U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

For sale by the Superintendent of Documents, U.S. Government Printing Office

Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800

Fax: (202) 512–2104 Mail: Stop IDCC, Washington, DC 20402–0001

53–008 PDF 2009

S. HRG. 111–178 

KEEPING AMERICA COMPETITIVE: FEDERAL 

PROGRAMS THAT PROMOTE SMALL 

BUSINESS EXPORTING 

HEARING 

BEFORE THE

COMMITTEE ON SMALL BUSINESS AND 

ENTREPRENEURSHIP 

UNITED STATES SENATE 

ONE HUNDRED ELEVENTH CONGRESS 

FIRST SESSION 

JUNE 30, 2009 

Printed for the Committee on Small Business and Entrepreneurship 

( 

Available via the World Wide Web: http://www.access.gpo.gov/congress/senate 

(II) 

COMMITTEE ON SMALL BUSINESS AND ENTREPRENEURSHIP 

ONE HUNDRED ELEVENTH CONGRESS 

MARY L. LANDRIEU, Louisiana, Chair 

OLYMPIA J. SNOWE, Maine, Ranking Member 

JOHN F. KERRY, Massachusetts 

CARL LEVIN, Michigan 

TOM HARKIN, Iowa 

JOSEPH I. LIEBERMAN, Connecticut 

MARIA CANTWELL, Washington 

EVAN BAYH, Indiana 

MARK L. PRYOR, Arkansas 

BENJAMIN L. CARDIN, Maryland 

JEANNE SHAHEEN, New Hampshire 

KAY HAGAN, North Carolina 

CHRISTOPHER S. BOND, Missouri 

DAVID VITTER, Louisiana 

JOHN THUNE, South Dakota 

MICHAEL B. ENZI, Wyoming 

JOHNNY ISAKSON, Georgia 

ROGER WICKER, Mississippi 

JAMES E. RISCH, Idaho 

DONALD R. CRAVINS, JR., Democratic Staff Director 

WALLACE K. HSUEH, Republican Staff Director 

(III) 

C O N T E N T S 

OPENING STATEMENTS

Page 

Landrieu, The Honorable Mary L., Chair, Committee on Small Business, 

and a United States Senator from Louisiana .................................................... 1 

WITNESS TESTIMONY

Gordon Mills, Karen, Administrator, U.S. Small Business Administration ....... 4 

Kirk, Hon. Ronald, Ambassador, United States Trade Representative .............. 10 

Hochberg, Hon. Fred P., Chairman and President, Export-Import Bank of 

the United States ................................................................................................. 16 

Sefcik, Patricia, Acting Deputy Assistant Secretary, Domestic Operations of 

the U.S. and Foreign Commercial Service, International Trade Administration, U.S. Department of Commerce ................................................................... 25 

Schreiber, Eugene J., Managing Director, World Trade Center of New Orleans ......................................................................................................................... 42

Simek, Diana, Vice President for Business Development, Ark-La-Tex Regional 

Export and Technology Center, Inc., and Manager, Metro/Regional Business 

Incubation, Shreveport, Louisiana ...................................................................... 54 

Castro, Wilma, Owner, International Export Sales, L.L.C., on behalf of the 

Louisiana District Export Council, St. Rose, Louisiana ................................... 62 

Hingle, Jerry, Executive Director, Southern United States Trade Association . 67 

ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED

Castro, Wilma 

Testimony .......................................................................................................... 62 

Prepared statement .......................................................................................... 64 

Hingle, Jerry 

Testimony .......................................................................................................... 67 

Prepared statement .......................................................................................... 69 

Hochberg, Hon. Fred P. 

Testimony .......................................................................................................... 16 

Prepared statement .......................................................................................... 19 

Kirk, Hon. Ronald 

Testimony .......................................................................................................... 10 

Prepared statement .......................................................................................... 14 

Landrieu, Hon. Mary L. 

Opening statement ........................................................................................... 1 

Questions for the record ................................................................................... 88 

Mills, Hon. Karen Gordon 

Testimony .......................................................................................................... 4 

Prepared statement .......................................................................................... 7 

Schreiber, Eugene J. 

Testimony .......................................................................................................... 42 

Prepared statement .......................................................................................... 45 

Sefcik, Patricia 

Testimony .......................................................................................................... 25 

Prepared statement .......................................................................................... 27 

Simek, Diana M. 

Testimony .......................................................................................................... 54 

Prepared statement .......................................................................................... 56 

(1) 

KEEPING AMERICA COMPETITIVE: FEDERAL 

PROGRAMS THAT PROMOTE SMALL 

BUSINESS EXPORTING 

TUESDAY, JUNE 30, 2009 

UNITED STATES SENATE, 

COMMITTEE ON SMALL BUSINESS

AND ENTREPRENEURSHIP, 

New Orleans, LA 

The Committee met, pursuant to notice, 1:06 p.m., in the Port of 

New Orleans Auditorium, First Floor, 1350 Port of New Orleans 

Place, New Orleans, Louisiana, Hon. Mary L. Landrieu (chairman 

of the committee) presiding. 

Present: Senator Landrieu. 

OPENING STATEMENT OF THE HONORABLE MARY L. LANDRIEU, CHAIRMAN, AND A UNITED STATES SENATOR FROM 

LOUISIANA 

Chair LANDRIEU. I would like to thank our witnesses who are 

here today. I am honored as the Chair of this committee that you 

would accept the invitation to testify. 

I also want to particularly thank the Port of New Orleans for 

hosting us. This is a very appropriate venue for the subject of this 

hearing on literally the shores of the greatest river system in North 

America. Let me thank the port and all of its employees for hosting 

us today. 

As I said, it is no coincidence that we chose this location as the 

site of our hearing. This port sees more goods leaving its docks 

each day than almost anywhere else in the nation. It pumps $882 

million into Louisiana’s economy and sustains more than 160,000 

jobs. 

The reality is, Louisiana’s ports, not just the Port of New Orleans, but the combined sister ports of South Louisiana, are America’s ports and the gateway to the world. We are literally a main 

artery, if not the main artery, of our nation’s commerce. We are 

home to five of the country’s top 13 ports exporting more than $42 

billion in goods last year alone. We send everything from sugar to 

oil and receive steel and goods from all over, over 200 countries 

worldwide. 

But the recession has caused challenges. The recovery is still underway from Katrina, Rita, Gustav, and Ike, major storms that 

have had a major impact on this region. We are still having challenges associated with those events. With cash registers not ringing 

like they used to, exporting has become one solution for small busiVerDate Nov 24 2008 15:23 Dec 07, 2009 Jkt 053268 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 C:\DOCS\53008.TXT SHAUN PsN: DPROCT
2 

nesses looking to survive and grow, like Xenetech, who is here 

today with us. 

Guy Barone, I had the pleasure of speaking with him last night. 

Guy is the Chairman is the State’s District Export Council. With 

the help of SBA and other Federal programs, Guy’s family-owned 

business of just 21 employees ships goods to nearly 7,000 customers around the world, customers as diverse as Carnival Cruise 

Lines, NASA, and the Egyptian Army. Most recently, he supplied 

the engraving equipment to the company that provided the national championship trophy to our LSU Tigers last week. We are 

very proud of our Tigers and very happy the business that manufactured the trophy is right here in Louisiana. 

Xenetech and small businesses like it across the country have 

not only used exporting to weather the economic storm, they are 

proving that whatever helps our entrepreneurs helps our entire 

economy. Last year, $70 billion in exports maintained or created 

600,000 high-paying American jobs. One of the successful exporters 

here today is Ralston Pittman Cole, who was recently named Louisiana’s Small Business Exporter of the Year for his work at EMD 

Services International. Ralston, Guy, and others like them are 

helping our country grow out of this recession. 

Small businesses make up nearly 85 percent of the exporters in 

the State, 97 percent State-wide. I want to call your attention to 

Chart Number 1, which shows how we have got a long way to go. 

The percentage of small businesses that export are one percent of 

all small businesses, so they are in the mighty few. That gives us 

a great opportunity to grow and to help small businesses become 

the exporters that we believe they can be. 

The number of big businesses in the other chart are represented 

in three percent. The number of small businesses that export in the 

country, according to our data, is 239,000. So small businesses 

make up the greater portion of exporters, but they are still just a 

small percentage of small businesses that are actually exporting. 

So there is great room for growth and that is part of what our field 

hearing is about today. 

These small businesses have told me that the programs and services of the Small Business Administration and other Federal agencies are helpful, but we can do more. They have told me that better 

coordination and improvement of our programs are needed. 

But perhaps most importantly, we need to understand the root 

of the problem. The tools we have today help solve problems caused 

by inequitable rules created during trade negotiations. These barriers, like burdensome regulations, excessive reporting requirements, and unfair tariffs, force small businesses to act like big 

businesses, which they can’t. They can be a business. They can be 

successful. They can’t be big if they are small. In healthy times, the 

successful business can try to handle these situations. But when a 

devastating storm or groups of storms or levees that break occur, 

or when a global recession sets in, these challenges become almost 

insurmountable. 

So going forward, we need to be more proactive by ensuring that 

unfair trade rules and regulations don’t stand in the way of our 

small entrepreneurs. This is why we are here today, to discuss 

these barriers and propose possible solutions. 

3 

Some of the problems I have seen myself, and I hope some of the 

witnesses here will elaborate on some of the challenges and express 

their views about some of the proposed changes in terms of their 

new advocacy positions. With more than 19 Federal agencies involved in trade, small exporters often don’t know where to turn for 

help or even that help is available. It is time we bring small business trade to the forefront. 

My committee has direct jurisdiction over one of these agencies, 

the Small Business Administration. I have been pleased that Administrator Mills has been with me all day this morning and part 

of yesterday touring the region and I will be anxious to hear more 

from her in just a moment. But I have been extremely impressed 

with her commitment and her concern and her ideas about what 

can be done through the SBA. 

We will also take a hard look at other agencies that are here representing Commerce and independent agencies that I would like to 

work strongly with them, as well. 

I, along with my Ranking Member on the committee, Senator 

Snowe, and Chuck Schumer from New York, who has also been 

very active in this area, have called for an Assistant Trade Representative focused solely on small business within the Office of our 

U.S. Trade Representative, and we are honored to have the Honorable Ron Kirk with us today. This advocate would be in the room 

supporting small business during trade negotiations. We are hopeful that we could move in that direction. 

It is also refreshing to have a strong partner in the White House 

and it has been a pleasure to work with the Administrator, as I 

have said before, earlier in my testimony. I am also looking forward to working with my good friend, Fred Hochberg, who helped 

to run this Department and now is heading up the Export Bank 

of the United States. 

So we have a tremendous panel to discuss this issue with, and 

a representative from the Department of Commerce. 

But in conclusion, let me say that, ultimately, this hearing is 

about exporting. It is about export opportunities for business. It is 

about export opportunities for Main Street businesses, businesses 

that with the new technology that we have, this has become a real 

option. Twenty years ago, it probably wasn’t possible. But with new 

technologies today and the kinds of new opportunities that small 

businesses can look to, and because of the challenges here at home 

with their own markets and their own neighborhoods and their 

own communities, small businesses are looking other places in the 

world for opportunities. And I think, ladies and gentlemen, if I can 

say, if we do our jobs the very best we can, it can bring hope and 

opportunity for the small businesses in our country. 

I would like to introduce, if the staff will give me the introduction list, we will introduce our first panel of witnesses today. First, 

Karen Mills, Administrator of the Small Business Administration. 

