Why It Matters

The Senate Committee on Small Business and Entrepreneurship convened on June 17 to examine small business entrepreneurship across four states, but the hearing became a flashpoint for Democratic criticism of the Trump administration's proposed cuts to Small Business Administration programs. Senator Edward J. Markey (D-MA) used the forum to challenge what he characterized as devastating budget reductions, while Senator Joni Ernst (R-IA) celebrated American entrepreneurship and the administration's commitment to small business growth.

The hearing titled "Hearings To Examine 250 Years Of Main Street, Focusing On Retail To Research" was part of an America 250 series focused on small businesses as the cornerstone of American commerce. The hearing examined small businesses in four states: Iowa, Idaho, Delaware, and Nevada, drawing testimony from entrepreneurs and local leaders representing different sectors of the economy.

The Big Picture

The Senate Small Business hearing was the third installment in an active series under Chair Ernst and Ranking Member Markey examining American entrepreneurship and small business innovation. The 119th Congress has made small business policy a recurring focus, with prior hearings in 2025 addressing American entrepreneurship more broadly and the small business pet economy.

The timing of this congressional hearing on small business entrepreneurship comes amid significant policy disputes. The Trump administration, which took office on January 20, 2025, has proposed substantial changes to SBA programs. The administration's proposed FY2027 budget adds to a 32 percent decline in SBA lending through the 7(a) Loan Program due to Trump's lending restrictions. Additionally, the budget proposed eliminating funding for the Minority Business Development Agency (MBDA) and eliminating 15 of the 16 entrepreneurial development programs.

The hearing also coincided with the launch of the administration's Freedom 250 Small Business Pledge on June 16, which offers small businesses official certificates, recognition as part of the 250th anniversary celebration, and membership in a national network of entrepreneurs. SBA Administrator Kelly Loeffler stated that under President Trump's leadership, small businesses are leading a golden era of growth and strength.

However, this optimistic framing masks underlying tensions about the direction of small business policy. The data presented at the hearing painted a more complicated picture. A Main Street Alliance survey of approximately 3,000 small business members found that 81.5 percent said they may raise prices to offset tariff costs, while 41.7 percent reported they would delay business investments due to tariff costs. A Federal Reserve survey published in March 2026 found that 42 percent of U.S. small businesses have experienced rising costs due to tariffs over the past year.

Small businesses paid an average of $42,600 in tariff costs in September alone, putting them on track to face more than $500,000 in tariff costs in 2026 if September levels persist. A Small Business Majority poll found that of those impacted directly by tariffs, more than half (53 percent) are facing increased costs from their suppliers, with 47 percent having increased the price of certain materials or products.

What They're Saying

The Senate Committee on Small Business Entrepreneurship hearing featured four witnesses bringing diverse perspectives on entrepreneurship and small business challenges.

Don DeWaard, Mayor of Pella, Iowa, testified about his community's manufacturing heritage and entrepreneurial ecosystem. DeWaard has served as mayor of Pella since 2020 and previously spent 13 years in public accounting, nine years in the tire business, and 15 years in real estate development. He holds a bachelor's degree in accounting from Central College and earned his CPA certificate. Pella itself was founded in 1847 by Dutch immigrants and has a population of approximately 10,600 residents. The city is home to Pella Corporation, founded in 1925 by Pete Kuyper, which today employs more than 10,000 people and is recognized as one of the leading window and door manufacturers in North America. Vermeer Corporation, founded in 1948 by Gary Vermeer as a small machine shop in Pella, generates more than one billion dollars in annual revenue and employs over 4,000 people worldwide.

Cameron C. H. Miller, President and CEO of Urban Chamber of Commerce, brought the perspective of Black business ownership in Las Vegas. The Urban Chamber of Commerce marks 46 years as one of Nevada's oldest organizations dedicated to the success of black-owned businesses. Miller brings nearly two decades of experience building businesses in beauty, real estate, and film production, and grew up in a family of casino workers and small business owners in Las Vegas.

John 'Jack' Hruby, Vice President of Strategy & Outreach at PerceptView, represented the defense and technology sector. Hruby served in the U.S. Air Force for over 20 years as an officer, fighter pilot, and commander of the Fourth Operations Group, accumulating over 3,000 flying hours and completing 117 combat missions. After his Air Force service, he founded two companies and served as president of Black Sage, an innovator in the counter-UAS space. Hruby holds a bachelor's degree in international affairs from the U.S. Air Force Academy and three separate master's degrees, including an MBA.

Dr. Kris Vaddi, Chief Executive Officer of Prelude Therapeutics, testified about Delaware's innovation ecosystem. Vaddi has been part of the ecosystem for 27 years and involved in the launch and leadership of three different companies dedicated to discovering treatments and cures for diseases. Vaddi has led Prelude Therapeutics for the past decade, inventing precision cancer medicines to treat underserved patients.

