisan path,
02:42:25join Democrats at the table to govern,
02:42:28and it is time for the majority to govern.
02:42:31For all of these reasons, I cannot support this bill.
02:42:35Thank you, and I yield back.
02:42:37Thank you so much.
02:42:39Do any other members wish to make opening remarks?
02:42:42Yes, the dean of the House, you recognize her.
02:42:44I just wanted to join the chorus
02:42:49of members of this subcommittee
02:42:52toward you, Mr. Chairman, and your cohorts
02:42:57for putting together a great bill.
02:43:00This is a really good one.
02:43:02I'm especially thankful
02:43:05that you included numerous provisions
02:43:08relating to fentanyl.
02:43:11Folks, we're losing 100,000 of our fellow citizens every year
02:43:19through the use of fentanyl,
02:43:23and especially young people.
02:43:26I know that the fight will take a long time to mature,
02:43:32but your bill smooths the way
02:43:35for international efforts
02:43:38to stop the flow of fentanyl across our borders.
02:43:42Unfortunately, most of the fentanyl
02:43:47is coming from the border,
02:43:51where we have not enforced the law
02:43:57on keeping fentanyl from our young people.
02:44:02It's the border.
02:44:04And for gosh sakes, that's pretty simple.
02:44:11And your bill is an effort to stem the flow,
02:44:16and I thank you for it.
02:44:18Congratulations.
02:44:20Yes, gentleman from Florida.
02:44:28I want to thank all our leaders,
02:44:31some more dramatic than others.
02:44:34Barbara, thank you so much, Representative Lee,
02:44:37for all your years of service.
02:44:40Just quickly about this bill.
02:44:42It's sort of a heartbreaking bill for me
02:44:44because I really like parts of it,
02:44:46as I'm sure the chair knows.
02:44:48I'm very appreciative of the support for Israel,
02:44:52and there are other items in here that are very good,
02:44:55but I'm very concerned about what this bill does
02:44:58to women in the world.