Ms. Mills directs an agency of over 2,000 full-time employees, but 

her network is quite extensive and hopefully she will spend a moment talking about that in her testimony today. She comes fully 

prepared for this job, tapped by the President to run, I think, one 

of the most important agencies of the Federal Government right 

now and we are pleased to have Ms. Mills with us. 

4 

The Honorable Ron Kirk—he has so many titles, I don’t know 

what to call him, Mayor, Ambassador, and now Trade Representative for the United States of America. He is one of the President’s 

top appointees in this regard and we are very pleased to have you, 

Ambassador Kirk, with us. 

Fred Hochberg, as I said, is Chairman and President of the Export–Import Bank of the United States. We are just excited to have 

him heading up this exciting agency. He has been involved in business, government, and philanthropy for many years and was the 

former Deputy and Acting Administrator of the SBA. So he and 

Ms. Mills will have a great deal in common and a lot of ideas to 

share, having both served in that capacity. 

And Patty Sefcik is standing in and doing a wonderful job for the 

Commerce Secretary, who called to say he was sorry he could not 

be here, that other business kept him away. But as the Acting Deputy Assistant Secretary for Domestic Operations of the United 

States and Foreign Commercial Service—big title—she is with us 

today and oversees the Export Assistance Centers operating in 48 

different States. 

So with that, let me turn it over to Ms. Mills. We look forward 

to your testimony this morning. 

STATEMENT OF HON. KAREN GORDON MILLS, 

ADMINISTRATOR, U.S. SMALL BUSINESS ADMINISTRATION 

Administrator MILLS. Thank you very much, Senator Landrieu. 

I have to say that the people of Louisiana and all of America’s 

small business community are very fortunate to have such a strong 

advocate as you are in Washington and in the U.S. Senate. 

I want to thank you also for the past couple days. We have had 

a chance to see firsthand what is going on in this continued but 

difficult redevelopment effort here in this region and to visit with 

small businesses and entrepreneurs, Main Street entrepreneurs in 

a gas station, one of the first that has come back to a devastated 

community and has provided some of the linkages to grow that entire revitalization effort. We have seen young, vibrant entrepreneurs. But there is much work still to be done here and we are 

very happy to work in this community and to be part of that effort. 

It is also a pleasure to be here with Ambassador Ron Kirk and 

Chairman Fred Hochberg and Acting Deputy Assistant Secretary 

Patty Sefcik at the U.S. Department of Commerce and everyone 

else who has joined us today. Truly, it is going to take all of us 

working together to keep America competitive, as the title of this 

hearing suggests. Madam Chair, I am pleased to share the SBA’s 

efforts to help small businesses compete in the global marketplace. 

The SBA provides access to capital for small businesses on Main 

Street and to some of the country’s high-growth, high-impact small 

businesses. The SBA has a portfolio of loans and loan guarantees 

of more than $80 billion. We have 68 district offices, including one 

here in New Orleans. We have more than 2,000 employees, as well 

as 1,200 stand-by trained employees who can be deployed to communities affected by disaster. And we also have 18 Senior International Trade and Finance Regional Managers across the country. 

Our partners are part of our important network and they include 

over 900 Small Business Development Centers—and we have 11 

5 

here in Louisiana—and more than 100 Women’s Business Centers—and we have two here in Louisiana, as well. We have 350 

chapters of our mentoring group, called SCORE, and they have five 

chapters here in Louisiana. So all told, as you describe, we have 

a very broad bone structure throughout the United States which 

includes about 14,000 affiliated SBA counselors. 

We know that this is a difficult time for small businesses to gain 

access to capital, so since the Recovery Act passed, we have redoubled our efforts to put more money into the hands of entrepreneurs 

and small business owners. We have done a number of things. We 

have raised the guarantee on our 7(a) loans to 90 percent and we 

have reduced or eliminated the fees on our flagship 7(a) and 504 

loan programs. And as a result, the loan volumes in these programs are up more than 35 percent compared to the weeks before 

the Recovery Act. 

In addition, importantly, we have brought nearly 600 banks and 

credit unions back to the SBA programs, nearly half of whom had 

not participated since 2007. For Louisiana, this has resulted in $55 

million in lending support for nearly 200 small businesses throughout the State, and I want to give you just two quick examples to 

bring this alive. 

In West Monroe, Sawyer Industrial Plastics has provided plastic 

repair parts for the paper industry for 32 years and the owner was 

shifting his strategy to a new market when his conventional credit 

was canceled. So he was able to get an SBA loan of $700,000, 

which was a lifeline, and the fee savings from the Recovery Act allowed him to add an employee to help with the new products. 

The second example is just north of here, in Mandeville, Woolf– 

Harris Plumbing bought a new building, but they were left short 

of cash, and even though the demand for their products and services was high, with the increased guarantee from the SBA, a local 

bank was able to extend $250,000 for working capital through a 

7(a) loan. Nationwide, about 20 percent of these loans have gone 

to minority-owned businesses, 19 percent have gone to womenowned businesses, and in fact, the SBA is three to five times more 

likely to make loans to women- and minority-owned businesses 

than conventional lenders. 

In addition, just two weeks ago, we added another tool to the 

toolbox, a brand new program called America’s Recovery Capital, or 

ARC loans. These loans are providing the relief that many viable 

but struggling small businesses need. ARC loans are 100 percent 

guaranteed by the SBA. They are for up to $35,000, over six 

months, interest-free to borrowers, and they have no repayment for 

12 months after the final dispersal. 

The Recovery Act also provides billions of dollars in contracting 

opportunities. We are responsible at the SBA for making sure that 

small businesses have the opportunity to deliver at least 23 percent 

of Federal contracting. We see this as a win-win situation. Small 

businesses benefit by getting increased volume and sales, and the 

Federal agencies and the taxpayers benefit because they are working with the most innovative companies, often with a direct line to 

the CEO. 

All of these efforts of the Recovery Act are aimed at building a 

stronger foundation for small businesses to grow and to explore 

6 

areas like the one we are here to talk about today, international 

trade. 

Overall, small businesses accounted for more than $500 billion 

last year in export sales, or nearly 30 percent, while it is still difficult for many small businesses to know exactly what steps to take 

to reach potential export markets. In fiscal year 2008, the SBA facilitated more than 3,300 loans for exporters, and in the Louisiana 

and Texas region, we were able to provide training and counseling 

to more than 300 lenders and more than 600 small business owners. We have international trade loans, which I will describe in a 

moment, but the Recovery Act has allowed us to raise the guarantees on those loans, as well, across all our programs and to waive 

the up-front fees for borrowers on loan terms of greater than 12 

months. 

Some examples of our program: We have the Export Working 

Capital Program, and that loan is coordinated through our SBA 

staff that work in collaboration with the Department of Commerce 

at 18 U.S. Export Assistance Centers around the country, and we 

have a growing number of preferred lenders to whom we delegate 

the authority to process these loans directly to our loan processing 

center in Sacramento. These loans are important because small 

businesses often need an initial line of credit for suppliers, inventory, or production of export goods, especially when the first big 

order from abroad comes in. The SBA provides nearly $1.7 million 

for these loans and we can also co-guarantee with the Export–Import Bank on loans of up to $2 million. 

Another key program is the Export Express loan, which can be 

up to $250,000 and can usually be approved within one or two days 

by an SBA Express lender. These loans can be used to enable a 

small business company to prepare for exporting. For example, it 

can help with the translation of a business website or marketing 

material and it can also help them participate in trade missions. 

So far for this fiscal year, the SBA has guaranteed 598 loans to 

exporters and we are working tirelessly to continue our outreach 

and advocacy for small business exports, both here in Louisiana 

and throughout the nation. As part of that, I am actually pleased 

to say that we are in the process of hiring our newest Senior International Trade and Finance Manager, who will be permanently assigned to the U.S. Export Assistance Center here in New Orleans. 

With all these efforts, I am pleased to be working with Ambassador Kirk, Chairman Hochberg, Secretary Locke, Acting Deputy 

Assistant Secretary Sefcik, and our other agencies who are represented by the Trade Promotion Coordinating Committee. This is 

important because we do have a group and we do work very hard 

together to make sure that the Federal Government’s programs are 

coordinated and accessible to small businesses and other exporters. 

Through our collaborations, we can ensure that small business will 

build a stronger foundation of American competitiveness while creating well-paying jobs in the 21st century. 

Thank you. 

[The prepared statement of Administrator Mills follows:] 

7 


Insert offset folio 1 here 53008.001
8 


Insert offset folio 2 here 53008.002
9 


Insert offset folio 3 here 53008.003
10 

Chair LANDRIEU. Thank you, Administrator Mills. You can illuminate one of my questions, which was when is that representative 

going to be appointed, so I am glad to know that the time is just 

right around the corner. 

Mr. Kirk. 

STATEMENT OF HON. RONALD KIRK, AMBASSADOR, UNITED 

STATES TRADE REPRESENTATIVE 

Ambassador KIRK. Well, I would like to join the Administrator, 

first of all, in, Madam Chairman, thanking you for your wonderful, 

tenacious advocacy on behalf of small business, but also, being a 

neighbor in Texas, there is a wonderful kinship between Texas and 

Louisiana, and even though I am sitting here as a U.S. Trade Representative, I am also a distinguished graduate of the University 

of Texas and was going to serve as President–Elect of the Texas 

Exes, but I will happily say ‘‘Go Tigers’’ today. [Laughter.] 

Chair LANDRIEU. Thank you. 

Ambassador KIRK. Not that happily. [Laughter.] 

Chair LANDRIEU. Begrudgingly. 

Ambassador KIRK. It was a great series. 

Chair LANDRIEU. It was a great game. 

Ambassador KIRK. But thank you so much for your advocacy on 

behalf of small businesses and for the region. 

I may be able to abbreviate my presentation. You jokingly referred to my number of titles as Mayor, Secretary and Ambassador, 

and I think I would have to refer to you as Senator and Chairwoman and perhaps Ambassador Pro Bono. You did a fairly great 

job of explaining the importance of small businesses to the growth 

of trade and exporters, and in fact, there are almost 230,000, 

240,000 small businesses that are involved in export and they do 

represent 90 percent of our exports. My experience as mayor tells 

me that is a great growth opportunity for our country. 

As we were talking over lunch, all of us throw these statistics out 

so casually and easily about small business being the background, 

particularly of our towns and our cities and our urban areas. But 

as your pie chart shows, there is an extraordinary opportunity for 

growth. If we can invest in those small businesses and take them 

from having 70 employees to 140, or take them from 25 to 50 and 

duplicate that not only up and down the Gulf Coast and the Mississippi River that feeds your important port, but all around the 

country, I think we can readily calculate and easily calculate the 

value that would be to America and our economic recovery. So I am 

pleased to work with you in this endeavor and to work with our 

colleagues here, as well. 

So in that vein, I want you to know it is important. I know that 

you and Senator Snowe, in particular, have strongly advocated for 

the creation of an Assistant USTR for Small Business, but I want 

you to know the importance it is to us. We are the smallest of the 

agencies within the Executive Office of the President, with only 227 

employees, and so we would welcome all of the assistance that we 

can get. But I am also sobered by the reality that one person doing 

that job may not be as effective as making sure that we have maintained a focus on small business throughout our agency. And I 

want you to know it is one of our highest priorities. 