The Hearing

The central tension at the hearing emerged in Ranking Member Markey's opening statement and subsequent remarks. Markey slammed the Trump administration's proposed budget cuts to critical SBA programs, characterizing them as undermining small business support. Markey and all Senate Small Business Democrats had written to SBA Administrator Kelly Loeffler in May 2025, demanding the immediate release of entrepreneurial development program funding. At the June hearing, Markey emphasized that the proposed cuts affect nearly 1 million small businesses and used the phrase "Turn Main Street into Pain Street" to describe the impact of the Trump administration's SBA policies.

Chair Ernst, by contrast, highlighted the administration's accomplishments. Ernst has been particularly active in promoting small business issues, making 19 matching statements about small business topics in the past month, more than any other committee member. On June 17, Ernst posted a tweet welcoming Mayor Don DeWaard to the Small Business Committee hearing with a sentiment score of +0.90, indicating highly positive sentiment. Ernst also posted a celebratory tweet about small businesses and entrepreneurs fulfilling America's founders' promise, with a sentiment score of +0.67.

Ernst pointed to positive metrics from the SBA's operations. In FY25, the Small Business Administration delivered record capital to small businesses, guaranteeing $45 billion in 7(a) and 504 loans to more than 85,000 small businesses, the highest volume in the agency's history. The SBA guarantees 1,600 small business loans per week worth over $860 million, or 320 loans per workday for $170 million. The SBA delivered more than $100 billion in capital access across its lending, disaster, and investment programs in 2025.

Ernst also highlighted legislative achievements. The Senate unanimously passed Chair Ernst's updates to put small businesses first in America's Innovation Program, with SBIR-STTR programs now prioritizing truly small businesses over mills and deterring foreign influence. An Ernst-led bill to extend the statute of limitations for COVID fraud passed the Senate. Ernst introduced the COST Act (S.4130, 119th Congress) on March 18, 2026, which was referred to the Small Business and Entrepreneurship Committee.

Political Stakes

The hearing exposed significant political vulnerabilities for the Trump administration on small business policy. While the administration touts record lending volumes and the Freedom 250 initiative, the proposed budget cuts represent a dramatic shift in SBA priorities. The decline in 7(a) lending and the proposed elimination of MBDA funding directly contradict the administration's rhetoric about supporting small businesses.

The tariff data presented at the hearing poses particular political challenges. With small businesses facing potentially $500,000 in annual tariff costs and the vast majority reporting they will raise prices or delay investments, the administration faces pressure to address these concerns. The data showing that only 65 new 8(a) firms have been approved by the SBA since Trump returned to office in January 2025, compared to more than 2,000 under the Biden administration, further complicates the administration's narrative about supporting minority-owned businesses.

For Markey and Senate Democrats, the hearing provided a platform to challenge what they view as anti-small business policies. The Democratic focus on budget cuts and tariff impacts reflects broader concerns about the administration's economic direction. However, Democrats face the challenge of articulating an alternative vision when Republicans control both chambers of Congress and the presidency.

For the witnesses, particularly Miller and Vaddi, the hearing offered visibility for their respective communities: Black business owners in Nevada and the biotech innovation ecosystem in Delaware. DeWaard's testimony highlighted Iowa's manufacturing heritage and the role of local leadership in supporting entrepreneurship.

The Other Side

The Trump administration and Republican committee members argue that their policies support small business growth through different mechanisms than traditional SBA lending. The Working Families Tax Cuts Act, signed into law by President Donald J. Trump on July 4, 2025, includes historic tax cuts for small businesses in 2026. The administration contends that lower taxes and reduced regulatory burdens create better conditions for entrepreneurship than government lending programs.

The Freedom 250 initiative represents the administration's alternative approach to celebrating and supporting small businesses. By recognizing entrepreneurs as part of America's 250th anniversary celebration, the administration frames small business support as a cultural and patriotic endeavor rather than purely a government funding question.

Republicans also note that SBA lending volumes remain historically high despite proposed budget reductions. The administration's focus on preventing fraud, highlighted by Ernst's work on extending the statute of limitations for COVID fraud, reflects a different priority—ensuring that SBA resources reach legitimate small businesses rather than fraudsters.

What's Next

The June 17 hearing is unlikely to be the final word on small business policy in the 119th Congress. Senate Democrats will likely continue to pressure the administration on SBA funding levels, and the proposed budget cuts may face resistance in appropriations negotiations. The tariff impacts on small businesses will remain a focus of Democratic criticism.

Chair Ernst's continued activity on small business issues suggests additional hearings and legislative initiatives are forthcoming. The COST Act and other Ernst-led measures may advance through the committee, potentially creating additional opportunities for debate over the administration's priorities.

The America 250 series will likely continue, providing regular forums for examining small business entrepreneurship across different sectors and regions. Future hearings may generate additional data on how tariffs, tax changes, and regulatory reforms affect small business performance.

The Bottom Line

The June 17 Senate Small Business hearing exposed fundamental disagreements about how to support small business entrepreneurship, with Democrats emphasizing the importance of SBA lending and development programs while Republicans touted tax cuts and the Freedom 250 initiative. The data presented on tariff impacts suggests that, regardless of the administration's policy framework, small businesses face significant economic headwinds in 2026.

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