WASHINGTON– Today, during the House Small Business Committee hearing “Budgeting for Growth: Testimony from SBA Administrator Kelly Loeffler,” Democratic Members of the Committee pressed Administrator Loeffler on sweeping staff reductions, harmful program cuts, and the Trump administration’s erratic economic policies are impacting small businesses.
During the hearing, Ranking Member Nydia M. Velázquez (D-NY) criticized the administration’s proposed budget for slashing critical SBA programs that serve veterans, women, and underserved entrepreneurs. She also questioned the agency’s capacity to support small businesses amid a 43% workforce cut and the administration’s controversial decision to hand the SBA responsibility for the federal student loan portfolio.
“Small businesses are being crushed—by tariffs, inflation, and an administration that says one thing and does another,” said Ranking Member Velázquez. “Fifty-eight percent say the economy has gotten worse since January. Sixty-six percent say tariffs are hurting them. And nearly 60 percent cite uncertainty as their top challenge. The message from Main Street is clear: they’re struggling, and Washington is making it worse.”
The Trump administration’s FY 2026 budget proposes the elimination of 15 SBA counseling and training programs, including those that serve veterans, women, and underserved communities. Meanwhile, the SBA has moved forward with a plan to cut 2,700 agency staff—nearly half its workforce—without consulting Congress. These cuts come on the heels of a proposed Republican tax bill that could add $2.4 trillion to the deficit, paid for in part by slashing investments in small business programs.
Democrats highlighted that these cuts come at a time when small businesses are already facing major headwinds. Tariffs imposed by the Trump administration have sent costs soaring, with the average U.S. tariff rate now the highest since the 1930s. For small firms that lack the buying power and cash reserves of large corporations, the impact has been especially devastating.
Committee Democrats vowed to continue holding the SBA accountable and fighting to protect the tools small businesses need to survive and grow.