11 

Small business cuts across all of the work within the United 

States Trade Representative, so even though there may not be one 

person dedicated, it comes up in everything we do—in the negotiation of our trade agreements, in our enforcement, in our intellectual property rights work, and it is important enough that I have 

already had and invited to our office Commerce Secretary Locke to 

strengthen the ties that we have with Commerce through the office 

represented by Ms. Sefcik and others. SBA Administrator Mills 

came over last week and brought her team, because I want to make 

sure that we are doing everything humanly possible to take the 

burden off that small business person to have to weave their way 

through those 19 Federal agencies and that we can work collaboratively perhaps and be a single point of entry to make sure that 

we work with small businesses to help them understand the critical 

role that they can play in exporting. 

You talked about the importance of the port here to New Orleans 

and Louisiana. We know that more than 2,300 Louisiana businesses exported goods, according to the most recent data that we 

had, with small businesses accounting for more than a third of 

your State’s total exports. And work at the Port of New Orleans 

here, as you mentioned, supports over 160,000 high-quality jobs, 

and we have the data now that we know that the jobs that are related to exporting and trade tend to pay anywhere from 15 to 20 

percent higher than other jobs in our economy. So small businesses 

that are involved in exporting can be a great way to help rebuild 

the Gulf Coast, but also sustain those families, as well. And when 

we improve business access to new markets overseas, which is one 

of our top priorities, we are helping to grow good jobs here at home 

in America. 

You mentioned Mr. Cole, and we were pleased to be able to help 

join in congratulating him as your Louisiana Small Business Exporter of the Year. I also had the great joy in joining with Administrator Mills at the State Department last month in which we highlighted and feted those small businesses across the country that 

have been successful in exporting. And we want to continue to 

work with you and the Administrator to make sure that we are 

opening new markets, but doing so in a way that we meet those 

challenges that you referenced in dealing with non-tariff barriers, 

customs, regulations, and others that for large businesses are an 

annoyance, but for small business can in many cases be an absolute bar to them going forward. We want to work with you to make 

sure that we are addressing those. 

So we are asking ourselves the question at USTR every day: How 

can we make sure that our small businesses not only are aware of 

the opportunities within the world of trade and exporting, that 

they have access to the information to get involved, and what can 

we do to make sure that we assist. Let me tell you a little bit about 

what we have done. 

Since 2002, exports by small and medium-sized businesses have 

nearly doubled—that is the good news—from $160 billion to $311 

billion in 2007. But again, that pie chart is so illustrative. I think 

it shows the explosive potential for growth that we have by investing more in our small businesses. 

12 

One example of ways that we do that, we can create market access for businesses, America’s small businesses and manufacturers 

and farmers and ranchers by two ways. Principally in the past, we 

did it by negotiating new free trade agreements, such as the agreement with Mexico and Canada, NAFTA and CAFTA. But the reality is, as those free trade agreements have matured over the 

years, we are more likely to create market access by doing what 

I think you asked us to do, is to deal with some of these non-trade 

barriers in the way other countries unfairly enforce their rules. 

We had one very high-profile success I am proud of. I have been 

in office less than 90 days now. Within six weeks, we had settled 

a 20-year-old dispute with the European Union over access of 

American beef products to the European Union. It may not seem 

like a big deal, but the fact that we got that resolved in six weeks, 

opened that market up to where it now will have thousands of tons 

more American beef exported within the European Union, well, to 

me, that doesn’t mean anything unless I think about those farmers 

and ranchers and the suppliers and all of those individuals you 

were talking to us over lunch that literally flow into this corridor, 

from Texas and Arkansas and Iowa and the Midwest down the 

Mississippi River. In many cases, the poultry, the beef is shipped 

right out of your port here. So by dealing with these barriers to 

market access now, we are creating opportunities for families, 

ranchers, manufacturers, many of whom are small family-owned 

businesses today, which translates into increased jobs and better 

paying jobs. 

So we are making market access for small businesses one of our 

highest priorities, and we have heard you. In all of our negotiations, we are actively addressing issues as customs facilitation, 

non-tariff barriers to trade, and intellectual property rights, as 

well. 

I also would like to draw your attention to the fact we just 

launched a new website. It is ustr.gov. Like you, I have a couple 

of brilliant teammates, daughters, who upon my announcement by 

the President as his nominee to be U.S. Trade Representative, on 

the same day that he announced Karen Mills, my daughters went 

on our website immediately and my smart-aleck 20-year-old, who 

is at Columbia, came in and she said, ‘‘Dad, this website is so 

1987.’’ [Laughter.] 

It took somebody else to bring it to my attention that we might 

not have even had the web in 1987, but we have made it. One of 

the priorities of President Obama is to increase information 

through the Internet. It is much more interactive. We are hoping 

that small businesses can go there, learn about our office. We have 

links to the FBA, the Export–Import Bank, and others. So I would 

hope that any of the businesses that hear or see this, if they want 

to learn more, would come to us at ustr.gov. 

Additionally, we are also expanding the access and inclusion of 

small business on a number of our advisory trade committees 

which are so important to our work. And so we have recommended 

small business owners for every one of our trade committees, from 

labor and the environment as well as the President’s Advisory 

Committee on Trade Policy. 

13 

I look forward to working with you and Senator Snowe and others—obviously, that is a Congressional prerogative— if you choose 

to create a new Ambassador for Small Business, but I want to give 

you the assurance that small business is at the core and at the 

heart of our work at USTR and we look forward to working with 

you. 

[The prepared statement of Ambassador Kirk follows:] 

14 


Insert offset folio 4 here 53008.004
15 


Insert offset folio 5 here 53008.005
16 

Chair LANDRIEU. Thank you so much, Ambassador Kirk. I truly 

appreciate that, and thank you for referencing my interest in creating a position. We look forward to continuing to work with you 

to see how that might move forward. 

The Honorable Fred Hochberg. 

STATEMENT OF HON. FRED HOCHBERG, CHAIRMAN AND 

PRESIDENT, EXPORT–IMPORT BANK OF THE UNITED STATES 

Mr. HOCHBERG. Thank you. Thank you, Chairwoman Landrieu. 

I have a longer statement which I would like to be entered into the 

record. 

Chair LANDRIEU. Without objection. 

Mr. HOCHBERG. I am pleased to appear before you today to discuss Export–Import Bank’s efforts to create and sustain job growth 

in the U.S. small business sector. As you well know from your role 

as Chairwoman, small businesses drive innovation and technological advancement, and their success, as I saw in my own family 

business and at the SBA, is critical to our economic growth. 

I also appreciate the opportunity to come back down here to New 

Orleans. I enjoyed working with you at the SBA. We did a conference when I was at the new school about cities and recovery and 

I was happy at that time we actually set up a scholarship fund for 

citizens of Louisiana to study urban policy in New York, and that 

program is still continuing. 

Chair LANDRIEU. Thank you, Fred. We appreciate that. 

Mr. HOCHBERG. President Obama placed me at Ex–Im because of 

my personal history with and commitment to small businesses. I 

understand firsthand the challenges that these owners face, having 

worked in my family’s business for 20 years, and President 

Obama’s support of Ex–Im’s small businesses and exporters is vital 

to the solution of our current economic challenge. 

I also know Administrator Mills understands these issues facing 

small business exporters and I look forward to working more closely with her. As the Ambassador mentioned, I met Ron Kirk when 

he was Mayor, so in one of his other titles, and I am also happy 

that Patty Sefcik is also here from Commerce. 

The business outlook today is daunting. We are in the midst of 

an economic crisis in credit, lack of liquidity, and depressed consumer confidence. Ex–Im is stepping up to help sustain and create 

U.S. small business jobs. It is our mandate. It is what we do. 

Through Ex–Im’s insurance, working capital, loans, and guarantee 

programs, we have supported over $50 million worth of Louisiana 

small business exports in 2008. 

Madam Chair, let me give you an example from right here in 

New Orleans. Reliable Industries provides mining equipment to 

countries such as Canada, Guyana, and Zambia. Since 2002, Ex– 

Im has provided Reliable Industries an export credit insurance policy which allows such international sales to go forward. I actually 

met Mike Rongey, who is the President of Reliable Industries, this 

morning, and I believe he is in the audience with us today, along 

with his bankers, Bill Richard and Bill Cummins of Chase, that 

helps provide some of that credit. 

Reliable Industries, with 35 employees, exemplifies Ex-Im’s mandate, to create and sustain jobs in the United States by helping to 

17 

finance exports of U.S. goods and services that the private sector 

is unable to otherwise finance. And in fact, Mike just dropped me 

a note just this past week. We helped him secure a half-million-dollar order to Latin America and, in fact, the goods are about to ship 

out of Houston in the next week, in fact. 

So far this year, Ex–Im has authorized over $2.5 billion for the 

support of small business exporters, up more than $1 billion compared to the same period a year ago. 

Let me just take a moment to review two programs most important to our small business customers. First, we provide insurance 

to U.S. exporters to insure their foreign receivables. This reduces 

the risk of non-payment and drives more U.S. sales abroad. Additionally, we have worked to find more ways to reduce the cost to 

small businesses. For example, in October of 2008, we reduced our 

premiums only to our small business customers by 15 percent. 

Second, our working capital guarantee program is often used by 

small business exporters. With this product, we guarantee 90 percent of a commercial bank loan for a U.S. exporter to fund the purchase of both equipment and raw materials to fulfill an export contract. At a time when commercial banks are stepping back, Ex–Im 

is stepping up to meet this need. 

In an effort to better serve small businesses, Ex–Im works with 

SBA to provide one-stop shopping. In April 2004, way before Administrator Mills and myself, the SBA launched a co-guarantee 

program. This initiative allows Ex–Im to supplement SBA’s guarantee to help small business exporters obtain larger loans than 

SBA could support on their own. Under this initiative, since 2004, 

we have supported 46 loan guarantees, resulting in just under $350 

million in exports. I do believe that we can and should do better 

and I look forward to working with Administrator Mills to accomplish this. 

Our regional directors partner with other agencies, such as the 

Department of Commerce Export Assistance Centers, to harness all 

Federal, State, and local resources to encourage export activity. 

And in fact, just yesterday, I met with Commerce Secretary Locke 

and I look forward to expanding our cooperation with him in the 

Commerce Department in pushing U.S. exports. 

Furthermore, in picking up what Ambassador Kirk mentioned, 

we have Ex–Im Online that provides an automated transaction 

processing system to reduce paperwork and allow our customers to 

track applications in real time. And this morning, I met Carlos Hidalgo, who I know that you know, who is here today from tech 

sales from Italy and he complimented and said the best thing I 

could have heard about this online program. 

In closing, let me just give you one more example of Louisiana’s 

small business receiving Ex–Im support. The company is Living 

Quarters Technology in Baton Rouge. It has the largest fleet of affordable living quarters for the oil and gas industry in the Gulf of 

Mexico. Living Quarters Technology employs 45 people right here 

in the State. An Ex–Im insurance policy, coupled with a working 

capital guarantee, allowed them to compete and win a $5.5 million 

contract with the Mexican oil company Pemex, and we were part 

of that bid package. 

18 

These companies remind me of my own start, and at present I 

have a mission at Ex–Im to see more of these small business successes. I look forward to any guidance from you, Madam Chairwoman, and your Senate colleagues to enable more U.S. small business exporters to capture overseas sales. I would be happy to answer any questions. 

[The prepared statement of Mr. Hochberg follows:] 

19 


Insert offset folio 6 here 53008.006
20 


Insert offset folio 7 here 53008.007
21 


Insert offset folio 8 here 53008.008
22 


Insert offset folio 9 here 53008.009
23 


Insert offset folio 10 here 53008.010
24 


Insert offset folio 11 here 53008.011
25 

Chair LANDRIEU. Thank you very, very much. 

