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Transcript-MSN.com's Business On Main, "Voices that Matter" Interview

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Friday, September 18, 2009

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Secretary of Commerce Gary Locke
Interview, MSN.com’s Business On Main “Voices that Matter” (Susan Schreter)

Program Introduction: When President Obama announced Gary Locke as his nominee for Secretary of Commerce, he called the former Washington State governor a "tireless advocate for our economic competitiveness." With six months of service under his belt, Secretary Locke spoke to Business on Main about his goals for helping small-business owners succeed.

Business on Main: What is at the heart of your agenda as the new Secretary of Commerce?

U.S. Commerce Secretary Gary Locke: The focus of the Department of Commerce and what I want to do as secretary is really help businesses grow and expand. I want to help them sell their goods, be more competitive and, ultimately, create new jobs at good family wages.

We have a lot of incredible programs to help businesses, but not enough businesses know about them. That's our fault. So we're on a mission to help the president create more jobs by improving our services for small-business owners and entrepreneurs. We also have to make it easier for businesses to access these services and communicate what new things we are doing for small-business owners.

Business on Main: How do you as Secretary of Commerce monitor the financial health of the small-business community?

Secretary Locke: The Department of Commerce operates very much like a holding company, with several different agencies that operate under our umbrella, including the International Trade Administration; U.S. Patent and Trademark Offices; the Census Bureau; the Bureau of Industry and Security; Economics and Statistics Administration; Minority Business Development Agency and more. So we are an agency with a lot of knowledge and economic statistics on hand. Using these information resources, we can tailor programs to help entrepreneurs and small businesses grow. For example, we have the Manufacturing Extension Partnership program, which provides consulting services to businesses on how they can be more productive and efficient.

Business on Main: How can the Department of Commerce help small-business owners sell their goods overseas?

Secretary Locke: The majority of U.S. exporters are small- and medium-sized businesses. But what is interesting is most of these businesses just sell their products to one country. We have a lot of resources to help companies sell their products abroad. Business owners should check out www.export.gov, which provides information on all the federal government's export assistance programs. One program that is a jewel, but, quite frankly, we don't publicize enough, is the International Trade Commission's U.S. Commercial Service.Commercial Service officers will actually conduct due diligence on behalf of small businesses and will help line up interviews with potential customers. I've had so many small-business owners come up to me and say that they would not be in business today if it were not for the contacts developed by our Commercial Service offices.

Business on Main: We're talking in mid-September, and there's much discussion in the nation about the president's recent speech on health care. What should small-business owners understand about President Obama's health care plan?

Secretary Locke: The president's health care plan is critical to the survival and competitiveness of small businesses. Right now, small businesses pay as much as 18 percent to 20 percent more in premiums than large companies pay. During the last 10 years, health care costs for employers have doubled, but businesses are not seeing revenue or profit growth in excess of 10 percent a year.

As a result, a lot of small businesses are cutting back or dropping coverage altogether. And those companies that do provide health care coverage for their employees find that they operate at a competitive disadvantage to companies that do not.

Under the president's plan, 95 percent of businesses would be exempt from any mandate to provide coverage, but if they do [provide coverage] they are eligible for a 50 percent tax credit. Sole proprietors will have access to high-quality, affordable coverage by participating in an exchange where they can easily shop for insurance and compare prices, benefits and quality. The president is committed to making sure that health insurance is affordable for people who cannot afford any insurance now and has made it clear that there must be a hardship waiver for those who still can't afford it.

Business on Main: The Department of Commerce recently announced an innovative pilot program in Detroit that offers one-stop service assistance for business owners. What are your expectations for this program?

Secretary Locke: The basic premise of our test program in Detroit—which we intend to take nationwide—is to operate one-stop service resource centers where business owners can learn about all the programs offered by the Department of Commerce and other government agencies. Business owners and entrepreneurs can meet and interact with one highly knowledgeable person who is cross-trained on all government programs. This person will be an important advocate and skilled counselor to the business owner. Eventually, we want to get more services online to help make it easier for business owners to get the information they need.

Business on Main: The small-business community generates 13 times the number of patents per employee as large corporations. The U.S. Patent and Trademark Office is under your leadership. What is at the top of your agenda for the USPTO?

Secretary Locke: Quite frankly, the Patent and Trademark Office needs to be overhauled. I find it absolutely outrageous and unacceptable for the time it takes before we can even get a look at a patent application. We call it a "first action" and it can take more than two years. And then it may take another year for patent approval or rejection. This stifles innovation and creates too much uncertainty in the marketplace. It is my goal to dramatically revamp and streamline patent processing times.

Business on Main: Technology-oriented small businesses rarely have the extra resources to police and protect their intellectual property in foreign markets, especially in Asia. How can the Department of Commerce help?

Secretary Locke: The Department of Commerce views intellectual property protection as one of our primary functions, especially with respect to international relations. In all of my travels, we stress the need for countries to vigorously enforce intellectual property rights. At the end of October, I will be leading a U.S. delegation on trade and commerce to China covering a whole host of trade issues. In addition to intellectual property protection, we will be addressing protectionist policies that the Chinese government has imposed which create an unlevel playing field. Our goal is to break down these barriers and improve the ability for U.S. companies to sell goods and services into China.

Business on Main: One of our Business on Main community members wrote in asking if you have any insights on the future of the "cash for clunkers" program and other new initiatives like it.

Secretary Locke: The Department of Energy has a new rebate program for the purchase of appliances certified as energy-efficient by the EPA's Energy Star program. We're hoping that people replace old refrigerators and other appliances that contribute to greenhouse gasses, plus give business retailers a boost.

Business on Main: Recently you appeared with Karen Mills, the new administrator of the Small Business Administration, to announce a government-wide initiative to increase small-business participation in government contracting. What are the components of this initiative?

Secretary Locke: The vice president [Joe Biden] tasked Karen Mills and me to lead the effort to ensure that small businesses, including minority businesses, were getting their fair share of the Recovery Act dollars. We are redeploying some Department of Commerce assets to develop new tracking and reporting mechanisms for the federal, state and local level. By requiring these agencies to report back contracting activity, we believe it creates a mindset of the importance of including small businesses in contracting opportunities.

Business on Main: What can be done to encourage more major corporations to share the wealth by subcontracting federal contract work to small businesses?

Secretary Locke: Our new reporting requirements will monitor how much of the Recovery Act stimulus dollars are going to small businesses and veteran-, women- or minority-owned businesses as subcontractors. When you measure it, people pay attention. Plus, they know that the Obama administration is paying attention.

Business on Main: The government just released a report on small-business contracting. The Department of Commerce did not meet its overall small-business contracting goals in three areas: overall small business, contracts to service disabled veterans, and HUBZone contracting goals. Commerce did meet its goals for women-owned and small, disadvantaged businesses. What will you do to ensure that your administration meets all small-business contracting goals?

Secretary Locke: There are specific small-business contracting goals for each of the federal agencies. I'm pleased to say that 43 percent of the Department of Commerce's contracts went out to small businesses. Our goal was 46 percent, but it's almost twice as much as the federal government-wide goal for small-business contracting, which is 23 percent. I count this as a win.