And let me just ask—I will do this in my questions, but when 

you said you combined the program and your guarantee was able 

to increase, do you know what it was able to increase to, the 

amount when you combined your programs? You could check. 

Administrator MILLS. The total would be $2 million. 

Chair LANDRIEU. Two million, okay. Thank you. 

Patty. 

STATEMENT OF PATRICIA SEFCIK, ACTING DEPUTY ASSISTANT SECRETARY, DOMESTIC OPERATIONS OF THE U.S. AND 

FOREIGN COMMERCIAL SERVICE, INTERNATIONAL TRADE 

ADMINISTRATION, U.S. DEPARTMENT OF COMMERCE 

Ms. SEFCIK. Thank you. Senator, thank you for the opportunity 

to speak here today about the role of export promotion and our efforts to strengthen and support America’s economy. It is truly a 

pleasure to be here and I am quite honored to be part of this distinguished panel. 

Let me assure you that Secretary Locke recognizes the important 

role small businesses will play in pulling America out of this economic crisis. The Secretary recognizes that it is important to 

streamline government bureaucracy and bring solutions and services directly to businesses to help create and sustain family wage 

jobs. My testimony today will provide you with some insight on 

how the Department of Commerce has and will continue to implement programs that promote small business exports. 

The International Trade Administration helps American firms 

and workers navigate the often complicated waters of foreign trade. 

Within this unit, the U.S. and Foreign Commercial Service operates a global network of trade promotion professionals and 109 

U.S. Export Assistance Centers and at U.S. embassies and consulates in 77 countries. Commercial Service staff provides U.S. 

companies with numerous services, ranging from export counseling 

and market research to identifying foreign international buyers 

and providing advocacy support. 

Overall, the Federal Government’s trade promotion efforts are 

led by the Trade Promotion Coordinating Committee, or the TPCC. 

The TPCC is headed by the Secretary of Commerce and its members comprise 20 Federal Government agencies, including the agencies here today on the panel. This committee develops priorities on 

trade promotion and finance programs which are designed to assist 

small businesses sell their goods and services overseas. 

As part of this effort, the TPCC sponsors interagency training to 

promote a better understanding of these programs, and to date, 

over 700 participants from 12 agencies and seven States have completed this training. SBA and Ex–Im Bank representatives are colocated in some of our domestic locations with the Commercial 

Service, and together their efforts have resulted in an impressive 

list of export successes. 

For example, in Louisiana, the Dredging Supply Company located in Reserve, Louisiana, is a family-operated manufacturer of 

customized dredging equipment, which is used all over the world. 

One recent sale included a $3.5 million dredge financed by a loan 

backed by Ex–Im Bank. Among other things, the company atVerDate Nov 24 2008 15:23 Dec 07, 2009 Jkt 053268 PO 00000 Frm 00029 Fmt 6633 Sfmt 6633 C:\DOCS\53008.TXT SHAUN PsN: DPROCT
26 

tributes this success to the assistance that they received from the 

local Federal colleagues. 

Companies, especially small businesses, also use our Trade Information Center, called the TIC. This call center serves as a single 

point of contact for the TPCC’s export assistance programs, and 

last year, the TIC gave personal assistance to more than 36,000 inquiries, with 73 percent of them coming from small businesses. 

In addition, we also have a TPCC website, which is export.gov, 

that acts as a portal for the Federal Government trade promotion 

resources. Other services used by small businesses include international buyer shows, trade fairs, and trade missions which assist 

U.S. companies in developing their business relationships with customers overseas. 

In 2008, we supported trade missions to 27 overseas markets 

with a total of 420 U.S. companies participating. This resulted in 

nearly $350 million in sales to date. Several Louisiana companies 

are currently bidding on major projects as a result of the March 

2009 trade mission to Columbia. 

Strategic partnerships are key in reaching out to small businesses, and so, for example, the Louisiana Economic Development 

Office and the Louisiana District Export Council played a very 

strong and active role in sponsoring activities in conjunction with 

that trade mission. We work very closely with State and local partners throughout the United States to educate small businesses on 

the benefits of exporting, and another key partner for the Commercial Service is the network of our 60 District Export Councils, who 

work with us to increase exports through joint outreach and education events. 

So in closing, the downturn in the world economy has adversely 

affected all of our industry sectors and exports. Many of our major 

trading partners are experiencing it even more, resulting in recent 

declines in foreign demand for our goods. So in these troubled 

times, the Department of Commerce and the TPCC agency’s export 

promotion work is more important than ever for small businesses. 

I remain committed to promoting small exports. 

[The prepared statement of Ms. Sefcik follows:] 

27 


Insert offset folio 12 here 53008.012
28 


Insert offset folio 13 here 53008.013
29 


Insert offset folio 14 here 53008.014
30 


Insert offset folio 15 here 53008.015
31 


Insert offset folio 16 here 53008.016
32 


Insert offset folio 17 here 53008.017
33 


Insert offset folio 18 here 53008.018
34 


Insert offset folio 19 here 53008.019
35 


Insert offset folio 20 here 53008.020
36 

Chair LANDRIEU. Thank you very much. I appreciate all of your 

testimony, and let me, if you don’t mind, Deputy, start with you, 

because this is one of the most important issues before our panel 

today, which is the Trade Promotion Coordinating Committee, 

which you referred to in your testimony. 

In 1992, Congress established this committee to provide a framework to coordinate U.S. export promotion activities across 19 different Federal agencies. As you know, it is chaired by the Secretary 

of Commerce. Congress requires this organization to produce an 

annual National Export Strategy document, which provides an 

overview of export promotion activities by these agencies. The 

GAO, however, has recently reported that although we have made 

steady progress since 1993, we have not made as much progress, 

including the tracking of small business participation across agency 

promotion efforts. 

Can you briefly outline the roles, each of you, that your agency 

is working with the agency next to you, so starting with Commerce 

and then to Fred and over, how you all are working in this particular framework? The Senate has confirmed now the main core. 

All of you have been confirmed recently by the Senate, so you are 

now in place. Has the National Export Strategy been submitted to 

Congress yet, and if not, why not? So, Patty, why don’t we start 

with you, and then if each of you could just comment on this particular Congressional program that was established now 17 years 

ago. 

Ms. SEFCIK. Thank you. It is a very good question. The Secretariat for the TPCC obviously does reside in the Department of 

Commerce and we have been working collaboratively with all the 

agencies. Obviously, within the TPCC, there will be some core 

agencies that come up to the forefront, including the agencies that 

are here at the table today. 

The National Export Strategy is a way every year to measure our 

successes with the division of where we wanted to move forward. 

In a transitional year, such as now, the National Export Strategy 

over time historically is never printed out in a transition period. 

But having said that, we know that Secretary Locke has reached 

out to a lot of his colleagues within the TPCC and we are looking 

forward to having its first meeting this fall. For that meeting, the 

goal would be to have that visionary strategic plan of where the administration wants to go with the promotion of the Federal Government resources to collect—to come together, because what we find 

out through our collaboration, a lot of the staff that are located 

around the United States where we co-share, we come to a point 

where we want to show the successes in a visionary type of way 

so we can keep building on one another’s expertise. It is that added 

value versus we can do it alone. 

So we are hoping that we have the TPCC under the administration, that will show the vision, and once that vision, what the priorities are established, each year then thereafter, the National Export Strategy would be printed out almost like a way of the accomplishments of an annual report. So that is why it is not going to 

be published this year, due to the transition. 

Chair LANDRIEU. That is very important, because, of course, you 

know, without a vision, people perish. But without a vision, you 

37 

can’t really move forward in a coordinated way because there are 

so many different pieces. People aren’t really clear what the goal 

is. So if we can at least update, you know, refresh and update that 

strategy, particularly with some of the new leadership that is on 

board, and it is nice to get that on the record that you will all be 

meeting in the fall, and then potentially do you know—do you have 

a time frame of when the report will be ready for Congress? 

Ms. SEFCIK. I don’t have that information with me right now, but 

I could definitely send you a written response to that question. 

Chair LANDRIEU. Okay. 

Ms. SEFCIK. But I would like to say here again, at the working 

level, all of the staff, all of these agencies here continue to collaborate with all the joint training, the joint conferences, the joint 

events. The trade missions have been hugely successful. So we are 

continuing efforts, and as our leadership comes together, the vision 

will be set. 

Chair LANDRIEU. Okay, and Chairman Hochberg. 

Mr. HOCHBERG. Secretary Locke and I actually just talked about 

this yesterday when we had lunch and we are looking at some joint 

programs we could do around the country to sort of do some regional export forums and roundtables, similar to what we are doing 

today, and bringing more folks to understand best practices and examples and some of the products offered. 

That is at all of our regional offices. We have five regional offices 

and two satellites. All reside in Commerce Department offices, in 

their Export Assistance Centers. So they anchor our work there, 

and many of the leads we get come right from the Commerce Department. So we really work very closely with them for those exports that need financial assistance to get done. Many exports don’t 

need our assistance, and those that do, Commerce provides them 

those needs. 

Chair LANDRIEU. Thank you. Ambassador. 

Ambassador KIRK. Yes, Madam Chair. I would add, I think I referenced it in my remarks, my prepared remarks, the work and the 

outreach we have done both with Secretary Locke and Administrator Mills. I would just underscore, too, even while we are waiting on the formal convening of the Policy Coordinating Group, to 

echo what Patty and Fred have said, that the working groups continue. 

We have been particularly aggressive in reaching out with Administrator Mills and getting our teams together to help them understand the imperative for moving quickly, just to make sure 

that—my experience as Mayor suggests just remove as much of the 

burden from that small business figuring out. I tried to have a very 

retail approach to being Mayor, and we all know the bad experience of going to a grocery store and then saying, ‘‘It is over there,’’ 

as opposed to somebody saying, ‘‘Let me take you and get it for 

you.’’ 

And so what we are doing is just trying to make sure every day 

and everywhere, everything we communicate when we interface 

with small businesses, that we work to get to the right people at 

the right place. And again, even on our website, I have done something that was scoffed at when I was Mayor, but I have invited 

businesses to tell us what we are doing that drives you nuts and 

38 

then challenge our agency to explain why we have to do this, or 

if we can’t come up with a good reason, then we need to stop it and 

look at changing the rules. 

So we are reviewing that process. We are asking small businesses to contact us to tell us what we can do to help them more 

effectively, particularly in our negotiations to help remove barriers, 

and then working with all the agencies. 

Chair LANDRIEU. Ms. Mills. 

Administrator MILLS. Well, Madam Chair, thank you for bringing up this point, because the Trade Promotion Coordinating Committee is very, very important to our efforts and the SBA is very 

pleased and excited that Commerce’s leadership is going to bring 

this group together in a vital way. This is important for us to be 

able to do our work. Our current organization is housed, co-located 

with Commerce for all of our trade activities, and as you know, we 

do co-guarantee already with Ex–Im Bank. 

But I think even more interesting is the strategy that Ambassador Kirk and I have begun to discuss, really from the first meeting that we have had, and now we have got our teams together, 

which is how is it that we are going to deliver the small business 

aspect of this coordinated strategy. So that will be ongoing and will 

be finally brought to you by the reports and the activities of this 

Coordinating Committee. So thank you for the pushing. 

Chair LANDRIEU. Thank you, and I will only add—I have a few 

more questions and then we are going to move to our second panel, 

but I would only add, and I am not the expert on the Internet, but 

I am really enthralled with what I am able to do myself, which is 

very empowering. But when I watch what my staff is able to do in 

terms of finding information, accessing, it truly is quite remarkable. 

And as a government official for many years, it occurs to me that 

some of our stovepipes, not only do we need to collaborate more 

with each other, but we have got to be on the cutting edge of this 

communication so that when a small business is sitting out there 

somewhere in America and they are thinking, I want to export, 

they have some idea of what part of the world they want to export 

to, they should hit a button, and let us say Colombia or Central 

America, South America should come up, and there should be information very valuable from each of you and all of the different entities so that it starts framing a clearer picture of the opportunities 

in that country. 

And that is the way the new generation uses the Internet. You 

know, you want to go on vacation. You sit there and you look at 

all these sites and you think, where do I want to go in the world? 

You hit a button and you have got lots of options. I see these heads 

shaking, so I know I am hitting some nerve here. 

But I don’t think that government actually, although the President himself has done quite a remarkable job with his own communications, I think that the government entities—and I am going to 

make sure at least the ones that I have some responsibility for 

push this issue out, because it is just the way this generation operates. They don’t go to conferences. They go to their living room, hit 

the ‘‘click’’ button, and they take themselves all over the world, and 

we have got to respond to that. 

39 

So my point would be, have the meeting, get the plan, but let us 

get the plan on the Internet in a way that people can facilitate it 

and use it, because really, truly, it is a great market out there, and 

as you see, we have a great many businesses that are searching for 

markets. They are looking for them in their area where they live, 

but they are also looking at markets around the world to grow 

their businesses and I think we can be helpful. 

Let me just ask a few more questions, if I could. Ms. Mills, you 

know that last year, the SBA made 3,300 loans to exporters. We 

approached the end of the third quarter of 2009. Our records show 

that only 598 loans have been made to exporters. Now, we know 

there is an economic downturn not only here at home, but markets 

abroad have been shrinking. Do you agree that these are the figures? If not, could you clarify what you think they are, and what 

are some of the strategies that you might employ now as the new 

leader of this agency to see what we could do, if you could list 

maybe one or two specific things to try to move these loan amounts 

or numbers up. 

Administrator MILLS. Thank you, Madam Chair. These are the 

same figures, I believe, that we have, and as you know, lending in 

the fall of this year really just ground to a halt overall. Our overall 

lending is down 50 percent. And with the Recovery Act, we have 

been able to push that back up by 35-plus percent, but it is not 

even yet close to 2008, 2007 levels. So we have more work to do, 

both to get banks back in the program and to get companies ready 

to be able to borrow. 

That applies, as well, to our exporting communities, plus I think 

what you heard here is that we have the opportunity now to increase our collaboration with the others at this table and explore 

ways that export markets might provide the revitalization that 

some of these companies need. So a company that before was doing 

just fine domestically and now finds those markets are not coming 

back could very well be turning to export as a more primary option. 

So I think the things that you have heard today, developing this 

collaborative small business strategy, continuing our outreach, both 

through the Recovery Act programs, we have revitalized our district offices, we are adding to our export representatives that are 

co-located with Commerce, and even more importantly, Secretary 

Locke and I have talked about this enormous network that Commerce has domestically and in other countries and using that network. We have also talked to the Department of State. They have 

economic representatives. And so we are looking at using those and 

connecting those, who mostly have been dealing with large businesses, connecting those more strongly to small businesses. So I 

think that could be very powerful. 

Chair LANDRIEU. Thank you very much. 

Chairman Hochberg, let me ask you, 22 percent of the Export– 

Import Bank’s financing directly supported small business. As you 

know, there is a legally required threshold of 20 percent, so last 

year the Bank met its goal. What are your plans, though, as the 

new Chair to perhaps even expand on this threshold, and what potentially do you have in mind to see if we can not only meet, but 

potentially even exceed this goal of 20 percent next year? 

40 

Mr. HOCHBERG. Thank you for the question, and more importantly, thank you for your interest. Actually, in the two prior years, 

we were actually as high as 26.7 percent, though those percentages 

are very—they are difficult to manage, and I will give you an example. This year, small business lending is up 83 percent, but 

large aircraft, such as Boeing, is up 100 percent, so although we 

are making great strides and actually have an increase in loans to 

small business exporters this year, some other transactions have 

grown even more quickly. 

So although we have a goal of 20 percent, I would not say that 

we are going to meet that every year. Some years we will go above 

it. Some we may be a little lower because we want to take in every 

piece of business we get in the door and not turn someone down 

just to meet our numbers. 

But that said, I mentioned in my written testimony, I was out 

in Pittsburgh last week. I met with all of our regional directors, 

looking at a number of the programs that we have, seeing what 

some of the impediments are to making those programs more effective so that we can help more small business owners in their export 

efforts. We have a program, just to explain, we have a program for 

insurance, where if you are an exporter selling overseas, we will 

ensure that you will get the receivable. And once the company has 

that insurance that they are going to get paid, we are actually 

going to help them go to a bank and get more loans for working 

capital and other types of—to help the rest of their business. That 

may in some way pick up some of the slack that some of the small 

business lenders are having, because once a company knows they 

are guaranteed to get paid, a bank is more likely to lend to them. 

So we are trying to couple a number of those programs together in 

a way that we really haven’t before. 

Chair LANDRIEU. And can I ask you to follow up? What strategies 

are you employing to coordinate some of this with the community 

banks in the country, not necessarily the large national banks, but 

do you have any special relations with the community banks which 

are regulated at the State level and for the most part managed 

through this downturn pretty well? 

Mr. HOCHBERG. You know, I had great experience with the community banks when I was at the SBA. We had a program called 

Community Express, where we actually delegated specific authority 

to community and small banks. There has been so much turmoil 

in the banking industry, and in fact, just this past week, we have 

been discussing how we manage our banking relationships better 

because they are frequently product line by product line and we are 

not very often looking at how we are managing an entire book of 

business with an entity. I think community banks are very important and probably even a bit under—not gotten the full attention 

they should have gotten. 

Chair LANDRIEU. Well, I share that, because in my experience in 

the last couple of months dealing with this financial crisis that the 

members of Congress have had to deal with literally every day, it 

occurs to me that there is an extraordinary network of community 

banks as well as credit unions out there who are in these communities, located on all these Main Streets, who know all these busiVerDate Nov 24 2008 15:23 Dec 07, 2009 Jkt 053268 PO 00000 Frm 00044 Fmt 6633 Sfmt 6633 C:\DOCS\53008.TXT SHAUN PsN: DPROCT
41 

nesses who are trying to reorganize and shuffle through the challenges before them. 

And I know that the Administrator and I have spoken about this 

and I would like her to comment in a minute about what the SBA’s 

vision is to build a stronger partnership with the community banks 

that are located in every town, large and small, from Dallas to 

Tallulah to Jackson, Mississippi, to Portland, Maine, and in between. So I don’t know, Administrator Mills, if you want to just respond for the record of some of the things you are thinking about 

with reaching out to community banks and getting them more involved with the core SBA lending programs, but also perhaps just 

as better all-around partners to what we are trying to do at the 

Federal level. 

Administrator MILLS. Thank you, Senator. Actually, you brought 

this up in my confirmation hearing and we actually took it to heart 

and have been working on it as a priority ever since, and that is 

how do we add banks, particularly community banks, to the SBA 

network? We had been losing banks up until this point. We have 

about 50 percent penetration in the Federally chartered banks, but 

very low penetration in State chartered banks, which are mostly 

these community banks, and also with credit unions, which are another priority. 

So we have done a number of things to reach out to community 

banks, including conversations with the heads of the community organizations, understanding how they use SBA products, what we 

can do to bring more into the fold. And in fact, we have had a reasonable amount of success, because as I said, 600 banks have come 

back to the SBA and made a loan since the Recovery Act was announced in February. So that is 600 banks who had not made a 

loan since October. Half of them actually had not made a loan since 

2007. 

And so the majority of these are the kinds of banks we are talking about, and it is because we were able to reduce our fees, increase our guarantees, and reach out to them— they had the capital but they couldn’t lend because they didn’t have a secondary 

market for their goods and they didn’t have the liquidity. 

So we have now begun and we will get more with the ARC loans, 

new lenders, and we are making this one of our objectives. As you 

know, I have a dashboard with certain metrics on it. This is one 

of the top metrics we follow. 

Chair LANDRIEU. Thank you. 

We are going to move to our second panel, but is there anything 

that you all did not get to say that you would like to add before 

this testimony is closed? Of course, the record will stay open for the 

panel for two weeks. But anything that you want to add, Madam 

Deputy? Mr. Chairman? 

Ambassador KIRK. Thank you for your leadership. 

Administrator MILLS. And also, thank you and to this region for 

the hospitality. 

Chair LANDRIEU. Thank you. Well, you are welcome and we hope 

that you will come back often. Many of our restaurants have 

opened and reopened. We don’t have 100 percent of them open, but 

I guarantee you can get a good meal if you come, so thank you very 

much. 

42 

We will take a five-minute break and bring our next panel up. 

[Recess.] 

Chair LANDRIEU. We have with us Mr. Eugene Schreiber. Gene 

Schreiber, Managing Director of the World Trade Center of New 

Orleans is our first witness. He is here on behalf of 1,600 corporations and individual World Trade Center members. Many of us 

know Mr. Schreiber and we thank you very much for your leadership. 

Ms. Diana Simek is our second witness, representing Shreveport 

and Northwest Louisiana. Ms. Simek is Vice President of Ark–La– 

Tex Regional Export and Technology Center and Manager of the 

Metro/Regional Business Incubator. Both organizations are subsidiaries of the Coordinating and Development Corporation, CDC. 

Prior to her current position, she owned a public relations firm and 

has a great deal of experience in this area. 

Thirdly, Ms. Wilma Castro, owner and Director of International 

Export Sales, which is a Louisiana company classified as an export 

trading company based in St. Rose, Louisiana. Her company specializes in the purchase of resale of U.S.-manufactured supermarket equipment, commercial refrigeration, and light industrial 

refrigeration to Latin America and the Caribbean. 

Mr. Jerry Hingle is our fourth witness. He is Executive Director 

of Southern United States Trade Association, an export trade development association made up of the Departments of Agriculture 

of 15 Southern U.S. States and Puerto Rico. It is headquartered 

here in New Orleans. It operates in over 30 countries worldwide. 

We are scheduled to end at three o’clock, so I am going to ask 

each of you if you could limit your opening remarks to three to four 

minutes and that will give us some time for questions and comments. 

Mr. Schreiber. 

STATEMENT OF EUGENE J. SCHREIBER, MANAGING 

DIRECTOR, WORLD TRADE CENTER OF NEW ORLEANS 

Mr. SCHREIBER. Thank you, Senator Landrieu. A lot of exciting 

developments for the future are taking place in Louisiana on international trade despite the current worldwide slowdown. My written 

testimony addresses a number of subjects that time will not permit 

me to cover now. They include Louisiana’s role in the global economy, recent export results and trade-related recovery efforts, the 

State’s deepwater port system, and new tax credit legislation regarding the ports, the new non-stop Aeromexico flight from New 

Orleans to Mexico City, and the possibility of future U.S.–Dominican Republic CAFTA meetings to be held in New Orleans, all of 

which significantly affect small business. 

I will focus my remarks now on Federal Government export programs to assist small businesses. We all know that engaging in 

international trade is a continuous challenge for a host of reasons—payment problems, shipping delays, cultural differences, and 

numerous changing procedures and documentation requirements to 

contend with in every country, including our own. All of this can 

be very confusing and daunting to the newcomer, to say the least. 

While there is a favorable trend towards harmonization, we are not 

there yet. 

43 

Middle-market exporters of manufactured products and services 

need comprehensive training in the export process in three ways. 

First, basic training in exporting procedures and documentation. 

Second, learning about trade finance programs available from the 

SBA, Ex–Im Bank, and other financial institutions. And third, export promotion programs offered by the Commerce Department and 

other agencies to Export Assistance Centers located throughout 

this country, including New Orleans, and at U.S. embassies and 

consulates abroad in the larger countries. 

But it is this first category of training that I wish to discuss now. 

Trade finance, working capital loans, gold key services, and other 

government programs are of course extremely valuable at a certain 

point, but I believe the starting point for a would-be exporter is to 

fully understand the export process, the steps of going to it, the 

procedures, trade terminology, regulation, and documentation. This 

includes learning how to prepare an export business plan, understanding the role of freight forwarder, the difference between FOB 

and CIF, preparing a pro forma invoice, packing lists, the shipper’s 

export declaration, and other documents and details involved in exporting, where even small errors can be potentially very costly. 

All this takes time and effort by small business to learn, and despite the available technology, it can’t be Googled or absorbed at 

a breakfast or half-day workshop. To meet this need, the Greater 

New Orleans Small Business Development Center, under the SBA, 

offers a 17-hour export-import seminar that is divided into four 

afternoon sessions of four-and-a-half hours each. Admittedly, that 

may seem like a lot of time for a small business person to devote 

to learning the basic export and import process, but it is necessary, 

although the export and import sections could be divided into two 

separate courses. 

But the real problem is that for budgetary reasons, the course is 

offered mainly in the New Orleans area at this time, whereas most 

of the individuals and companies that require this intensive training are located in other parts of the State. One solution would, of 

course, be to dedicate additional human resources, if they are available, to conducting the training in more locations to reach more 

companies. But a better remedy would be to develop training videos or webinars that can be widely publicized throughout the State. 

The SBA and Commerce Department may want to jointly evaluate 

this possibility if they haven’t already done so. 

With regard to several recommendations that have been made by 

your committee, we applaud your initiative to heighten attention 

on exporting by small companies. Specifically, the recommendation 

to create an Assistant U.S. Trade Representative position for small 

business issues and the recommendation to appoint an Associate 

Administrator in the SBA to be in charge of overseeing all trade 

policy and programs and to coordinate efforts with other agencies 

would certainly appear to help accomplish those objectives. 

Regarding trade-related positions in Louisiana, it is our understanding—in fact, it was confirmed by the Administrator a few 

minutes ago—that SBA may assign a financial trade specialist to 

work out of the Export Assistance Center where, in fact, there previously was such a staff person some years ago. So this is most welcome. 

44 

We would also suggest, and I think this is very important, that 

the individual assigned to that position by the SBA be equally 

knowledgeable about the basic export processes described earlier in 

order to assist in overall export training and not be strictly limited 

to working on SBA export loans. 

We also are aware that the Export Assistance Center in New Orleans is short at least one trade specialist at this time, and filling 

that position, which has not been discussed up until now today, 

also would be important in terms of further assisting exporters, 

and particularly new-to-market small companies that have a good 

export potential. We would make the same recommendation as 

above insofar as that staff person have a good grounding in the details of the export process, including documentation and procedures. 

With regard to Federal Government export finance programs for 

small businesses, in a nutshell, most of our World Trade Center 

members we talk with believe that Ex–Im Bank’s 50 percent U.S. 

content for its short-term and credit insurance programs is too high 

and that the SBA’s ceilings on their two relevant export programs, 

the Export Working Capital Program and Export Express, are too 

low at $2 million and $250,000, respectively. There is further discussion of these issues in my written testimony. 

Again, thank you for holding the committee’s hearing in New Orleans today and inviting the World Trade Center to testify. We 

stand ready to assist you and the committee in your ongoing efforts 

to advance the United States’ international trade position. Thank 

you. 

[The prepared statement of Mr. Schreiber follows:] 

45 


Insert offset folio 21 here 53008.021
46 


Insert offset folio 22 here 53008.022
47 


Insert offset folio 23 here 53008.023
48 


Insert offset folio 24 here 53008.024
49 


Insert offset folio 25 here 53008.025
50 


Insert offset folio 26 here 53008.026
51 


Insert offset folio 27 here 53008.027
52 


Insert offset folio 28 here 53008.028
53 


Insert offset folio 29 here 53008.029
54 

Chair LANDRIEU. Thank you, Mr. Schreiber, and we always appreciate your comments and suggestions and we value your counsel. Thank you. 

Ms. Simek. 

STATEMENT OF DIANA SIMEK, VICE PRESIDENT FOR BUSINESS DEVELOPMENT, ARK–LA–TEX REGIONAL EXPORT AND 

TECHNOLOGY CENTER, INC., AND MANAGER, METRO/REGIONAL BUSINESS INCUBATOR, SHREVEPORT, LOUISIANA 

Ms. SIMEK. Thank you for inviting me. I really sincerely appreciate all the efforts that you have put into trying to help our small 

businesses. In fact, the two subsidiaries of CDC that I represent, 

you were the guest speaker when they were announced in 1995, 

and I thank you for that, too. 

There is some of the information that Gene talked about that I 

agree with. One of the sad statistics is that according to the SBA’s 

2008 report to the President, only 1.6 percent of Louisiana small 

business with employees export. Think of what we could do to both 

help better the economy, to create new jobs, and positively impact 

our trade deficit if we could increase that to even ten percent. 

Virtually everything—as Gene said, virtually everything in exporting is different from selling to the local and regional economy, 

but we have so many good agencies already in place that if we look 

at—if we just could get them to do and be more known to the people that are out there, and that is one of the things is I agree with 

you. We need to put more information on the web and make it very 

easy to find. If you look at the SBA’s website, you have to dig to 

find where their international trade is. It is buried underneath capital access. So this goes to some of our recommendations. 

One is to get all of these agencies to collaborate together more 

frequently. I think it was obvious from what was said today that 

it desperately is needed. And rather than spending—Gene, contrary 

to you—rather than spending large sums of money and time to create another separate Export Assistance Center through the SBA, 

because that would mean having to train and find all these new 

people, it seems to me that developing strong collaboration and referral programs among all of them is what would be in the best interest of small business in the United States. 

There are a few areas that I would like to address that I think 

SBA could do immediately with little cost to help small businesses 

interested in exporting. First is to change the SBA website, because 

you just can’t find anything and they don’t refer—you have to go 

way into it to find any kind of resources. 

Second, encourage—I didn’t realize, and I didn’t meet her until 

today, but I didn’t realize she was an ETC, ETM, EMC, or Export 

Management Trading Company—but encourage the development of 

Export Management Companies and Export Trading Companies. 

These companies serve as expert intermediary agencies for small 

businesses that prefer not to export. We don’t have a list of them. 

So we don’t know where to find them. I even called Gene one time 

and we couldn’t even locate one. 

Mr. SCHREIBER. Very few. 

Ms. SIMEK. So very few. SBA should develop a method to register 

EMCs and ETCs similar to what they do with the franchise compaVerDate Nov 24 2008 15:23 Dec 07, 2009 Jkt 053268 PO 00000 Frm 00058 Fmt 6633 Sfmt 6633 C:\DOCS\53008.TXT SHAUN PsN: DPROCT
55 

nies for the loans and provide this list of exporting agencies broken 

down by product type on their website. 

Encourage small businesses that have won SBIR research grants 

to export their technologies overseas. SBIR awardees are required 

to report their commercialization efforts to the awarding agencies. 

Adding a section to this report dealing with exporting activities 

could serve as a reminder to the small businesses that they need 

to think globally when considering future commercialization opportunities. 

Develop a method—I represent the Business Incubation Association, so I have to think about us—but develop a method to work 

with the nation’s business incubators, which today total more than 

1,000 nationwide. Business incubators, especially those linked to 

the universities and working with SBIR clients, like mine does, we 

know where the high-tech and the new innovative products are and 

so we could help make sure that they get some exposure to international markets. 

And again, the web. Small business owners find it difficult to attend seminars. The Internet offers a great solution in webinars. 

SBA, in collaboration with other exporter assistance programs, 

should offer an ongoing series of webinars covering all the important aspects of what a new exporter needs to know. 

ABC annually publishes a Small Business Lending Report listing 

U.S. banks that have made SBA loans during the year. A similar 

listing identifying U.S. banks that provide export loans would be 

a handy tool for small exporters. And rather than initiate a grant 

program nationwide, as has been kind of recommended in some of 

the legislation, a pilot program might be considered and monitored 

to see if the use of such grant funds would truly benefit small exporters and the nation. 

Another thought—and I think that Jerry is going to handle this 

one—another thought would be to examine the possibility of adopting a program similar to USDA’s FAS Market Access Program, 

whereby an organization such as SUSTA would handle requests for 

government subsidiary funding for exporters. 

In closing, I would really like to make very clear that I have— 

my comments about the SBA only refer to the international. I fully 

acknowledge that they are the premier Federal agency when it 

comes to offering business counseling and seminars for small business. Their loan programs are excellent. Unfortunately, they are 

not well used in our area, though, and I regularly refer my clients 

to SBA’s online training programs. 

Again, I thank you very sincerely for holding this hearing and I 

welcome any questions you may have. Thank you. 

[The prepared statement of Ms. Simek follows:] 

56 


Insert offset folio 30 here 53008.030
57 


Insert offset folio 31 here 53008.031
58 


Insert offset folio 32 here 53008.032
59 


Insert offset folio 33 here 53008.033
60 


Insert offset folio 34 here 53008.034
61 


Insert offset folio 35 here 53008.035
62 

Chair LANDRIEU. Well, thank you. I am very impressed with your 

testimony. You gave quite a few specifics and we appreciate it and 

thank you very much. 

And Ms. Castro, we are happy to have you, and you can explain 

the Export Trading Company, of which you are one, and welcome. 

STATEMENT OF WILMA CASTRO, OWNER, INTERNATIONAL EXPORT SALES L.L.C., ON BEHALF OF THE LOUISIANA DISTRICT EXPORT COUNCIL, ST. ROSE, LOUISIANA 

Ms. CASTRO. Thank you, Senator Landrieu, for the opportunity 

to testify as part of this panel. Export sales have meant a great 

deal for my company and my family and I look forward to telling 

you a bit of my experience. 

I got into the export business over 15 years ago and I can truly 

say that every day has been a learning experience. Selling internationally isn’t easy. One of the keys to my success has been learning about the resources that can help small companies like mine 

export profitably. 

My experience in the international business started in my native 

Honduras, when I marketed products from Honduras to Europe 

and the U.S. Years later, I came to America and I started selling 

supermarket equipment overseas with Interamerica Sales. Next, I 

worked as an executive sales representative for Albert Rebel and 

Associates out of California. I managed their New Orleans branch 

until the year 2000, when I decided to start my own company. Relying on the experience in the supermarket supply industry, I decided to create a business based entirely on sales to Central, South 

America, and the Caribbean. 

International Export Sales is classified as an Export Trading 

Company which specializes in the purchase and resale of U.S.-manufactured equipment, commercial refrigeration and light industrial 

refrigeration equipment to Latin America and the Caribbean. We 

offer our customers everything from shopping carts to freezer display units and many things in between. We maintain customer relationships with over 100 international clients comprised primarily 

of foreign supermarket chains, resellers, and distributors. 

Our staff has over 20 years of experience in the export business. 

Even so, I find that it always pays to know outside experts who can 

help us in tricky situations. One of the wonderful things about 

being an entrepreneur in the U.S. is the wide array of government 

resources to help companies sell internationally. I have used a 

number of these. Today, I would like to talk in particular about the 

U.S. Commercial Service and the Ex–Im Bank. 

I always say that customer service is the cornerstone of our business. In fact, our desire to better serve our customers is what led 

us to work with Ex–Im Bank in the first place. We currently have 

an export credit insurance policy with Ex–Im. This allows us to extend better terms of credit to our buyers and limit risk to our small 

company. 

In today’s competitive global economy, I have found that deals 

can be won and lost because of financing. We have increased our 

sales by providing open account terms to our best international 

customers. For example, just a few months ago, we won a major 

63 

sale in Honduras with the help of Ex–Im credit insurance simply 

because we were more competitive because of this resource. 

I would also like to talk about the assistance we received from 

the U.S. Commercial Service. For years, I have relied on the New 

Orleans U.S. Export Assistance Center for market research, trade 

leads, help with export documentation, and contacts in international markets. These trade leads are very specific and actionable opportunities generated by the U.S. Commercial Services staff 

in U.S. embassies overseas. Timely information like that is a huge 

help in our marketing efforts. 

On several occasions, the Export Assistance Center has been instrumental in helping us close a deal. For example, recently, we 

had a potential customer from El Salvador who contacted the Export Assistance Center to verify that we were a reliable supplier. 

The Export Assistance Center staff were able to immediately verify 

that they knew us, they knew me personally, and had even visited 

our company over the years. With that assurance, we got the sale, 

so it does help. 

I am also grateful to the U.S. Department of Commerce for establishing the Louisiana District Export Council, or DEC. The DEC 

serves as something of an advisory board for the Commerce Department. Its membership includes exporters like me, trade association representatives, Federal, State and local export assistance 

specialists, and service providers like attorneys, bankers, and 

freight forwarders. I am honored to be a member of the Louisiana 

DEC. 

Together, our members have over 100 years of hands-on trade experience. We act as mentors to new exporters in our State and 

work with the U.S. Export Centers to develop outreach and other 

programs. This year, we embarked on an inclusive planning process to identify five core objectives for our DEC. Members volunteered to staff subcommittees to work on action items for each objective. One of these is a Louisiana Exporters’ Resource Guide, 

about which we just met this morning. 

My fellow DEC members also are wonderful resources for me 

personally. We share ideas, challenges, and best practices. We get 

together quarterly to discuss new trade trends and other developments. It is nice to be part of an exporting community. 

Finally, I should note what a big help the Central America Free 

Trade Agreement has been to our company. Free Trade Agreements like this one make our products more competitive. We see 

a direct result between CAFTA and increased sales in Central 

America. I encourage the Congress to work towards the passage of 

other trade agreements, such as Colombia and Panama. 

Before I close, I want to thank Senator Landrieu again for asking 

me to testify before this committee. I gained my U.S. citizenship 

last November and I am honored to be recognized for my company’s 

success and to represent American entrepreneurs everywhere. 

Thank you. 

[The prepared statement of Ms. Castro follows:] 

64 


Insert offset folio 36 here 53008.036
65 


Insert offset folio 37 here 53008.037
66 


Insert offset folio 38 here 53008.038
67 

Chair LANDRIEU. Thank you. We are very proud to have you as 

a new citizen of our country. Thank you for your contribution. 

Mr. Hingle. 

STATEMENT OF JERRY HINGLE, EXECUTIVE DIRECTOR, 

SOUTHERN UNITED STATES TRADE ASSOCIATION 

Mr. HINGLE. Thanks, Senator. I really appreciate being part of 

today’s discussion. Again, I am here with the Southern U.S. Trade 

Association. We are a nonprofit trade association based here in 

New Orleans that helps companies export, small companies primarily. We are based here in New Orleans, but we do help companies throughout the Southeastern United States. I am going to talk 

a little bit about the program, who we are, and also highlight the 

Federal Market Access Program as a resource that is available to 

small businesses looking to export. 

Our agency has helped thousands of organizations tackle international markets around the world. We help companies in many 

ways. We talked about training. We help small companies in training, one-on-one, go to their place of business, coach them how to 

export. We coordinate a number of trade events around the world, 

trade shows and buyers’ missions around the world. We sponsor 

their participation in those events. 

I am sure you recognize some of the Louisiana products here. 

They are known here locally, rice, Zapp’s potato chips, sauces. They 

are known very well here and increasingly known around the world 

thanks to their involvement with our programs. All of these products here, we have helped promote abroad their brands. The Department and the Market Access Program, in a number of countries around the world, and increasingly even in places, India and 

Japan, buying these products on the shelves or in the restaurants. 

It is really quite a sight to see. 

The testimony that I turned in has 20 companies listed we have 

worked with over the last couple of years. You probably recognize 

quite a few of those companies. Our work is funded mostly by the 

Market Access Program, or MAP. This is administered by the 

USDA’s Foreign Agricultural Service. It was launched about 20 

years ago with the intent of helping farmers and food producers export. There are about 70 groups that partner with USDA to help 

thousands of companies across the U.S. export. 

We are all nonprofits, and one of the kind of things of the MAP 

program’s Branded program, where we extend funds directly to 

companies that go off and promote their brands overseas, and we 

will reimburse them at half of their cost of doing so, qualified cost, 

qualified number. It has to be a small business. It has to be at 

least 50 or more percent of U.S. origin, et cetera. 

In our region of the U.S. alone, there are hundreds of companies 

that are now successful exporters as a direct, attainable result of 

their work with us and MAP program. Just a few years ago, these 

companies never even considered exporting. We can help you get 

there. 

Research commissioned by the USDA proves the program works. 

Their research says that for every dollar that is in export promotion, some $25 in export sales typically occur through seven 

years after the fact. In our own research, we asked the folks who 

68 

take part in our programs. Almost immediately, we are seeing a 

$22-to–$1 return, I guess you would say. For every dollar we invest 

in these companies in finding buyers overseas, we are seeing a $22 

return, so just right there. 

On the macro scale, the U.S. spends about $235 million on these 

programs. MAP is about $200 million each year. It has a sister program, about $35 million. Our competitors—the European Union, 

Canada, Australia, South Africa, the big players out there—combined spend $1.2 billion every year to do the same thing. That is 

five times our annual budget to help companies export. And we are 

losing ground to a lot of these competitors in key markets. 

The 2008 farm bill, sadly, OMB has proposed a 20 percent cut 

in the program, from the current $200 million by 20 percent. There 

appears to be some confusion. I think that there is belief that it 

benefits large companies, but by definition is only for and by the 

small companies. There is confusion there, and they do cite some 

arguments that this is specifically rejected on many House and 

Senate floor votes over the past 15 years. So there is a lot of confusion over the program in Congress. I think there is some confusion 

right now for next year. 

We know the program works well. We know for a fact that users 

out there, hard data and anecdotal, the information we know of is 

that the program works well, and we think it aligns perfectly with 

Washington’s goal to create jobs locally and build sales and jump 

start the economy. We know that it is helping create local jobs as 

well as generating sales internationally. 

So we are urging Congress to keep the program as it is, intact 

as written. Basically, it is not broken, so let us not try to fix it. 

[The prepared statement of Mr. Hingle follows:] 

69 


Insert offset folio 39 here 53008.039
70 


Insert offset folio 40 here 53008.040
71 


Insert offset folio 41 here 53008.041
72 


Insert offset folio 42 here 53008.042
73 


Insert offset folio 43 here 53008.043
74 


Insert offset folio 44 here 53008.044
75 


Insert offset folio 45 here 53008.045
76 


Insert offset folio 46 here 53008.046
77 


Insert offset folio 47 here 53008.047
78 


Insert offset folio 48 here 53008.048
79 


Insert offset folio 49 here 53008.049
80 


Insert offset folio 50 here 53008.050
81 

Chair LANDRIEU. Thank you very much. It has been very helpful. 

We have got a few minutes for questions, and let me, if I could, 

Mr. Hingle, start with you. I am very interested in this particular 

program and its applications, of course, coming out of the Agriculture Department, but many have applicability throughout what 

the subject of this hearing is today, particularly on the training 

and outreach, recruiting opportunities, et cetera. We are learning 

how the mark program was started. Was it a Congressional authorized program or was it something started either with or adjacent 

to the Agriculture Department? Remind me of that. 

Mr. HINGLE. Its origins were within USDA. I can’t speak to the 

whole issue of it. I can certainly find out for you. 

Chair LANDRIEU. That is okay. Staff will check on it, because I 

am very interested in that particular model, and if the staff has 

any information, you can slip me a note about it. But I think that 

it is an excellent model, and, of course, representing a State that 

has a strong agricultural base, I am very familiar with the opportunities and the pressure from the farmers who are looking for other 

markets for their products. It is very, very important, and, of 

course, they are pretty much front and center on some of these 

trade agreements. But the finished products are not just the crop 

itself or the commodity itself. It is also interesting in the way you 

have outlined how that program works, so we will follow up. 

Let me ask each of you all, and some of this is in your testimony, 

which was excellent, for the record, but if you had to, starting with 

you, Mr. Schreiber, say one change that you would recommend at 

the Federal level, just one change that you would recommend that 

might really help to increase the number of small business exporters, what would that one change be? 

Mr. SCHREIBER. Well, I will reiterate. In real estate, it is always 

location, location, and location. For me, after many, many years of 

this, I have concluded it is all about training and planning your export future. That isn’t done by hardly any companies. They jump 

into it. They say, well, it is just like the U.S. I will go over there, 

or Canada. I will start selling. And I see examples of companies 

lose their shirt or lose their company because they made a mistake 

that would not have cost them one penny to eliminate if they had 

simply been trained properly. 

Now, the training is tedious and dry. I won’t say boring. I think 

it is very exciting. But it is dry. But if you don’t have the vocabulary, if you don’t have these rules and regulations—we know how 

many rules and regulations there are in our country. Well, multiply 

that by 200 countries around the world. 

So I think it is this basic training that we always pawn people 

off to somebody else. Oh, go see so and so, or go see the freight forwarder. But not many organizations, and that is especially true in 

Louisiana, which I am very familiar with—it is not being done sufficiently in Northern Louisiana because, compared to a shopper 

who doesn’t travel now because of restrictions, I am not sure in 

Northern Louisiana who is doing that nitty-gritty training of the 

forms, not the programs that are out there, but how do you—what 

do you actually do. 

82 

Chair LANDRIEU. Ms. Simek, what would you say? Do you agree 

with that, and if so, you can expand. But if you don’t, what is the 

one thing you would change? 

Ms. SIMEK. I truly believe that we do a very poor job throughout 

the entire country, including Louisiana, in teaching people about 

entrepreneurship. So it goes beyond the training. We are still—continue through our educational system to train people to work for 

a General Motors. If you look at where we are, we don’t—and as 

part of the entrepreneur—I would love to see entrepreneurial training and more respect for the small business people. And in part of 

that, we need to talk about the export, the potential. 

The United States has always been a country that was so lucky 

because we had such a large population, we didn’t have to export. 

If you wanted to export to Europe, you had to do it individually, 

France, Netherlands, whatever. Now, they have got the EU, so now 

they are competing with us and we don’t know how to do this. 

And so we need to get classes back into the universities, if nothing else. We need to have some classes that are not through a 

counselor, but through a course that we should have, and we don’t 

have that now. And maybe that would be beyond the entrepreneurship, but just have something that focuses in on teaching people 

how to—all the things that are involved in exporting. 

Mr. SCHREIBER. The universities do not teach this, by the way. 

Chair LANDRIEU. Well, I was sitting here thinking of our 21 universities that we have, Mr. Cravins? I think we have 21 Louisiana 

universities, as I recall, and it would be interesting to follow up on 

that. 

Ms. Castro, what do you think the one change could be and do 

you agree that this training is a component, and also—three questions for you—how did you train? And use the microphone, if you 

would. 

Ms. CASTRO. Okay. I was hearing what they were saying. I do 

100 percent of my business is overseas. What can I say about how 

to train or what is the requirement or—I don’t know. I believe in 

traveling, but to travel, you need to have a contact, right. So I 

guess my contacts have been through word of mouth from one customer who you are doing business and becomes one. 

Right now, I don’t know how to think or what to do or say about 

how to train them, because I have had all kinds of experience. Experience is open and counts as real, whether it is Ex–Im Bank experience—and actually sitting here right now, I have supermarkets 

asking me to get store resources from Louisiana distributors of 

food, that they want to import in Central America. Why? In Miami, 

they get all the business. But Miami knows it and the prices are 

not very competitive. So actually there is a big company called 

Napco. I have been training him, and I brought him customers. I 

sell the equipment. I brought him the customers for him to—I 

mean, well, we did it like a deal, but it is a way to start. He doesn’t 

know how to start. So I said, okay, my job here in this case in the 

supermarket is selling equipment. I bring him customers. Now, in 

their case, they want to learn how to—say exposure, I guess, how 

to do it, how to get a contact. 

What are the steps of the process? I would say the first thing you 

do is I believe in those trips that are organized by the—— 

83 

Chair LANDRIEU. Chamber of Commerce sometimes, and others. 

Ms. CASTRO. So you go to the company, country, and it is a good 

point to start, because there you meet what they want, one to one. 

Later, somebody asked me what is the risk. Well, everything in life 

has a risk, but if you insure your product, the risk is—— 

Chair LANDRIEU. It can be minimized. 

Ms. CASTRO [continuing]. Minimized. But it is never—to me, it 

is very important you face and you see the firms. It is very important. 

Chair LANDRIEU. Mr. Hingle. I hope that you all have gotten 

some good ideas together, that you all can exchange cards or we 

can expand opportunity right here. That is one of the real benefits 

of these forums. Go ahead, Mr. Hingle. 

Mr. HINGLE. More broadly is collaborational outreach. I think 

that is the biggest challenge that we see right now. We heard a lot 

earlier today about needing collaboration, collaboration, collaboration. Well, I have two full-time staff who are out there knocking on 

doors every day, trying to find new companies to take on the programs. SBA does the same, my dear friends, doing the same, trying 

to make more companies aware of programs that are out there. 

And we are all out there doing this. We are all out growing, but 

we are in the same boat. And I think that the training is one of 

the many components that we can offer these companies. Some are 

very senior and seasoned exporters already simply need our assistance by the way of export promotion or finance. 

So I would say that is the biggest challenge we face right now. 

I would like to see more collaboration on the outreach efforts, 

among all the different agencies we talked to today. 

Chair LANDRIEU. Okay. Let me ask this. Ms. Castro, you mentioned the travel is very, very important. You discussed how the 

U.S. Commerce Export Assistance Center was helpful in bringing 

businesses or individuals overseas. The annual budget for this program has gone down over the years. What would you say to members of Congress—and you sort of said this, but I am going to give 

you an opportunity again—what would you say to the members of 

Congress that want to either eliminate or reduce this program, and 

how important is it, do you think, for small businesses to be able 

to meet face to face to begin to develop relationships that might result in business trade and export? 

Ms. CASTRO. I think that it should continue this program, because not only that—there is a recession in this country. I, on the 

other hand, have no problem. I mean, my business is overseas. If 

what happened is overseas—of course, I work with the Caribbean 

a lot and Central America. When the U.S. has going down, like 

right now, the equipment, the metal, okay, so what these companies do overseas is they start to see the opportunity to buy—— 

Chair LANDRIEU. To buy it at a lower price. 

Ms. CASTRO. So that is when my—— 

Chair LANDRIEU. Your business increases. 

Ms. CASTRO. It increases. Everybody says to me, do you have it? 

I have the money—because a lot of them, the problem is that 

they—the Ex–Im Bank, it is good, but at the same time, the paperwork is so tedious. My people, I have full time, and they take so 

long. So the only one that I have finally made a deal was for $1,100 

84 

and we got it quick. But there are a lot of people right now interested in the—and come back to, I want to promote over there. But 

yes, the business overseas, there is a demand. 

Chair LANDRIEU. Well, let me tell you, one of the things that I 

want to do is do an informal roundtable with the Ex–Im leadership. 

I mean, Fred was here, but we need to do—and he is still here? 

Fred? Good, you are listening to this. I would like to do an informal 

roundtable with some of these business owners so that they can 

really talk specifically with the Administrator about how to reduce 

this paperwork associated. Of course, you know, we have an obligation to the taxpayer to verify and we have to be careful when we 

are lending taxpayer guarantee because taxpayers like to be repaid 

in full with interest, if appropriate. But given that, I think there 

are some excellent examples that you shared with your own company and we are proud to see companies like this growing. 

Let me see if we have a question for the entire panel. The SBA’s 

core programs include both lending and counseling, and we are 

considering giving the SBA a more robust role in export promotion. 

Now, the Department of Commerce primarily has the leadership. 

We have talked a lot about coordination. But would any of you 

want to make any suggestions in terms of the SBA network, how 

maybe it could better serve this export opportunity for small businesses? Mr. Schreiber. 

Mr. SCHREIBER. I would rather not comment on it, because I am 

not in the bureaucracy. What I would say because I am outside the 

bureaucracy, and the members of the World Trade Center are, I 

don’t really care who does the work as long as they do it well. And 

that is not only coordination, it is hiring good people. In life, I 

mean, the greatest game plan in the world might not be successful 

because you don’t have a terribly capable person doing it. 

So I guess we sort of look to you, the oversight in Congress and 

the leaders who spoke here today of those agencies to work out the 

details and deliver a product that is understandable and usable 

and logical. But we don’t really get into the TPCC or whatever. 

Most of us have no idea what they mean, what they talk about, but 

we know that it is important. But we are down at the working 

level, I am afraid, and just want to see the results. 

Chair LANDRIEU. Very good point. 

Ms. Simek. 

Ms. SIMEK. I know that the SBDCs have annual meetings where 

they are trained. Rather than trying to train them in exporting, because as you say, it is very difficult, and truthfully, when we exported, we went to the freight forwarders. We found somebody else. 

But what I would suggest is that they get an overview of what it 

is that the other exporting agencies do so they become very familiar, and then you have resources. Rather than them trying to counsel a small business that manufacturers food products, get them in 

contact with the FAS program, the SUSTAs. 

And so that is what I would strongly suggest, is that there is better coordination, better information, better training than just the 

SBDC center, than trying to put an export consultant in each one 

of their offices. I don’t see how they could afford it, because you are 

going to end up with—the quality is going to be different, and so 

depending on where you live, on each State, you are going to get 

85 

better or worse. So I think we already have a very good network, 

and truthfully, the DECs are great resources. Let us see how we 

can use them. Let us see if we can’t get all these organizations actually honestly working together for the betterment of the companies and for the nation. 

Chair LANDRIEU. Thank you so much. 

Our time for adjournment is near. I want to just say a few closing comments. One, I hope that you will all pick up the Guide to 

Louisiana Small Business. Our office is proud to have produced 

this. We will be producing it in Spanish, based on a comment from 

the Hispanic Chamber this morning. But it is our attempt to at 

least put all of the Federally supported and some State-supported 

entities that deal with small business on one—in one document 

with websites attached, and we are going to do our best from our 

committee to really have the Federal Government coordinate, not 

only better to itself with quality programming and aggressive outreach, but coordinating with the State level and local level and 

nonprofits to really create a country of entrepreneurs and a country 

of entrepreneurs capable of export. 

And where we believe—I believe, I should speak for myself—I believe that the road out of this recovery is going to be led by small 

business and they are going to have to find opportunities, whether 

in the 50 States, the economy of the 50 States, but also try to find 

opportunities in the world economy. And there is no reason that 

the government can’t do a better job, with new technologies and 

emerging technologies, exciting opportunities. The world is truly 

becoming smaller and I just think that they need a little more 

focus and work. 

That is what our committee is charged, and one of my visions. 

I share that with my Ranking Member, Olympia Snowe. I want to 

recognize that her senior counsel is here, Mr. Wally Hsueh. Would 

you stand, Wally? Wally is in the back, and we appreciate the Republican Staff Director being present. We work in a very bipartisan 

fashion on this committee. 

I want to thank my State staff and Don Cravins, my Staff Director. He and his staff have organized two very productive days in 

the city, in the region today. We had a reception last night. We had 

standing room only. This morning, hundreds of small business owners showed up at the University of New Orleans for a general small 

business outreach conference. Then we did a tour of Lakeview, of 

the Lower Ninth Ward, of the Upper Ninth Ward, visited with 

business owners on the ground, conducted this hearing, and we are 

ready to stop working for a few minutes. 

Go ahead, Mr. Schreiber. 

Mr. SCHREIBER. Senator, can I make one important point, and 

you are very aware of this point. We want to thank you, Senator, 

for your leadership last year with the entire Louisiana delegation 

on an important matter related to CAFTA, the Dominican Republican CAFTA Free Trade Agreement. We hope you will follow up— 

I don’t know if he is here—with Ambassador Kirk, because you 

crafted, you and the delegation, a joint letter that went to President Bush requesting that the administration consider New Orleans as a site for meetings and negotiations under the CAFTA 

agreement. 

86 

There isn’t a Secretariat of CAFTA, and so the thought here was, 

and by you, to, well, let us make New Orleans the de facto Secretariat by holding these negotiation meetings and other events that 

they hold, instead of always meeting in Washington or in the respective countries, get out of Washington, and not only would New 

Orleans be the perfect location for reasons we all know, but it has 

been demonstrated. Last year, in fact, the day you wrote that letter 

that you and the delegation did to President Bush, he was here 

with the President of Mexico and the Prime Minister of Canada at 

the Summit of the Americas. And previously in the negotiations— 

this was seven or eight years ago—New Orleans was one of the cities selected for negotiations under CAFTA. 

So what a perfect location and helping in the recovery process 

and combining it with tourism, economic development, and business. And let us face it. We know that the Latin Americans, the 

Central Americans, will love New Orleans and would jump to come 

here. So we request your further leadership with Ambassador Kirk 

and the administration following up on this. 

Chair LANDRIEU. Thank you. Excellent suggestion. 

Is there any further business? If there is no further business, 

meeting adjourned. 

[Whereupon, at 3:05 p.m., the committee was adjourned.] 

(87) 

APPENDIX MATERIAL SUBMITTED 

88 


Insert offset folio 51 here 53008.051
89 


Insert offset folio 52 here 53008.052
90 

Æ 


Insert offset folio 53 here 53008.053